The document discusses various corporate strategies including the 4 E's (extend, expand, exit, enhance). It defines key strategic concepts like vertical integration, horizontal integration, diversification, growth strategies, stability strategies, and retrenchment strategies. Some specific strategic options covered are mergers, acquisitions, strategic alliances, turnarounds, contractions, and divestments. The document also discusses factors like strategic fit, directional strategy, and the hierarchy of strategy from functional to corporate levels.

1. 4 E’s to Addressing Corporate
Strategy
Extend
Expand
Exit
Enhance

2. The 4 E’s to Addressing Corporate Strategy
 Extend. It means extending the business by going
beyond its current business model by adopting a
new business model or entering into new business.
 Expand. This option takes the form of adding
products and/or services within the context of the
company’s existing business concern or present
area of operation.

3. Exit. This option takes the form of making some
sacrifice by dropping some product lines and services
or business units deemed uncompetitive or
unprofitable or less profitable to operate.
Enhance. This option takes the form of adding
functionally or improving a product or service that is
currently being offered.

5. Key Issues is Corporate Level Strategy
Directional Strategy: The firm’s overall orientation
towards growth, stability or retrenchment
Portfolio Strategy: The industries or markets in which
the firm competes through its products and business
units.
Parenting Strategy: The manner in which management
coordinates activities, the transfers resources, and
cultivates capabilities among product lines and business
units

6. Strategic Choices at Corporate Level
Business Closure: This is an undesired act of folding up
or shutting down non profitable business units to control
or avoid further losses.
Business Disposal: This calls for disposing or unloading
some of the members, subsidiaries, affiliates or
investments in other business concerns deemed
unprofitable or less profitable and/or deemed a burden to
the mother organization.
Business Acquisition: This is an option of business
establishments meant to expand their size and make their
presence felt in whatever area they want to do business.

7. Strategic Choices at Corporate Level
Business Reorganization: This option may or may not
lead to ownership changes among members of the
organization or the conglomerate nor it may result to
business acquisition or disposal option.
Business Start up: This option means purposely
organizing another business concern instead of simply
acquiring an existing business organization or investing in
it.
The impact of doing nothing different: Sounding weird
and uncalled for, status quo can be an option if after a
thorough study and analysis such situation is deemed
appropriate.

8. Basic Model for Integration and Diversification Options
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Horizontal
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Forward
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Backward
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Horizontal
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Horizontal integration/diversification
Customers/End
Users
Suppliers

9. Vertical integrationVertical integration
It iIt is the degree to which a firm owns its upstream
suppliers and its downstream buyers.
The term VI describes a style of management control.
Involves engaging in business activities to the level of
sources of supply or forward in the direction of final
consumers.

10. Vertical integrationVertical integration
Three (3) varieties:
Backward (upstream) vertical integration: the firm
engages in business activities in the area of distribution
and retailing of the product or services directly to the
customer
Forward (downstream) vertical integration: the
business concentrating the efforts at the stage of raw
materials production or close the source of raw
materials.
Balanced (both upstream and downstream) vertical
integration: the firm engages in adding new product or
services.

11. Full Integration: The firm internally makes 100 percent
of its key supplies and completely controls its distributors.
Taper Integration: A firm internally produces less than a
half of its own requirements and buys the rest from
outside suppliers.
Quasi- Integration: The company does make any of its
key suppliers but purchases most of its requirements from
outside suppliers that are under its partial ownership or
control.
Long-term Contracts: The company signs an agreement
or contact with another firm providing agreed upon goods
and services for a specified period of time.

12. Horizontal integrationHorizontal integration
It is a strategy where a company acquires, mergers or
takes over another company in the same industry
value chain.
Merger is the joining of two similar sizes,
independent companies to make one joint entity.
Acquisition is the purchase of another company.
Hostile takeover is the acquisition of the company,
which does not want to be acquired.

13. Horizontal Diversification
Generally perceived as a strategy that
evolves
around the idea of seeking ownership or
increased control over the direct and indirect
competitors of the business.

14. Direct and Indirect competitors
Direct competitors can be classified as:
Offering the same products and/or services as you are
offering to your clients and/or customers.
Having the same targeted field of clients, customers
and/or demographics.
Using the same tactics in advertising or bringing
news/informations of products/services to your targeted
demographics.
Indirect competitors can be classified as “wanting to
have a share of the pie”

15. Hierarchy of Strategy
Functional Strategy
Corporate Strategy
Business
(Division level strategy)

16. Corporate strategy —this strategy seeks to determine
what businesses a company should be in or wants to be in.
Corporate strategy determines the direction that the
organization is going and the roles that each business unit
in the organization will plan in pursuing that direction.
Business strategy —this strategy seeks to determine how
an organization should compete in each of its businesses.
Functional strategy —this strategy seeks to determine
how to support the business strategy.

17. • Conglomerate Diversification: Involves in dealing
with product s or services that have nothing to do or
not related to the kind of product or services it is
presently dealing with.
• Concentric Diversification: involves in dealing with
the product or services that are somehow related with
what the firm is presently handling

18. Situations favouring conglomerate
diversification
In an effort to extend growth beyond its turf, large
companies dream of expanding their image beyond profit
objectives .
Fame and corporate image beyond the boundaries of the
industry or sector they are known for are among the
motivations that drive corporate giants to go into
conglomerate diversification.

19. Concentric Diversification
It is a corporate diversification option that involves
engaging or dealing with products or services that are
somehow related to or associated with what the firm
is presently handling.

20. Situations favouring concentric
diversification
When an organization competes in a no-growth or a
slow-growth industry;
When adding new, but related products significantly
would enhance the sales of current products;
When new, but related, products could be offered at
highly competitive prices;
 When new, but related, products have seasonal sales
levels that counterbalance an organization’s existing
peaks and valley;
When an organization’s products are currently in the
decline stage of the product life cycle; and
When an organization has a strong management team.

21. The Need for Strategic Fit
Product Fit: Is achieved when distribution channels, sales
forces, promotion techniques, or customers can be handled
at the same time for more than one product or service.
Operating Fit: Involves economies being realized in certain
areas like purchasing, warehousing, production and
operations, research and development, or personnel from
more than one product or services.
Management Fit: Occurs when managers are given
responsibility over areas of accumulated exposure from one
line of business to another.

22. Directions of Corporate Level Strategies
Growth Strategy expands the company’s
activities
Stability Strategies make no chance to the
company’s current activities
Retrenchment Strategies reduce the company’s
level of activities

23. Growth Strategy Options
Merger- Involves a transaction involving two or more
corporations in which a stock is exchanged or swapped
among independent business organizations from which
only one company services
Acquisition- Is an option that involves the purchase of a
company then completely absorbed as in operating
subsidiary or division of the acquiring corporation.
Strategic alliance- is another option involving a
partnership among two or more corporations or business
units to achieved strategically significant objectives that
are mutually beneficial.

24. Stability Strategies
Pause/proceed with caution: This is in effect, a sort
of time out. It is an opportunity to rest before
continuing a growth or retrenchment strategy.
No change strategy: It involves a decision to do
nothing new.
Profit strategy: It involves a decision to do nothing
new in a worsening situation and instead, to act as
though the company’s problems are only temporary.

25. Retrenchment strategies
Turnaround strategy: This strategy emphasizes on the
improvement of operational efficiency and is probably most
appropriate when a corporation’s problems are pervasive but
not yet critical.
Contraction
Consolidation
Sell-out/Divestment strategy: This strategy is resorted to
when a company has a weak competitive position in its
industry.
Bankruptcy strategy: Involves giving up management of
the firm to the courts in return for some settlement of the
corporation’s obligations.
Liquidation strategy: Is the termination of the firm’s
business operation.