This document discusses various corporate growth strategies. It outlines strategies for internal growth such as market penetration, market development, and product development which involve expanding a company's existing operations. It also discusses external growth strategies like mergers, acquisitions, and strategic alliances. Specific external growth strategies covered are vertical integration, horizontal integration, concentric diversification, and conglomerate diversification. The overall goal of growth strategies is to increase a company's sales, assets, and profits.
When an organization takes up an activity in such a manner that is related to the existing business definition of one or more of firms businesses, either in terms of customer groups, customer’s functions or alternative technologies, it is called concentric diversification.
When an organization adopts a strategy which requires taking of those activities which are unrelated to the existing businesses definition of one or more of its businesses either in terms of their respective customer groups, customer functions or alternative technologies, it is called conglomerate diversification.
When an organization takes up an activity in such a manner that is related to the existing business definition of one or more of firms businesses, either in terms of customer groups, customer’s functions or alternative technologies, it is called concentric diversification.
When an organization adopts a strategy which requires taking of those activities which are unrelated to the existing businesses definition of one or more of its businesses either in terms of their respective customer groups, customer functions or alternative technologies, it is called conglomerate diversification.
When pursuing a vertical integration strategy, a firm gets involved in new portions of the value chain. This approach can be very attractive when a firm’s suppliers or buyers have too much power over the firm and are becoming increasingly profitable at the firm’s expense.
The Ansoff Matrix is used by firms to generate growth strategies. Growth strategies range from market penetration, product development, market development and diversification.
The implementation of growth strategies should be done cautiously. Firms must first consolidate their current business before embarking on growth strategies.
When pursuing a vertical integration strategy, a firm gets involved in new portions of the value chain. This approach can be very attractive when a firm’s suppliers or buyers have too much power over the firm and are becoming increasingly profitable at the firm’s expense.
The Ansoff Matrix is used by firms to generate growth strategies. Growth strategies range from market penetration, product development, market development and diversification.
The implementation of growth strategies should be done cautiously. Firms must first consolidate their current business before embarking on growth strategies.
Corporate level strategies are basically about the choice of direction that a firm adopts in order to achieve its objectives.
Corporate strategy is essentially a blueprint for the growth of the firm.
The corporate strategy sets the overall direction for the organization to follow.
It also spells out the extent, pace and timing of the firm’s growth.
Diversification strategy ( megha and rakesh)Rakesh Kumar
this ppt is regarding how a company or business can use strategy of diversification its business.there are basically two types of diversification strategy which are adopt by business.
2. STRATEGY
A strategy of a corporation forms a
comprehensive master plan stating how the
corporation will achieve its mission and
objectives.
“Plan to achieve the mission and
objectives.”
Strategies answer the question HOW you
will attain objectives.
3. Different Number of Strategies
Growth Strategies: Expand the company’s
activities.
Stability Strategies: Make no change to the
company’s current activities.
Retrenchment Strategies: Reduce the
company’s level activities.
Combination of different Strategies.
4.
5. Growth/Expansion Strategies
These strategies are designed to achieve growth
in sales, assets, profits or some combination.
A corporation can grow internally by
expanding its operations both globally and
domestically, it can grow externally through
mergers, acquisitions, and strategic alliances;
i.e.
•Intersification
•Diversification
6. Intersification
A corporation can grow internally by expanding its
operations both globally and domestically through
following strategies:
•Market Penetration
•Market Development
•Product Development
7. Market Penetration: You sell more products to your same
customers.
- you lower the price, add salespersons and outlets and try to
increase use by present customers.
Market Development : You distribute goods to new customers
that haven’t traditionally been in your territory or that haven’t been
the type of customer to whom you market. Often useful when a
company has excess production capacity.
Product Development : Change or renew product that is
becoming perceptually, or technically inferior.
E.g. Old Tide is New Tide with crystals – In some cases products
are is just perceived as inferior so you change your advertising and
call it a new product.
8. Old Product New Product
Old Penetration Product
Market Development
New Market Conglomerate
Strategies
Market Development
10. Concentration
•Vertical Integration: The degree to which a firm operates
vertically in multiple locations on an industry’s value
chain extracting raw materials to manufacturing to
retailing.
•Horizontal Integration: by expanding the firm’s products
into other geographical locations or by increasing the
range of products and services offered to current market.
11. Concentric Diversification
Adding new, but related, products or services.
-Complementary and Supplementary.
Conglomerate Diversification
Adding new, unrelated products services.
E.g. ITC Ltd, which is mainly in Tobacco
Products diversified into paper products, hotel
business, agro products etc.