BBPS4103 Strategic Management | Assignment
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Strategic Management (BBPS4103)
Added on 2020-03-16
BBPS4103 Strategic Management | Assignment
Strategic Management (BBPS4103)
Added on 2020-03-16
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BBPS4103 STRATEGIC MANAGEMENTASSIGNMENT 1INSTITUTIONAL AFFILIATION(S)STUDENT NAME[Pick the date]
STRATEGIC MANAGEMENTAssignment 1(a)CORPORATE LEVEL STRATEGIESIn changing environment of businesses, the scope and direction through which organisation configures its competence and resources to meet stakeholder’s expectation is called strategies[ CITATION Tol16 \l 1033 ]. Basic characteristics of strategy are that they are long term in temperament i.e. planning can be short timed but its affect has long term impression on organisations. Elements of uncertainty along with dynamic constituent are contained in strategies while directing organisations towards meeting goals of company. There are two basic levels of strategic formulations, corporate level strategy and business level strategy. In this assessment corporate level strategies will be described while identifying the same in three renowned organisations. Corporate level strategy is considered as delicate part in strategic planning proceduresand is highly responsible for affecting organisations. It involves critical analysis of company while considering probable questions arising about business to participate in. Corporate strategies can also be defined as set of plan and actions made in order to assist organisations achieving desired goals and objectives. Corporate level strategies can be further divided into four parts; Integration strategies, Intensive strategies, Diversification strategies and Defensivestrategies. Integration strategies, also known and vertical integration strategy deals in involving horizontal, forward or backward controlling of operations in organisations. Intensive strategies are used to gain competitive advantage in business by making intense decisions and efforts on corporate level. Diversification strategies refers to such activities in which organisations involves its businesses in diversified areas and to those places which may or may not relate to centre commotion of organisation. Defensive strategies refer to those activities that are utilised by organisations to defend it from declining its position. While corporate strategies are determined, the managers need to take strategic decisions to increase and maintain overall activity of business and thus it becomes significant for corporate managers to select the decision according to the requirements in obtaining core objectives of organisation. 2 | P a g e
STRATEGIC MANAGEMENTPEPSICOPepsiCo is the second largest company in the world dealing in food and beverage. The headquarters of the company is situated in New York in USA. The company was established in the year 1965 with merger of Frito Lay and Pepsi-Cola Company. The mission and vision statement are aligned with the current operations of the business. The diversification strategy company follows, is highlighted in terms of market and product mix while leading the company to develop products and fulfil the demand of customers. PepsiCo’s corporate mission declaration establishes actions that help in achieving vision of the company. It also indicates organisation the direction for attaining long term sustainability and pushing the company towards the top in global food market. The firm’s generic strategy is made according to market pressure coming from its competitors and in order to maintain competitive advantage, PepsiCo uses corporate strategies to evolve in food and beverage market worldwide [ CITATION Pep14 \l 1033 ]. Intensive strategies used by PepsiCo makes the company penetrate in markets with primary growth intensive strategy. The intensive strategy allows increase in sales through sharing big portion of market globally. With forceful marketing strategy it follows, PepsiCo has been successful in attracting large amount of customers. The main reason behind company’s intensive growth strategy is to reduce expenditure in order to attract more people in spite of saturation in market. The cost leadership quality also supports generic competition while supporting integrative strategies. The second corporate level strategy implemented by PepsiCo is product development. This intensive strategy helps company promote newer products and develops existing products to capture more consumers. Board differentiation and generic competitive strategies followed by PepsiCo offers uniqueness and novelty in products and growth in business. Market development is also supported by intensive growth strategy of PepsiCo as it supports entering new market segments and continues in expanding business through distribution network in developing regions. Although PepsiCo has got significant market presence, still the strategic objectives of business supports intensive growth strategies by expanding in more diversified areas [ CITATION Edw172 \l 1033 ]. Over the years PepsiCo has been utilising its integrative strategies in corporate levels to formulate systematic strategies required for growth of the company. Forward integration system is majorly utilised by PepsiCo under which functions relating supply chain takes shape. Distributors, manufacturers and retailers are controlled by the company before making3 | P a g e
STRATEGIC MANAGEMENTfinal transact of finished products [ CITATION Joh161 \l 1033 ]. The distribution and bottling rights have been undertaken by Pepsi America and Pepsi bottling group. In terms of profiteering, these strategies have been a huge success and according to annual report presented by company most of its beverages like Gatorade, Pepsi, Tropicana, etc. have increased its profit for more than 1% annually. Horizontal growth strategies of PepsiCo has enabled company expand its existing products in more diversified regions or market segments. The company has made many strategic alliances which has made easier for the company to increase its economic scale by increasing its operations. Earlier PepsiCo has started its business from American regions but now it operates in more than 200 countries including Asia and MENA regions. PepsiCo follows concentric diversification strategy that means the company expands its business in related industry only and adopts synergies that align existing business[ CITATION Pep12 \l 1033 ]. Situation that are chosen for new business gains advantages from common similarities of existing business in forms of technology, distribution, product, manufacturing or customer aspects. Therefore this strategy helps in avoiding controversial reasons for carbonated drinks as PepsiCo poses for healthier variety in food products. PepsiCo has also made many acquisitions and mergers in order to create more efficient and agile brand while enabling innovative and competent brand in beverage and food system. Presently the CEO of the company, Indra Krishnamurthy Nooyi has been increasing PepsiCo’s associations with other recognised brands and increasing company value by promoting the initiative of ‘One PepsiCo’ to facilitate sharing infrastructure and supply chain management. PepsiCo has undoubtedly risen strikingly from defensive to offensive stage by makingdecisions strategically in corporate level [ CITATION Acc15 \l 1033 ]. Company’s has been successful in understanding its consumers and monitored trends by regular accessing day to day business operations. The company had been able to protect the core objective by evaluating consumer’s categories and measuring the market and its competitors. Cost cutting strategies followed by PepsiCo has made the company save its synergies for product development while enabling technology and innovations in its industrial sites. The corporate strategy of the company also enables CSR in its functions thereby satisfying governmental requirements and business ethics.4 | P a g e
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