Unit 1 - Corporate Strategy for International Business.ppt

UNIT -1
CORPORATE
STRATEGIC
PLANNING

OUTLINE OF THE PRESENTATION
● CORPORATE STRATGIC SHIFTS
● NEED FOR STRATEGIC MANAGEMENT
● WHY STRATEGY?
● CORPORATE STRATEGY – A MASTER PLAN

CORPORATE STRATEGIC
SHIFTS
Big bang changes in the scope or
growth of Business often results in
Breakthrough Strategic Thinking.
TATA GROUP OF COMPANIES
GO GLOBAL DECISIONS

TATA TEA ACQUISITION
OF TETLEY
● Tata Global Beverages
● Acquiring Tetley
● Tetley is the largest
/company of Tea in the
United Kingdom and Canada
and second largest in United
States
● TATA is now the fifth in top
tea companies in the world

The Global Player –
TATA Motors
Acquisition of
● Daewoo Heavy Vehicles of
South Korea.
● Jaguar Land Rover - Britain

Acquisition of TATA
Steel
● Natsteel of Singapore
(2004)
● Millenium Steel of
Thailand (2005)
● Corus – Anglo Dutch Steel
maker ( 2007)
Enabled TATA one of the
largest producer of Steel in
the World.
(Currently in 7th position)

ITC GROUP OF
COMPANIES
● Tobacco Firm to Diversification

WHY STRATEGY?
Successful Companies due to good Strategy Unsuccessful Companies due to lack of
Strategic Planning
Singapore Airways US Airways
Dell Computers Compaq and Apple
Maruthi Ambassador and Padmini
Virgin Blue British Airways
Airtel Reliance

NEED FOR STRATEGIC MANAGEMENT
Strategic Management is concerned about the long-term development of an organisation with
a clear vision about the organisational purpose, scope of activities and objectives. The
context or the need for Strategic Management has been very beautifully and succintly
articulated by renowned Management Guru Peter Drucker:
Management has "no choice but anticipate the future, to attempt to mold it, and to
balance short-range and long-range goals. The future will not just happen if one
wishes hard enough. It requires decision now. It imposes risk - now. It requires
action - now. It demands allocation of resources - now. It requires work - now."
These observations highlight the essence of what is known as Strategic Management/
Business Policy/Corporate Strategy/Corporate Planning.-

CORPORATE STRATEGY - A MASTER PLAN
Plan for accomplishing the corporate vision by
consolidating/strengthening its competitive
position,- based on its:
(1) vision/mission, philosophy and ethics,
(2) strengths and weaknesses, and
(3) environmental opportunities and threats.

MASTER PLAN
It connotes the following:
1. Strategic management is a means to the end. The end, i.e., the purpose, is to realise
the corporate vision/mission.
2. Corporate strategy is a master plan - a plan that encompasses the entire organisation
for overall development. It is a long-term plan that lays down the roadmap for the
overall development of the organisation. All sub-plans, like divisional or sectional
plans (SBU plans) shall be aligned with the scope and vision/objectives of the master
plan, i.e., corporate strategy.
3. It aims at gaining/enhancing competitive advantage vis-à-vis other firms in the
industry.

MASTER PLAN
4. It is based on a SWOT analysis, i.e., corporate strategy defines the business portfolio (scope of the
business). That is, on the basis of the SWOT analysis, existing business(es) may be dropped or
further strengthened or new ones may be added.
5. Corporate plan, being a master plan, is likely to be complex in nature. The complexity tends to
increase with the increase in the size and diversity of the business.
6. A corporate plan normally is characterised by the need for large resource commitments -investing
today for tomorrow. Further, strategies pertaining to the different businesses may call for resource
reallocation. Thus, strategic management is often characterised by resource mobilisation and
reallocation.
7. The vision/mission, philosophy and values of the organisation have important bearing on the
strategy. They may influence how the business shall be conducted or fostered or the scope of the
business (i.e., the type of business the organisation can be or shall not be in.)

Unit 1 - Corporate Strategy for International Business.ppt

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Unit 1 - Corporate Strategy for International Business.ppt