Strategic management: Levels of strategy

Corporate strategy: The corporate center is at the apex of the organization. It is the head office of the firm and will contain the corporate board. The planning view of strategy assumes that all strategy was formulated at corporate level and then implemented in a ‘top-down’ manner by instructions to the business divisions. During the 1980s, high profile corporate planners like IBM, General Motors and Ford ran into difficulties against newer and smaller ‘upstart’

                  Organization chart showing corporate, strategic business unit & functional strategies.

Competitors who seemed to be more flexible and entrepreneurial. One consequence was the devolution of responsibility for competitive strategy to strategic business units (S.B.U.).

Corporate strategy today typically restricts itself to determining the overall purpose and scope of the organization. Common issues at this level include:

·                Decisions on acquisitions, mergers and sell-offs or closure of business units;

·                Conduct of relations with key external stakeholders such as investors, the government and regulatory bodies;

·                Decisions to enter new markets or embrace new technologies (sometimes termed diversification strategies);

·                Development of corporate policies on issues such as public image, employment practices or information systems.

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