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Strategic Management chap 6

strategy formulation: corporate strategy

Terms

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What is retrenchment?
Turnaround strategies for when times are tough.
Name three stability strategies
Pause (timeout), No Change, profit (definding profits by cutting short term expenditures)
Vertical Growth
A concentration strategy in which one takes over functions in the value chain previously done by someone else.
Directional strategy consists of three main parts. Name 'em.
Growth strategies, stability strategies, retrenchment strategies.
Name several horizontal growth strategies
exporting, licencing, franchising, joint ventures, acquisitions, green field development, BOT projects.
There are three types of retrenchment strategies. Name 'em.
Turnaround (contraction/consolidation), Captive Company (become a supplier to a single customer) and DIvestment (sell out)
Why use the GE screen
It is more subtle, and contains a ton more information. On the downside, it can get cumbersome.
Why use the BCG screen?
simple
Concentration strategies are for what?
to achieve growth in sales, assets, or profits.
Corporate strategy has three elements. Name 'em.
Directional strategy, portfolio strategy, parenting strategy
Diversification can take two paths. Name 'em
Concentric (similar product) or Conglomerate.
What is a stability strategy?
Continuing current activity patterns.
Name two forms of Portfolio Analysis
BCG and GE.
Horizontal growth:
A concentration strategy in which one expands into other geographic locations.
why use concentric over conglomerate growth strategy
If one is good at something, but the industry is dogging.

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