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*3.1.2 Theories of Corporate Strategy - Coggle Diagram
*3.1.2 Theories of Corporate Strategy
Development of Corporate Strategy
Businesses develop corporate strategy by utilising frameworks like Ansoff's Matrix and Porter's Strategic Matrix to identify and evaluate strategic options.
Porter’s Strategic Matrix
•Cost Leadership
Cost leadership aims to become the lowest-cost producer in the industry, enabling businesses to offer lower prices than competitors or achieve higher margins at the same price level.
•Differentiation
Differentiation involves offering unique products or services that are valued by customers, allowing businesses to charge premium prices.
•Focus
Focus concentrates on serving a specific market niche, either through cost focus (being the lowest-cost producer in that segment) or differentiation focus (offering unique products tailored to the niche’s needs).
Aim of Portfolio Analysis
Portfolio analysis is a strategic management tool used to evaluate and manage a company's collection of products, services, or business units.
Achieving Competitive Advantage through Distinctive Capabilities
strategic parterships
innovation
customer service
operational efficiency
brand reputation
Effect of Strategic Decisions on Human, Physical, and Financial resources
Tactical decisions are short-term, specific actions that support the execution of strategic decisions.
Strategic decisions are long-term, high-level decisions that define the overall direction and goals of a business
Ansoff’s Matrix
Market Penetration focuses on increasing sales of existing products in existing markets.
Market Development involves selling existing products in new markets.
Product Development focuses on introducing new products to existing markets.
Diversification involves introducing new products into new markets