LEVELS

OF
STRATEG
The most important
thing is to set goals.
Training is a waste
of time if you don't
have goals."  
– Samantha
Riley
 Levels of Strategy
Underlying Assumption

 Managers have a universal goal of

making their organizations bigger
and more profitable
 1. Introduction
 Enterprise strategy can be formulated and
implemented at three different levels:
- Corporate level.
- Business unit level
- Functional or departmental level
 At the corporate level, organization is
responsible for creating value through its
businesses. The company does so by managing
portfolio of businesses, ensuring that the
businesses are successful over the long term,
developing business units & sometimes
ensuring that each business is compatible with
others in its portfolio.
 1. Introduction
 The strategy may be about competing and
surviving as a firm, one can argue that
products, not corporations compete and
products are developed by business units.
The role of the corporation is to manage its
business units and products so that each is
competitive and each contributes to
corporate purposes.
 While the corporation must manage its
portfolio of businesses to grow and survive,
the success of a diversified firm depends
upon its ability to manage each of its product
lines.
 2. Levels of Strategy
 There are Three Hierarchical Levels of
Strategy and they are as follows: -
- Corporate Strategy i.e. What business
should you be in? Looks at the whole
range of business opportunities.
- Business Strategy i.e. Battle plans,
tactics used to fight the competition in
the industry that your company currently
participates in
- Functional Strategy i.e. Operational
methods and value adding activities that
company choose for its business.
Corporat
e Level
Strategy
A) Corporate Level Strategy
 Corporate level strategy fundamentally is concerned
with selection of businesses in which company
should compete & with development and
coordination of that portfolio of businesses.
 Corporate level strategy is concerned with:
- Reach i.e. defining the issues that are corporate
responsibilities. These might include identifying the
overall vision, mission, & goals of corporation, the
type of business corporation should be involved, and
the way in which businesses will be integrated and
managed.
A) Corporate Level Strategy
- Competitive Contact i.e. defining where in your
corporation competition is to be localized.
- Managing Activities & Business
Interrelationship i.e. corporate strategy seeks to
develop synergies by sharing and coordinating staff and
other resources across business units, investing
financial resources across business units, and using
business units to compliment other corporate business
activities.
- Management Practices i.e. corporations decide
how business units are to be governed: through direct
corporate intervention (centralization) or through
autonomous government (decentralization).
 A) Corporate Level
Strategy
 Thus to sump up: - Corporate level

strategy is concerned with:

- Reach.
- Enterprise – wide cross – business
process management.
- Competitive Contact.
- Managing Activity & Business
Interrelationship
- Management Practices
Busines
s
Strateg
 B) Business Strategy
 A strategic business unit may be any profit
center that can be planned independently
from the other business units of your
corporation. At the business unit level, the
strategic issues are about both practical
coordination of operating units and about
developing and sustaining a competitive
advantage for the products and services that
are produced. At the business level, the
strategy formulation phase deals with:
- Positioning the business against rivals.
- anticipating changes in demand &
technologies and adjusting the strategy to
accommodate them.
 B) Business Strategy
- Influencing the nature of competition through
strategic actions.
 Thus, to sum up: - At the business unit level, the
strategy formulation & implementation deals
with:
- Positioning and differentiating the business
and/or products against rivals.
- Business level cross functional process mgmt.
- Anticipating changes in technology, customer
perception and adjusting strategy to
accommodate them.
- Influencing the nature of competition through
strategic actions such as virtual integration and
through political actions
- Building strategic partnership & co – Innovating
with other business units, partners, & customers
Function
al
Strategy
 C) Functional Strategy
 The functional level of organization is the
level of the operating divisions and
departments. The strategic issues at the
functional level are related to functional
business processes and value chain.
Functional level strategies in R&D,
operations, manufacturing, marketing,
finance, and human resources involve the
development and coordination of
resources through which business unit
level strategies can be executed
effectively and efficiently.
 C) Functional Strategy
 Functional units of organization are involved in
higher level strategies by providing input into the
business unit level and corporate level strategy,
such as providing information on customer
feedback or on resources and capabilities on
which the higher level strategies can be based.
Once the higher level strategy or strategic intent
is developed, the functional units translate them
into discrete action plans that each department
or division must accomplish for the strategy to
succeed.