Corporate level strategy diversification ppt - How to Be a Good Corporate Parent

The stakes involved in coming up with the right answers to these questions are high.

The wrong parenting strategy can undermine entrepreneurship in the business units and severely degrade their value-creation potential. By contrast, an effective parenting strategy can create a situation in which 100forexbrokers whole really is bigger than the sum of the parts and can deliver a valuation premium for a multibusiness company.

To identify successful parenting strategies of multibusiness corporate level strategy diversification ppt, Opt has been studying the value-adding and value-destroying activities of such companies worldwide.

The centerpiece of this research is a survey on the sources of corporate value creation that we sent out to CEOs, CFOs, and functional heads at approximately of the largest public and privately owned diversified companies. Executives at about of these diverwification completed our survey, a response rate of about 17 percent.

BCG uses cookies to improve the functionality, performance, and effectiveness of our communications. Assumption underlying a vertical integration strategy: Control over inputs or distribution channels increases opportunities for cost savings or value creation.

Protection of or control over valuable assets, proprietary technology Access to new business opportunities Simplified procurement and administrative procedures Greater control over costs of components Reduction in transactions cost Ability to maintain or cultivate a reputation for outstanding corporate level strategy diversification ppt or service. Costs and expenses associated with increased overhead and capital expenditures Loss of flexibility from large investments Corporatf associated with unbalanced capacities along the industry value chain.

Low demand can lead to underutilization of capacity High demand can result in a dependence on outside suppliers Higher administrative costs associated with managing a more complex set of activities.

Selling off business units as a whole Spin-off: Business Unit gains financial and managerial independence parent company stock options math retain some ownership Liquidation: When then company attempts to reduce the overall scope of its corporate level strategy diversification ppt Portfolio Restructuring: Changing the mix of industries that are represented in the corporate portfolio.

Financial considerations Growth considerations. Have a strong competitive position in rapidly growing industries Are major contributors to corporate revenue Offer excellent profit potential What about the cash? What about the cash?

Corporate-level Strategy Diversification (Related and Unrelated)

They can be milked for cash to: Pay corporate dividends Finance new acquisitions Invest in young stars and question marks Moo!! How are strategies formulated. Evaluating the Strategies of Diversified Corpoorate Crafting and implementing action plans to improve the overall attractiveness and competitive strength.

In emerging markets, we focused primarily on increasing volume, keeping our beverages affordable and strengthening the foundation of our future success. In developing markets, we struck a balance between volume and pricing.

Creating value for our Company and customers looks different in different countries, and we did a good job segmenting our markets to drive revenue growth in While corporate level strategy diversification ppt still have corporage to do, we were encouraged by our results.

We also gained worldwide value share in our industry. Healthy businesses require continuous investment.

We made a choice to invest in more and better marketing for our brands, increasing both the quantity and quality of our advertising. At the same time, we invested across our expansive beverage portfolio.

Description:Presentation of the strategic evolution method. AEL: South African base explosives company, fully owned subsidiary of AECI limited . Furthermore, Porter explained that the level of profitability of an industry is determined by . product diversification; Miller goes further by linking company structure to the well-known.

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