Click here to Get Complete Solved Assignments
List of Fresher Jobs, Walk in Interview
Right place for Job Seeker. Fresher Job, Walkin Interview, Exam results.
Visit www.walkinjobstoday.com

Spring 2014 MBA solved assignments of MB0038 Q1. Define the terms ‘strategy’. Explain the following: a) Corporate strategy b) Business strategy c) Functional strategy

AnswerStrategy:Once you have your vision, you have to see how that vision can be executed. Here is where strategy comes in. Strategy means the grand plan and the term is borrowed from the military which distinguished between the grand plan and actual action by calling the former strategy and the latter tactics.

Strategy in organisations can be divided into three:

  • Corporate strategy
  • Business strategy
  • Functional strategy
Corporate strategy
If you are a company like TATA or BIRLA, you will have several businesses under you and a corporate headquarters which controls these. Each of these businesses may be run by an independent company much like Tata Motors runs the vehicle business and Tata Consultancy Service runs the IT business (they both are different companies). The corporate headquarters will have grand plans on how each business should operate. For example, it might say that that Tata Motors should design, develop, and manufacture an indigenous small car Nano or that TCS should expand business to China. This grand plan created by the corporate headquarters is called ‘Corporate Strategy’. It lays down the grand plan to be followed by each business under a corporate headquarters. If you are small like Raju, you will not have a corporate strategy; however, will still have a strategy for your business. Though you can call it the corporate strategy of Raju on the argument that Raju is a corporate, it is perhaps inappropriate. Since Raju is not very big, usually we prefer to call his strategy as business strategy.

Business strategy
Every business, small or big, will have a business strategy. This is the grand plan for doing business. For example, Raju can make a grand plan of expanding his business to another district or having branches. He can take a decision to be the provider of low cost furniture or highly differentiated furniture, household furniture only, modular furniture only, a supplier of all furniture needs, etc. This is what business strategy is. If you were a TATA company, each business of TATA (say Tata Motors, Tata Iron and Steel Company, Tata Hotels, etc) would have their own business strategy in consonance with the corporate strategy.

Functional strategy
Once you have a business strategy, each independent department will need its own strategy. For example, the HR of Tata Motors will need a strategy quite different from the HR of Tata Consultancy Service (TCS). So, the operations, marketing, finance, HR, etc of each business will make their own grand plan or strategy and this is called functional strategy. In the case of Raju, he might plan to hire more carpenters and pay daily wages or wages per piece. This is the HR strategy (of course it is only one element of HR strategy but illustrates what functional strategy means). In other words, the grand plan made by each functional area is called functional strategy. Usually organisations have operations strategy, finance strategy, marketing strategy, and HR strategy. If you are large and well diversified, you may have an information strategy, supply chain strategy, etc. also and this depends to some extend on the nature of your business. For example, if you are in retail chain business like Big Bazaar, you may have a merchandise strategy (what products to sell) and supply chain strategy (how to procure the products at the lowest cost and move them nationally) as these are very important to business success. Similarly, Raju too can have a strategy to purchase wood in bulk from Malaysia and ship it and call it his procurement strategy. 

0 comments:

Post a Comment

Related Posts Plugin for WordPress, Blogger...
 
x

Get Our Latest Posts Via Email - It's Free

Enter your email address:

Delivered by FeedBurner