Corporate Strategy

Hai..

Ok, now we move to the next topic which is corporate strategy.. actually, I still not understand well about this topic.hehe.. it’s okay.. I will explain a little about it and we can learn it together.. okey =)

Base on Business Dictionary, corporate strategy is the overall scope and direction of a corporation and the way in which its various business operations work together to achieve particular goals.

Corporate Strategy concerned with the broad and long-term questions of ‘what business(es) the organization is in or wants to be in & what it wants to do with those businesses’.

Task involves

*      Moves to enter new businesses

*      Actions to boost combined performance of businesses

*      Ways to capture synergy among related businesses

*      Establishing investment priorities & steering corporate resources into most attractive units

Product-Market Diversification Option

*      Where firm seeks to expand both into new products & new markets

*      Single-business firm becomes a multiple-business firm since it is now operating in a different industry

Diversification Strategies is a corporate growth strategy in which a firm expands its operation by moving into a different industry. Many reasons or motives for the company decide to diversification.. And the two major of  diversification is related (concentric) diversification and unrelated (conglomerate) diversification.

Related (Concentric) Diversification

It is diversifying into a different industry but one that’s related in some ways to the organization’s current operations.

Strategic “synergy”, which is the performance of the sum of the parts is better than the whole

*      The idea that 

Synergy happens because of the interactions and the interrelatedness of the combined operations and the sharing of resources, capabilities, & distinctive competencies

Unrelated (conglomerate) diversification

It is diversifying into completely different industry from the firm’s current operations where firm move into industries where there is no strategic fit to be exploited, no meaningful value chain relationships and no unifying strategic theme. For example is GE, Walt Disney, Sara Lee and etc. Their approach is venture into any business with good profitability prospects.

Some Qoutes..

Do not offer me clothes. 

Offer me attractive looks.

Do not offer me shoes. 

Offer me comfort feet of walking.

Do not offer me a house. 

    Offer me security, comfort, and place that is clean and happy.

Do not offer me records.

Offer me leisure and sound of music.

Do not offer me things.

    Offer me ideas, emotions, ambience, feelings and benefits.

Do not offer me books.

    Offer me hours of pleasure and benefit of knowledge.

Thanks, thanks and thanks.. to both of you, miss ummi and madam huda because giving me a new knowledge.. ^_

O-Shima Restaurant - Sharing Session

Konnichiwaa.. Have a nice day everyone..

This week we have no lecture but still have to come because its replaced by sharing session about O-Shima Restaurant. It’s owner is Mrs. Asnidar Hanim together with her husband, Ashraf. They’re ex-student in one of the university in Japan. Mrs. Asnidar had degree and master in engineering but she like to involve in business. It is very different with the field that she had learnt.

For me, she was so brave because for the one who not even studied in business, she decide to open O-Shima Restaurant with a large scale and then started to open branch. Yes, she said that it is the mistake that she had done which eventually  led to his branch begin closed. But, not all the mistake will drop his master. From that experience, she start to became a good entrepreneur from one step to another step.

His restaurant is located in Shah Alam, Seksyen 26, Selangor Darul Ehsan. It provides a lot of food and its recipe originating from the country of the rising sun namely Jepun. This restaurant is the only one bumiputera ownership rights with all his food is halal to be enjoyed by people of islam in particular.

Just looking to the food make me hungry! Moreover, I still not eat anything since morning.. hee.. There is a qoute from Japan that said ‘eat with eyes’, meaning, dish must necessarily able to open his deep taste. And now it hit me.hehe..

And this is ‘Nasi Ayam Panggang Teriyaki’, which is grilled with teriyaki sauce `homemade`.. I REALLY want to try this because its more like Malaysia's food itself.. I’m not a fan of Japanese’s food.. Before this I have tried sushi or ‘whatever it is’, but it not really suit with my taste..

Sayounara.. :)

Strategies For Competing In International Markets

Hello3x.. :)

In week seven, we learn about strategies for competing in international markets. Before we go further, try to understand first what its mean by international or globalization of market. 

Globalization of markets refers to the process of integrating and merging of the distinct world markets into a single market. This process involves the identification of some common norm, value, taste, preference and convenience and slowly enables the cultural shift towards the use of a common product or service.

A number of consumer products have global acceptance. For example, Coca Cola, Pepsi, McDonalds, MTV, Sony Walkman, Levis Jeans, Indian masala dosa, Hyderabadibiriyani etc.

Talking about McDonalds, in this lecture, Miss. Ummi have shown us some video of McDonalds as an example. McDonalds has perfectly implemented international strategies. By using the transnational strategy, it has come up with an action plan that produces and sells somewhat unique, yet somewhat standardized, products in different markets.

For example, anywhere you go in the United States or even overseas, a customer is sure to come across the trademarked golden arches and the same burger and fries. Although, McDonalds targets international customers with custom approaches adapted to local tastes. 

In Singapore, the national obsession with rice extends to having rice cakes in your burger.

 

Chicken Maharaja Mac – India

McDonald’s McCurry Pan – India

McTurco Kebab – Turkey

McDonald’s CroqueMcDo – Belgium & France

McDonald’s Mega Teriyaki – Japan

McDonald’s McArabia – Egypt

McDonald’s Rosti Brekki Wrap – New Zealand & Australia

McDonald’s McSausage Burger – Germany

Strategic Choices For Competing In Foreign Markets

There are a video I want to share with all of u.. hope you will understand more and please.. 

enjoy watching it.. ^_

Blue Ocean Strategy

Hai everyone.. We meet again.. Hope we all in a good conditions.. for this entry, I want to share about Blue Ocean Strategy.. ^_

Red Ocean

The red ocean represents the existing market space. Companies in red oceans most often pursue competitive-based strategies, aiming to get a bigger share of the market from their competitors - thus the bloody competition - red ocean metaphor. This approach is called the structuralist view of strategy, meaning that companies adapt their behavior (strategy) to the existing industry's conditions.

However, this approach is limited. Due to globalization, lowering cost of production and availability of information, the competition is more fierce some than ever in most industries, putting more pressure on companies and shrinking their profit margins. In this competition race, products and services tend to become commoditized much faster.

Blue Ocean

The blue oceans are new markets created by companies following conscious strategic decisions. The creation of a new market space gives companies a natural monopolistic position, which the company can take advantage from. This is called the reconstructionist view of strategy, meaning that companies recreate the boundaries of an industry (which are mental barriers, anyway), as a result of the strategy they pursue.

However, Blue Ocean Strategy does not encourage companies to behave monopolistically, as it will hurt them in longer term. Instead, companies must price their service/product strategically, to win a mass of buyers, which results in a win-win situation for the buyers (value proposition), for the company (profit proposition) and for the employees (people proposition).

The differences between the two approaches:

“Blue ocean strategies are really working and more companies are using them to find growing, unmet needs in the new, ever-evolving global marketplace. I have seen this occur in industries as diverse as hydration system manufacturing, financial services, and construction."  

Andrea SimonPrincipal & Founder, Simon Associated Management ConsultantsForbes

            Ok, bye.. see you in another entry J

The Five Generic Competitive Strategies

Assalamualaikum ^_

hello.. its already week 5.. time goes without we realize it.. time is like a sword, in case you do not cut it, surely it cut you.. hope we do not belong to dispose of their time, insya Allah :)

ok, in this week we learn about generic competitive strategies. We have asked to give an example for every subtopics. The interesting in this week is we try a new things.. But.. It cost a little.hehe..

There are three strategies which is cost leadership, differentiation, focus (market segmentation) and under focus has cost focus and differntiation focus. I will insert an example for every subtopics.. ^_

The cost leadership strategy

A firm tries to reduce its overall production and distribution costs. It wins market share by appealing to cost-conscious customers. It sets the lowest prices in the target market segment, or at least the lowest price to value ratio.

Three ways to achieve it was economies of scale, low direct and indict operating cost and control over the supply chain.

Achieved market share by keeping low inventories and only building computers to order, procurement advantages from preferential access to raw materials or backward integration.

Differentiation

A company concentrates on differentiating the products in some way in order to compete successfully. In order words, making their products or services different from and more attractive than their competitors. Large organizations pursuing a differentiation strategy need to stay agile with their new product development processes. Otherwise, they risk attack on several fronts by competitors pursuing Focus Differentiation strategies in different market segments.

Differentiated through brand power

Focus (Market Segmentation)

The firm focuses its marketing effort on serving a defined, focused market segments with a narrow scope by tailoring its marketing mix to these specialized markets, it can better meet the needs of that target market. The firm typically looks to gain a competitive advantage through product innovation and/or brand marketing rather than efficiency.

It is most suitable for relatively small firms but can be used by any company. A focused strategy should target market segments that are less vulnerable to substitutes or where a competition is weakest to earn above-average return on investment.

Serve highest end of wristwatch market (premium pricing and image)

The focus strategy has two variants, which is

1.   Cost Focus

A firm seeks a cost advantage in its target segment, it exploits differences in cost behavior in some segments.

Focus on the lower cost

2.   Differentiation Focus

A firm seeks differentiation in its target segment. It exploits the special needs of buyers in certain segments.

Ferrari, targets high performance sports car segment and due to differentiation based on design, high performance grand prix records which allows it to charge a premium price.

ok, that all for this time..

Internal Environment

Hai.. This week we have learnt about internal environment. Among them are..

SWOT analysis

SWOT analysis (alternatively SWOT Matrix) is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective.

Setting the objective should be done after the SWOT analysis has been performed. This would allow achievable goals or objectives to be set for the organization.

·         Strengths: characteristics of the business or project that give it an advantage over others

·  Weaknesses: characteristics that place the team at a disadvantage relative to others

·     Opportunities: elements that the project could exploit to its advantage

·        Threats: elements in the environment that could cause trouble for the business or project

Identification of SWOTs is important because they can inform later steps in planning to achieve the objective.

SWOT analysis aims to identify the key internal and external factors seen as important to achieving an objective. The factors come from within a company's unique value chain. SWOT analysis groups key pieces of information into two main categories:

1.   internal factors – the strengths and weaknesses internal to the organization

2.   external factors – the opportunities and threats presented by the environment external to the organization

Analysis may view the internal factors as strengths or as weaknesses depending upon their effect on the organization's objectives. What may represent strengths with respect to one objective may be weaknesses (distractions, competition) for another objective.

Value Chain

A value chain is a chain of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. The concept comes from business management and was first described and popularized by Michael Porter.

"The idea of the value chain is based on the process view of organizations, the idea of seeing a manufacturing (or service) organisation as a system, made up of subsystems each with inputs, transformation processes and outputs. Inputs, transformation processes, and outputs involve the acquisition and consumption of resources - money, labour, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits."