Chapter 8: Selecting Corporate-Level Strategies

Conclusion

This chapter explains corporate-level strategy. Executives grappling with corporate-level strategy must decide in what industry or industries their firms will compete. Many of the possible answers to this question involve growth. Concentration strategies involve competing within existing domains to expand within those domains. This can take the form of market penetration, market development, or product development. Integration involves expanding into new stages of the value chain. Backward integration occurs when a firm enters a supplier’s business while forward vertical integration occurs when a firm enters a customer’s business. Diversification involves entering entirely new industries; this can be an industry that is related or unrelated to a firm’s existing activities. Sometimes being smart about corporate-level strategy requires shrinking the firm through retrenchment or restructuring. Finally, portfolio planning can be useful for analyzing firms that participate in a wide variety of industries.

Exercises

  1. Divide your class into four or eight groups, depending on the size of the class. Each group should create a new portfolio planning technique by selecting two dimensions along which companies can be analyzed. Allow each group three to five minutes to present its approach to the class. Discuss which portfolio planning technique seems to offer the best insights.
  2. This text has discussed Disney in several chapters. Imagine that you were hired as a consultant by General Electric (GE), a firm that competes with Disney in the movie, television, retail products, interactive, theme park, and cruise line industries. Choose three of these industries and explain what actions you would recommend that GE take in these industries to gain advantages over Disney?

Attributions

Figure 8.2:
Coke Pepsi Cans by Ryan Glenn (https://www.flickr.com/photos/gongus/3025660880/) used under CC BY 2.0 Licence  (first);

Pepsi Challenge by Sean Loyless (http://www.flickr.com/photos/haggismac/5090028513/) used under CC BY 2.0 Licence (second);

First coffee of the semester. by Wesley Dobbs (http://www.flickr.com/photos/wesdobbs/3883583363/) used under CC BY 2.0 Licence  (third);

Up close with the music station thing by Thomas Duesing (http://www.flickr.com/photos/tfduesing/75826176/) used under CC BY 2.0 Licence  (fourth);

Gillette Fusion 1 by Naotake Murayama (https://www.flickr.com/photos/naotakem/108650269/) used under CC BY 2.0 Licence  (fifth);

Mach-3-Razor by Evan-Amos (http://wikimediafoundation.org/wiki/File:Mach-3-Razor.jpg) is in the Public Domain (sixth)

Figure 8.5:
Air Canada 777 (7188398841) by Simon_sees (http://commons.wikimedia.org/wiki/File:Air_Canada_777_(7188398841).jpg) used under CC BY 2.0 Licence  (first);

Seattle’s Best by Rachel Sarai (https://www.flickr.com/photos/sarairachel/7513449136/) used under CC BY 2.0 Licence (second);

Laptop HP by Shleiderbmx (http://commons.wikimedia.org/wiki/File:Laptop_HP.JPG) used under CC BY 2.0 Licence (third);

’01-’05 Chrysler PT Cruiser Wagon by Bull-Doser (http://commons.wikimedia.org/wiki/File:%2701-%2705_Chrysler_PT_Cruiser_Wagon.JPG) is in the Public Domain (fourth);

Adderall bottle and capsules by Ryanaxp (http://commons.wikimedia.org/wiki/File:Adderall_bottle_and_capsules.jpg) is in the Public Domain (fifth)

Figure 8.7:
AmericanApparelMalibu by American_Apparel (http://wikimediafoundation.org/wiki/File:AmericanApparelMalibu.jpg) used under CC BY 2.0 Licence  (first);

American Apparel factory and distribution center, Los Angeles by AA (http://wikimediafoundation.org/wiki/File:American_Apparel_factory_and_distribution_center,_Los_Angeles.jpg) used under CC BY-SA 3.0 Licence  (second);

Dov Charney on young entrepreneur cover by dovcharney (http://www.flickr.com/photos/dovcharney/2885342063/) used under CC BY 2.0 Licence  (third);

Flickr – urbantofu – american apparel by Urban Tofu (http://wikimediafoundation.org/wiki/File:Flickr_-_urbantofu_-_american_apparel.jpg) used under CC BY 2.0 Licence  (fourth);

Hollywood Blvd. 022010Sa by vmiramontes (http://www.flickr.com/photos/vmiramontes/4376957889/) used under CC BY 2.0 Licence  (fifth);

American Apparel by Nicolas Nova (http://www.flickr.com/photos/nnova/3399896671/) used under CC BY 2.0 Licence  (background)

Figure 8.11:
Prescriptives Flawless Skin Concealer by ookikioo (https://www.flickr.com/photos/ookikioo/314692747/in/photostream/) used under CC BY 2.0 Licence  (first);

DKNY_060309_2514 by Jessica Sheridan (http://www.flickr.com/photos/16353290@N00/4043846042/) used under CC BY 2.0 Licence  (second);

Tokidoki for Smashbox cosmetics by porcupiny (https://www.flickr.com/photos/porcupiny/1926961411/in/photostream/) used under CC BY 2.0 Licence (third);

Estee Lauder Sensuous by daveynin (http://www.flickr.com/photos/daveynin/2726423708/) used under CC BY 2.0 Licence  (fourth);

Studio DNA – Bumble and bumble by Shortcuts Smarter Business (http://www.flickr.com/photos/57283318@N07/5303842500/) used under CC BY 2.0 Licence (fifth);

facial soap by Joanne Saige Lee (https://www.flickr.com/photos/crystalliferous/3024189623/in/photostream/) used under CC BY 2.0 Licence  (sixth);

‘even better’ skin tone corrector by Joanne Saige Lee (https://www.flickr.com/photos/crystalliferous/3025018504/in/photostream/) used under CC BY 2.0 Licence  (seventh);

Bobbi Brown Stonewashed Nudes Palette by ookikioo (http://www.flickr.com/photos/ookikioo/856924791/) used under CC BY 2.0 Licence (eighth);

MAC Cosmetics by Church Street Marketplace (http://www.flickr.com/photos/churchstreetmarketplace/4180164459/) used under CC BY 2.0 Licence  (ninth);

Aveda Suits – EVO Conference by Betsy Weber (http://www.flickr.com/photos/betsyweber/5915582379/) used under CC BY 2.0 Licence  (tenth);

Jo Malone Perfume by Mohd Althani (http://www.flickr.com/photos/33707373@N03/4643563760/) used under CC BY 2.0 Licence  (eleventh)

Figure 8.13:
P1010451 by Dr._Colleen_Morgan (https://www.flickr.com/photos/colleenmorgan/2216823306/) used under CC BY 2.0 Licence (first);

Kamstrup-Metro energy meter by Gert Skriver (http://commons.wikimedia.org/wiki/File:Kamstrup-Metro_energy_meter.jpg) used under CC BY 2.0 Licence  (second);

Briefs-FruitoftheLoom-20080226 by Doommaster1994 (http://commons.wikimedia.org/wiki/File:Briefs-FruitoftheLoom-20080226.jpg) is in the Public Domain (third);

Brick by Andrewlister (http://commons.wikimedia.org/wiki/File:Brick.jpg) is in the Public Domain (fourth);

Asiana Airlines captains hat (6221725835) by InSapphoWeTrust (http://commons.wikimedia.org/wiki/File:Asiana_Airlines_captains_hat_(6221725835).jpg) used under CC BY-SA 3.0 Licence   (fifth);

Morris-Chair-Ironwood by Resonance african furniture (http://commons.wikimedia.org/wiki/File:Morris-Chair-Ironwood.jpg) is in the Public Domain (sixth);

Broodmes by T Houdijk (http://commons.wikimedia.org/wiki/File:Broodmes.jpg) is in the Public Domain (seventh);

Chocolate candy piece by visualpanic (http://commons.wikimedia.org/wiki/File:Chocolate_candy_piece.jpg) used under CC BY 2.0 Licence  (eighth);

Cheyenne Frontier Days Train – Pierce, Colorado by Jerry Huddleston (https://www.flickr.com/photos/huddleston/14750632575/) used under CC BY 2.0 Licence  (ninth)

Figure 8.17:
CES 2012 – Motorola (6764012909) by CES 2012 – Motorola (http://commons.wikimedia.org/wiki/File:CES_2012_-_Motorola_(6764012909).jpg) used under CC BY 2.0 Licence (first);

Toyota Camry LE by IFCAR (http://commons.wikimedia.org/wiki/File:Toyota_Camry_LE.jpg) is in the Public Domain (second);

An aol.com email address is the duncecap of the internet by Lee (https://www.flickr.com/photos/lazzarello/5454431231/) used under CC BY-SA 3.0 Licence  (third);

EPROMs National Semiconductor by yellowcloud (http://commons.wikimedia.org/wiki/File:EPROMs_National_Semiconductor.jpg) used under CC BY 2.0 Licence  (fourth);

DB-102b by Caseman (http://commons.wikimedia.org/wiki/File:DB-102b.jpg) used under CC BY-SA 3.0 Licence  (fifth)

Figure 8.20:
Star* by Indolences (http://commons.wikimedia.org/wiki/File:Star*.svg) is in the Public Domain (first);

Vraagtaken by Ogre (http://commons.wikimedia.org/wiki/File:Vraagteken.svg) is in the Public Domain (second);

Cows, Lancaster County by Tony Fischer (https://www.flickr.com/photos/tonythemisfit/4101214805/) used under CC BY 2.0 Licence  (third);

Raskal by fugzu (http://commons.wikimedia.org/wiki/File:Raskal.jpg) used under CC BY 2.0 Licence (fourth)

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