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Strategy. Corporate-level: A plan to use and develop core competencies so that the organization can not only protect and enlarge its existing domain but can also expand into new domains The responsibility of corporate-level managers and the heads of divisions. Strategy.
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Strategy Corporate-level: A plan to use and develop core competencies so that the organization can not only protect and enlarge its existing domain but can also expand into new domains The responsibility of corporate-level managers and the heads of divisions
Strategy Business-level: A plan to combine functional core competencies in order to position the organization so that it has a competitive advantage in its domain The responsibility of the top-management team (the CEO and vice presidents)
Strategy Functional-level: A plan of action to strengthen an organization’s functional and organizational resources, as well as its coordination abilities, in order to create core competencies The responsibility of functional managers
Calvin & Hobbes • Know what your competition is doing, and adjust your strategy accordingly.
SWOT Analysis External Environment Threats Opportunities Internal Environment Weaknesses Strengths Organization’s Mission Corporate Goals Operative Goals
A Few Good Men • Do the structure and culture of the U.S. Marine Corps fit its current environment? • What about the “code”: unit, corps, God, country? • Does the goal of flawless cooperation justify the use of harsh discipline?
Paradigm Entertainment • How has environment affected Paradigm’s strategy and external ties? • How have resource dependence and concern about transaction costs affected Paradigm’s strategy? • How have the environment and strategy at Paradigm influenced the organization’s internal structure and culture?
Structure, Culture, and Environment A Few Good Men versus Paradigm • Why is a flat, decentralized structure and loose, freewheeling culture appropriate for Paradigm? • Is there any group within U.S. military organizations that would benefit from an organic structure and playful culture like Paradigm’s? How? Why?
Typical Corporate Strategy An organization that cannot create more value in its current domain often tries to find a new domain in which to compete. Diversification—producing new products for new markets—is one avenue for expansion.
Typical Business-level Strategy • Strategy at this level should: • Select the domain of the organization • Use resources and abilities to manage • its environment to protect and • enlarge that domain
Matrix Product, market, Product team Functional structure or geographic structure structure structure Dif fer entiation Strategy Low-Cost Strategy Complex structure Simple structure Decentralized decision making Centralized decision making High differentiation Low differentiation High integration Low integration Organic structure Mechanistic structure Characteristics of Organizational Structure Associated with Business-Level Differentiation and Low-Cost Strategies
Typical Functional-level Strategy • To lead to competitive advantage, • an organization should: • Perform functional activities at a cost • lower than that of its rivals • OR • Perform functional activities in a way • that clearly differentiates its product • from those of its rivals