The document outlines the hierarchy of strategies used in strategic management. It discusses corporate level strategies that affect the whole organization, business level strategies that gain competitive advantage in specific markets, and functional level strategies for different departments. Functional strategies include operational strategies for quality and production, financing strategies for funds management, marketing strategies for segmentation and promotion, and human resources strategies for recruitment and compensation.

1. Hierarchy of Strategies
Ideas for TODAY and TOMORROW

2. Topics
 Meaning of Strategy & Strategic Management
 Importance of Strategy
 Levels (Hierarchy) of Strategies
 Corporate Level Strategy
 Business Level Strategy
 Functional Level Strategy

3. Strategy & Strategic Management
 Strategy is a comprehensive master plan stating HOW the
corporation will achieve its mission and objective.
 Strategic management is the continuous planning,
monitoring, analysis and assessment of all that is necessary
for an organization to meet its goals and objectives.

4. Importance of Strategy
 Strategic Management seeks to co-ordinate & integrate the
activities of the various functional areas of a business in
order to achieve long-term organizational objectives.
 The initial task in strategic management is typically the
compilation & dissemination of the vision & the mission
statement. This outlines, in essence, the purpose of an
organization.

5. Importance of Strategy (continued…)
 Strategies are usually derived by the top executives of
the company & presented to the Board of Directors in
order to ensure they are in line with expectations of the
stakeholders.
 The implications of the selected strategy are highly
important.
 All strategic planning deals with atleast 1 of 3 questions
:
a) Where are we now..???
b) Where do we want to go..???
c) How do we get there..???

6. Levels (Hierarchy) of Strategies

7. Corporate Level Strategy
 A corporate level strategy involves all the strategic decisions
that are taken by the top executives of the company that
affects the whole organization or company.
 A Balance Scorecard approach
 Grand Strategies :
a) Growth/Expansion Strategy (Internal & External)
b) Stability (it is pause or no change strategy)
c) Retrenchment (Regrouping through cost & asset reduction to
reverse declining sales & profit)
d) Combination Strategy (it is the strategy where more than 1 grand
strategy is used)

8. Business Level Strategy
 Business level strategy is an integrated and co-ordinated
set of commitments & actions the firm uses to gain a
competitive advantage by exploiting core competencies
in specific product markets.
 The purpose of this strategy is :
a) to create differences between position of a firm & its
competitors
b) firm must make a deliberate choice to :
▬ perform activities differently
▬ perform different activities

9. Business Level Strategy (continued…)
 Competitive Strategy
a) Differentiation strategy (Approach under which a
firm aims to develop & market unique products for
different customer segments)
b) Low cost strategy (It describes a way to establish the
competitive advantage)
c) Focus strategy (It is usually employed where the
company knows its segment & has products to
competitively satisfy its needs)

10. Functional Level Strategy
 The functional level of the organization is the level of
operating divisions & departments.
 Functional level strategies in Marketing, Finance,
Human Resources, Operations and Research &
Development involve the development & co-ordination
of resources through which business unit level strategies
can be executed efficiently & effectively.
 Strategies for each functions in the organization are as
follows :

11. Functional Level Strategy (continued…)
 Strategies at operational level are as follows :
a) Quality
b) Capacity
c) Technology
d) Product
e) Facility
f) Product service mix
Functional Strategy – Operating Strategy
Quality
Product
Technology

12. Functional Level Strategy (continued…)
 Strategies at financial level are as follows :
a) Procurement of finance
b) Utilization of finance
c) Financial ratio analysis
d) Financial strategy
Functional Strategy – Financing Strategy

13. Functional Level Strategy (continued…)
 Strategies at marketing level are as follows :
a) Market segment
b) Product positioning
c) Product Life Cycle (PLC)
d) Pricing
e) Distribution
f) Promotion
Functional Strategy – Marketing Strategy

14. Functional Level Strategy (continued…)
 Strategies at Human Resources level are as follows :
a) Recruitment
b) Selection
c) Orientation
d) Training & Development
e) Career Planning
f) Compensation
Functional Strategy – Human Resources Strategy