Managers participate in three stages of strategic planning for their organisations. They use a variety of strategies to attain their goals:
1. Corporate-level Strategy
A firm's corporate-level strategy defines the portfolio of businesses that make up the corporation, as well as the relationships between them. These strategies focus around the decision of whether to keep or change the current commercial enterprise or increase the efficiency and effectiveness with which the company achieves its corporate goals.
There are four sorts of business level strategy: stability plans, which include maintaining the status quo, long-term growth, and so on. Growth strategy, concentration methods, mergers, takeovers, acquisition, horizontal integration, conglomerate diversification, vertical integration, and partnerships are all examples of growth strategies. Turnaround, captive business transformation, divestment, and liquidation are all retrenchment tactics. Finally, portfolio restructuring is included in combination strategies.
2. Competitive Strategy at the Business Level
This strategy describes how the company's managers will establish and strengthen the company's long-term competitive position in the marketplace. It's also known as strategic business unit (SBU) level plans, in which organisational operations are separated into strategic subsystems, each of which has its own set of products or services, competitors, and purpose. Each subsystem's strategy is developed in accordance with the corporate strategy.
Differentiation strategy, market segmentation, and distinguishing competency are used to develop generic strategies at the SBU level. Low-cost leadership, differentiation, and focus are the generic strategies.
3. Competitive Advantage
This supports the company's competitive strategy and distinguishes it from its competitors.
4. Functional Strategy
Determine the basic courses of action which each department will take in order to assist the company in achieving its competitive objectives. These functional strategies must be consistent with the company's competitive strategy. Separate departments, such as production, may use flexible manufacturing, lean production, and six sigma; marketing may focus on client focus and personalization; and so on. HRM may concentrate on developing skills, making hiring decisions based on attitude and emotion, paying for performance, forming self-managing teams, and offshoring. Materials management entails just-in-time delivery, complete quality management, and supplier rationalisation; R&D entails new goods, new processes, and so on.