In the business field, corporate strategy is defined as factors that encompass an organization’s corporate actions, which work towards ensuring that the overall goals and objectives are attained while growing the competitive advantage of the organization. This means that the corporate strategy practiced in an organization play an important role in shaping the decisions made by top management teams (Kirwan, 2016). Samsung, one of the giant players in the electronics industry with a corporate strategy that is characterized by a high level of flexibility where decisions are made according to the general business and market conditions. The top management team at the organizations reads the prevailing conditions in the market, as well as in business world before deciding the corporate strategy they will employ to maintain their competitive advantage in the competitive environment they operate. This is why the organization has been changing its core function ever since it was incorporated. For example, the company started in 1938 as a small grocery store and switched two years later to a noodle business, and in 1950; it changed its core operations from noodle into a sugar-producing organization. In 1954 and 1956, the organization changed its core business and started in engaging in a woolen mill and insurance and securities business respectively.
What is Functional Strategy?
Functional corporate strategies are the type of policies that aim at improving the implementation of all operations within a business organization. These types of strategies include human resources strategies that aim at ensuring that employees perform their duties effectively and efficiently, as well as marketing strategies whose aim is to ensure that the firm’s goods and products are marketed efficiently and that the set marketing goals are attained. Samsung Kenya has been using functional strategy to help advance its competitive advantage in the electronic industry (Kirwan, 2016). The organization has a perfect marketing strategy that has enabled it to sell its products such as its smartphones in all countries across the world. The organization Human resource strategy also ensures that the organization only hires employees with the necessary skills and experience to produce high-quality products, and at the same time be in a position to push them out into the competitive market (Carroll, 2017). This is one of the ways the organization has been able to maintain its competitive advantage.
Stability Strategies in Business
In the business industry, there is what is known as a stability strategy, which are approaches undertaken by a business organization to maintain stability. Stability is maintained by ensuring that an organization manages its market position, operations, and market size. This strategy is best maintained when an organization is operating in an uncertain environment where bad decisions can have severe financial and business consequences that can affect the market in a negative manner (Kirwan, 2016). These strategies include the no-change strategy, the profit strategy, and the caution strategy. The no-change approach involves a deliberate decision made to make no considerable changes in the strategy regarding different aspects of the organization. The profit strategy, on the other hand, involves only making decisions that advance the profits and nothing else while the cautious strategy consists of taking a wait and see approach before making any decision that can have any form of impact on the organization. The advantage of these strategies is that they take a cautious approach; hence, they can protect the organization from unnecessary risks (Carroll, 2017). The major disadvantage of these strategies is that the organization may fail to take advantage of an opportunity that presents itself.
Competitive and Cooperative Strategies
Competitive strategy in a business organization can be defined as the long term strategy undertaken by the management team of an organization of a company with the primary objective being to gain a competitive advantage over other players in its industry (Kirwan, 2016). This strategy helps in creating a defensive position in the market and generating a high Return on Investment. The corporation strategy, on the other hand, is the approach taken by two or more business organizations to work together to gain a competitive advantage in their industry. An example of this can happen when a market characterized by a few sellers has the sellers working together to control the price of their products instead of competing with one another.
What are the trade-offs (pros and cons) between an internal and an external growth strategy?
In economics and decision-making process, trade-off requires the trading of one item for another. This term is typically used as an opportunity cost that forms the most preferred possible alternative hence providing an organization with the chance to increase its presence in the industry. Clear trade-offs are the ones suited for international strategy because they help an organization gain a competitive advantage in foreign markets (Kirwan, 2016). For example, an organization that wants to expand and start selling its products internationally can begin by coming up with international partners who will be charged with the responsibility of ensuring that they implement the best strategies that can help the organization to succeed in the new foreign market.
Carroll, A. (2017). Business Strategy & Society Ethics, Sustainability & Stakeholder
Management. Mason, OH: Cengage LearningKirwan, C. (2016). Improving learning transfer: A guide to getting more out of what you put into your training. New York, NY: Routledge.
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