Corporate Level Strategies

Corporate level strategies are used to address a company’s entire scope. Corporate strategy tops the planning pyramid and highlights the entity’s main reason for existence. It should be viewed as the final destination of the business. Corporate level strategies are long-term, uncertain, complex, geared towards overarching other goals, dynamic, and extensively impactful (Bogomyagkov & Machulskyi, 2012).

Stability

When a business is in a state that lacks significant growth but performs well, it may opt for stability as a corporate decision. This decision enables the entity to retain its current market share through the provision of the usual products and services. A company that chooses this decision encounters less risk due to a lack of new product developments, which can lead to a firm’s failure. The strategy decision facilitates better allocation of resources to maintain the current efficiencies, thus retaining the main revenue sources.

Stability decision presents various challenges or disadvantages. First, most managers are accustomed to the company’s routines and fail to consider new alternatives that may be present within its environment as opportunities. Second, the company ignores all options that provide opportunities for diversification, which creates a trade-off between current strategies and potential opportunities for further growth. Thirdly, entities that choose this strategy may experience failure as other competitors improve their products and services consistently and acquire clients from different companies’ market shares (Puranam, 2016).

Expansion

The expansion strategy is ideal when a company seeks to venture into a new market. Its main advantages include expanding the product or service portfolio, improving current services or products, and incrementing revenue due to acquiring a wider customer base. However, this strategy can lead to a loss of resources if the research and development process is faulty. This fault results in the loss of significant market share due to a lack of satisfaction after consuming the new goods and services. Finally, a company that fails to consider the cultural aspects that affect the new market is unable to penetrate and find acceptance (Puranam, 2016). This strategy is associated with high risk and high reward as well.

Retrenchment

A company that intends to significantly reduce its activity’s scope can adopt this strategy. The retrenchment approach is ideal for an organization that is facing different difficulties in the market. Such difficulties come from the internal and external environments, forcing the organization to react for survival (Puranam, 2016). As the danger of decline looms, the management has a chance to take action and solve the causes of the problem. For instance, diminishing profitability or product popularity requires an organization to investigate the main cause and find a solution. Thus, the strategy saves companies from collapse. The main challenge of the strategy is the risk associated with the wrong diagnosis. If an organization concentrates resources and efforts on the wrong issue, the risk of collapse increases. During this period, the company may record less profit, increase operational costs, and lose market share, which will last for as long as the company seeks a solution.

A company’s strategic decision for its corporate level affects marketing at the lower levels significantly (Gaskill & Winzar, 2014). A company that chooses growth over retrenchment applies different marketing approaches. For instance, the advertising messages are designed to attract more clients and inform each segment about the perceived benefits associated with each product/service. The applied pricing strategies vary from the competitors’, while distribution is enhanced by ensuring that multiple places can hold the item for sale purposes. Overall, the corporate level decision determines the performance of a business.

Bibliography

Bogomyagkov, Y. & Machulskyi, I., (20120. Corporate and business level strategies at MNEs.

Gaskill, A. & Winzar, H. F., (2014). Marketing’s decision influence within the firm. Journal of Empirical Generalisations in Marketing Science, 14(2), pp. 1-19.

Puranam, P., (2016). Corporate Strategy Decision Making, Demystified.

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Lesson 5 Unit 3

Scenario

You are part of PritWaferMouseTrooper, a consulting firm that specialise in strategic marketing. You are part of the sales team and you have contacted CraftSupplies, a company specialising in Art and Craft Supplies.

Corporate Level Strategies

Instructions

In addition to your service, your company has its own blog and you have been asked to write an individual blog post.

You should read the business section of newspaper and write a blog entry reviewing at least 3 strategic marketing decisions made at corporate level, weighing their pros & cons.

You should also reflect on how strategic marketing decisions influence marketing at lower levels within the organisations.

Your blog reflection must be backed up by theory which must be appropriately referenced.