Master of Business Administration - MBA Semester 4 MB0052 Strategic Management and Business Policy Assignment (60 Marks) Q1.

. Explain the corporate strategy in different types of organization. Corporate Strategy This is regarding the general function and scope of the business to meet the stakeholders expectations. As it is significantly influenced by the investors in the business, it is also called the critical level strategy. Corporate strategy performs the following functions: It provides a dual approach to problem solving. Firstly, it exploits the most effective means to overcome difficulties and face competition. Secondly, it assists in the deployment of scarce resources among critical activities. It focuses attention upon changes in the organizational set up, administration of organizational process affecting behaviour and the development of effective leadership. It offers a technique to manage changes. The management is totally prepared to anticipate, respond and influence to look at changes. It also offers a different way of thinking. It furnishes the management with a perspective whereby, the latter gives equal importance to present and future opportunities. It provides the management with a mechanism to cope with highly complex environment characterized by diversity of cultural, social, political and competitive forces.

KINDS OF CORPORATE STRATEGY There are four grand strategic alternatives. They are Stability Expansion Retrenchment Any combination of these three. These strategic alternatives are also called as grand strategies. A brief description about them are as follows: a) Stability Strategy- It is adopted by an organization when it attempts to improve functional performance. They are further classified as follows: i) No change strategy ii) Profit strategy iii) Pause/Proceed with caution strategy b) Expansion Strategy:- It is followed when an organization aims at high growth.

Q2. What is the role consultants play in the strategic planning and management process of a company? Is it an essential role? The term strategic planning came into existence which is currently being used to describe a phase of strategic decision-making. Strategic management model is generally known as strategic planning model. A strategic planning model is selected to devise and implement the strategic management plan of a particular organisation. However, it has been proved that no strategic planning model is perfect. Every company regularly designs its own strategic planning model by choosing a model and transforming it as the company proceeds to formulate its strategic management plan procedures. Organisations can choose from a large number of strategic planning model options that are available. Strategists are the individuals involved in the strategic management process. They craft the strategy to be implemented in the organisation. Strategists think, plan, and implement relevant strategy in the organisation to obtain a long term goal. Strategists are the silent partners in strategic literature. The role of strategists in decision making varies according to the different management levels in the organisation. The strategic management process requires competent individuals to ensure its success. Therefore to craft the strategic management, strategists will analyse the position of strategic decisions made in the organisation. Generally top management, board of directors and planning staff are the most significant individuals involved in strategic management process in organisations. Role of strategists at various management levels The various management levels where the roles of strategists can be seen include. Top level management Board of directors Planning staff

Top level management The overall responsibility of the organisation rests on the top level management. Top level management relatively refers to a small group of people which includes president, chief executive officer, vice president, and executive vice president. Board of directors Most of the organisations consist of board of directors elected by stakeholders. They are bestowed with ultimate authority and responsibility. Typically a chairperson is elected in the board of directors who is responsible for overseeing business activities, and they form standing committees which meet regularly to conduct their business. 2

Planning staff Planning staff, usually called as planning staff personnel are a group of people assigned by the top level management. They plan the levels of strategies to be implemented in a sequential order. Planning staff are the sub-ordinate team to the top level management. Planning staff management and top level management work flow goes hand in hand for planning and developing strategic management. Q3. What is strategic audit? Explain its relevance to corporate strategy and corporate governance. The external environment in which a business operates can create opportunities which a business can exploit, as well as threats which could damage a business. However, to be in a position to exploit opportunities or respond to threats, a business needs to have the right resources and capabilities in place. An important part of business strategy is concerned with ensuring that these resources and competencies are understood and evaluated - a process that is often known as a "Strategic Audit". corporate strategy requires multiple business models, each business model requires a different strategy. Integrated global demand and supply chains require different degree of collaboration among stakeholders. The objective of corporate strategy should be to revise these competitive forces in a way that improves the position of the organisation. Corporate Governance Corporate governance is the reflection of the business culture, policies, relationship with the stakeholders and the organisations commitment to its values. It refers broadly to the rules, processes and laws by which a business is operated, regulated and controlled properly. Well defined and enforced corporate governance provides a structure that works for the benefit of every individual and is concerned over the accepted ethical standards and best practices followed in an organisation. Corporate governance is influenced by the internal factors like officers, stockholders, nature of a corporation, etc. and the external factors like consumer groups, clients and the government regulations. Good corporate governance is the key to the integrity of corporations, financial institutions and markets. It is also essential to the healthy economy and the stability of the organisation. One of the outcomes of poor corporate governance is financial crisis in the organisation. Example Infosys has been a pioneer in benchmarking its corporate governance practices and considered as the best in the world. The following are the features of a company which has good corporate governance:

A culture based on the foundation of a sound business ethics and business values Satisfying the long-term strategic goal of the owners while considering the expectations of all key stakeholders in the following ways: Considering and caring the employees interests in past, present and future Maintaining excellent relationship with both customers and suppliers Considering the needs of the environment and the local community

Maintaining proper fulfillment in terms of legal and regulatory requirements under which the company is carrying out its activities. Q4. What is Corporate Social Responsibility(CSR) ? Which are the issues involved in analysis of CSR? Name three companies with high CSR rating. Corporate Social Responsibility (CSR) is the continuing obligation of a business to behave ethically and contribute to the economic development of the organisation. It improves the quality of life of the organisation. The meaning of CSR has two folds. On one hand, it exhibits the ethical behaviour that an organisation exhibit towards its internal and external stakeholders. And on the other hand, it denotes the responsibility of an organisation towards the environment and society in which it operates. Thus CSR makes a significant contribution towards sustainability and competitiveness of the organisation. CSR is effective in number of areas such as human rights, safety at work, consumer protection, climate protection, caring for the environment, sustainable management of natural resources, and such other issues. CSR also provides health and safety measures, preserves employee rights and discourages discrimination at workplace. CSR activities include commitment to product quality, fair pricing policies, providing correct information to the consumers, resorting to legal assistance in case of unresolved business problems, so on. Example TATA implemented social welfare provisions for its employees since 1945. Roles played in terms of ethical conduct CSR plays a significant role in maintaining ethical conduct in an organisation. The following are the roles played by CSR: Improves the relationships with the investment community and develops better access to capital and risks Enhances ability to recruit, develop and retain staff Improves the reputation and branding of the organisation Improves innovation, competitiveness and market positioning Improves the ability to attract and build effective and efficient supply chain relationships Improves relationships with regulators 4

Features of CSR CSR improves the customer satisfaction through its products and services. It also assists in environmental protection and contributes towards social activities. The following are the features of CSR: Improves the quality of an organisation in terms of economic, legal and ethical factors CSR improves the economic features of an organisation by earning profits for the owners. It also improves the legal and ethical features by fulfilling the law and implementing ethical standards. Builds an improved management system CSR improves the management system by providing products which meets the essential customer needs. It develops relevant regulations through the utilisation of innovative technologies in the organisation Contributes to countries by improving the quality of management CSR contributes high quality product, environment conservation and occupational health safety to various regions and countries. Enhances information security systems and implementing effective security measures CSR enhances the information security measures by establishing improved information security system and distributing them to overseas business sites. The information system has improved by enhancing better responses to complex security accidents.

Q5. Distinguish between core competence, distinctive competence, strategic competence and threshold competence. Use examples. A core competency is a concept in management theory originally advocated by C. K. Prahalad, and Gary Hamel, two business book writers. In their view a core competency is a specific factor that a business sees as being central to the way it, or its employees, works. It fulfills three key criteria: 1. It is not easy for competitors to imitate. 2. It can be re-used widely for many products and markets. 3. It must contribute to the end consumer's experienced benefits. The importance of the product/service to its customers. A core competency can take various forms, including technical/subject matter know-how, a reliable process and/or close relationships with customers and suppliers.[1] It may also include product development or culture, such as employee dedication, best Human Resource Management (HRM), good market coverage etc. A distinctive competency is a competency unique to a business organization, a competency superior in some aspect than the competencies of other organizations, which enables the production of a unique value proposition in the function of the business. A distinctive 5

competency is the basis for the development of an unassailable competitive advantage. The uniqueness differentiates this competency from all others, whether a core competency or simply a competency. The characteristics required by a jobholder to perform a job effectively are called threshold competencies. These distiguish the people who can do the job from those who cannot. For the position of a typist it is necessary to have primary knowledge about typing, which is a threshold competency. threshold competency is summarized as a quality that a person needs in order to do a job; it might be as simple as being able to speak in the native language. It is different from the competency in a manner that it does not offer any aid in distinguishing superior performance from average and poor performance. So, every job at any level in the organization would have a threshold competency, the bare minimum required to perform the job.

Q6. What is global industry? Explain with examples, international strategy, multidomestic strategy, global strategy and transnational strategy. global industry The Global Industry Classification Standard (GICS) is an industry taxonomy developed by MSCI and Standard & Poor's (S&P) for use by the global financial community. The GICS structure consists of 10 sectors, 24 industry groups, 68 industries and 154 sub-industries into which S&P has categorized all major public companies. The system is similar to ICB (Industry Classification Benchmark), a classification structure maintained by Dow Jones Indexes and FTSE Group. GICS is used as a basis for S&P and MSCI financial market indexes in which each company is assigned to a sub-industry, and to a corresponding industry, industry group and sector, according to the definition of its principal business activity. Multinational Strategy Under this, a firm's subsidiaries in the foreign countries enjoy strong local autonomy of business decision-making. Global strategy Global strategy as defined in business terms is an organization's strategic guide to globalization. A sound global strategy should address these questions: what must be (versus what is) the extent of market presence in the world's major markets? How to build the necessary global presence? What must be AND (versus what is) the optimal locations around the world for the various value chain activities? How to run global presence into global competitive advantage?

A global strategy may be appropriate in industries where firms are faced with strong pressures for cost reduction but with weak pressures for local responsiveness. Therefore, it allows these firms to sell a standardized product worldwide. However, fixed costs (capital equipment) are substantial. Nevertheless, these firms are able to take advantage of scale economies and experience curve effects, because it is able to massproduce a standard product which can be exported (providing that demand is greater than the costs involved). International Strategy The parent company deploys innovations and allocation of resources rapidly through foreign direct investment in different nations. The firm can maintain a differentiation strategy under this. Transnational Strategy Under this multinational, global and international strategies are rationally combined. It enables the firm to simultaneously achieve local flexibility while rapidly absorbing and differing parent company's innovations. Transnational strategy implies seeking global integration, operational efficiency and excellency of performance on a continuous basis. Multi domestic strategy Multi domestic strategy is a strategy by which companies try to achieve maximum local responsiveness by customizing both their product offering and marketing strategy to match different national conditions. Production, marketing and R&D activities tend to be established in each major national market where business is done. An alternate use of the term describes the organization of multi-national firms. International or multinational companies gain economies of scale through shared overhead and market similar products in multiple countries. Multi domestic companies have separate headquarters in different countries, thereby attaining more localized management but at the higher cost of forgoing the economies of scale from cost sharing and centralization.