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Functional Strategy and Strategic Choice, Chapter 8 - Coggle Diagram
Functional Strategy and Strategic Choice
Functional Strategy
Operation Strategy
Determines how and where a product or service is to be manufactured, the level of vertical intergration in the production process, the deployment of physical resources, and relationships with suppliers
Purchasing Strategy
Multiple sourcing
Sole sourcing
Deals with obtaining raw materials, part, supplies needed to perform the operation function
Parallel sourcing
R&D Strategy
Delas with product and process innovation & improvements and also deals with the appropriate mix of different types of R&D and question of how new tech should be accessed
Technological leader
Open innovation
Technological follower
Logistic Strategy
Deals with the flow of products into and out of the manufacturing process
Trends include:
-Centralization
-Outsourcing
-Internet
Financial Strategy
Leveraged buyout
Reverse Stock split
Examines the financial implications of corporate and business-level strategic options and identifies the best financial course of action
HRM Strategy
Addresses the issue of whether a company or business unit should hire a large number of low-skilled employees who receive low pay, perform repetitive jobs, and will most likely quit after a short time (the fast-food restaurant strategy) or hire skilled employees who receive relatively high pay and are cross-trained to participate in self-managing work teams
Marketing Strategy
Market development strategy
Deals with pricing, selling, distributing a product
Product development strategy
Brand extension, Push Strategy,
Pull Strategy, Skim pricing, Penetration pricing
Information Technology Strategy
Follow-the-sun management
Strategic to Avoid
Follow the leader
Hit another home run
Arms race
Do everything
Losing hand
Strategic Choice : Constructing Scenarios
Corporate Scenarios
Pro forma (estimated future) Balance sheets and income statements that forecast the effect each alternative strategy and its various program will likely have on division and corporate return on investment
Steps:
Use industry scenarios to develop assumptions about the task environment
Develop common size financial statements for prior years
Construct detailed pro forma financial statements for each strategic alternative
The Sourcing Decision : Location of Functions
Outsourcing
Offshoring
Chapter 8
Strategy Formulation : Functional Strategy and Strategic Choice
Rensy Kartika - 120310170009