Strategy options

Presented By-:
Shradha Agarwal
Parthavi Upadhaya



Strategy
"Strategy is the direction and scope of
an organisation over the long-term:
which achieves advantage for the
organisation through its configuration of
resources within a challenging
environment, to meet the needs of
markets and to fulfill
stakeholder expectations".
Growth options-:
Merger
Acquistion
Stability
Merger
Merger: Occurs when two companies,
usually of similar size, combine their
resources to form a new company.



Types of merger
Vertical
Horizontal
Conglomerate
Vertical
1)Vertical Mergers: The consolidation of
firms that produce different goods or
services for one specific finished product.
Horizontal
2)Horizontal mergers: The consolidation of
firms that are direct rivals--i.e. firms that
sell substitutable products or services
within the same geographic market.
.

Conglomerate
3)Conglomerate Mergers: Consolidated
firms may share marketing and distribution
channels and perhaps production
processes; or they may be wholly
unrelated.

Acquisition
Acquisition: Occurs when a larger
company buys a smaller one and
incorporates the acquired companys
operations into its own.

Stability
With this strategy an organization
continues to serve its same market and
customers while maintaining its market
share. It is most appropriate when several
conditions exist-:
a stable and unchanging environment,
satisfactory organizational performance,
a presence of valuable strengths.
.anesses,
Growth n Expansion
Penetration
In this the firm aims to sell more of its existing
products in the markets that they are already in.
This would translate into allocating more
resources and efforts to build up sales and
marketing activities to attain revenue growth.
Indirectly, the firm is also trying to increase its
market share. Generally, this may seem less
risky to a certain extent because the firm is
already dealing in the same market and products


Market Development
In this strategy existing products/new
markets, this happens when a firm decides to
sell its existing products into new geographical
markets or new market segments (another
defined target market). For example, it could
mean selling an existing computer model to a
new market overseas or alternatively, selling it
to a new market segment (e.g. second-hand
market
Product development
This is a quite common process because for a
company to sustain its presence and growth, it
cannot rely on a single product range. For
instance, in the retail industry of product
consumables like shampoo, cosmetics
companies are competitively refreshing their
product lines to keep in touch with consumers as
well as to keep up with certain trends, market
needs/tastes and etc.
Diversification
Diversification is where the firm sells
entirely new products to new customers in
new markets. The reasons for such a
business strategy could be due to a rise in
opportunity that the firm has identified, or
feel the need to tap and rely on new
sources of growth and so on.

Types of Diversification
Related
Unrelated
Related
Related diversification means that the firm
remains in a particular industry, but
diversify into another type of product to be
sold to new markets. For example, a
chocolate manufacturer diversifies into a
manufacturing of the bread/pastry .


Unrelated
Unrelated diversification refers to a
situation where the firm completely
ventures into a new business area to serve
new markets with its new product
development.

Retrenchment
A strategy used by corporations to reduce
the diversity or the overall size of the
operations of the company. This strategy
is often used in order to cut expenses with
the goal of becoming a more financial
stable business.
Combination strategy
It is not an independent classification but it
is a combination of different strategies
stability ,growth in various forms. This is
usually followed by organisations having
different business portfolios with each
business facing different problems.
Why to pursue combination strategy?
1) Different products in different product
life cycle.

2) Business Cycle.

3) Number of Businesses.