(Initial) assignment feedback<\/p>\n
Make sure you follow\/understand the instructions<\/p>\n
VRIO is used for internal analysis<\/p>\n
PESTLE is used for macro analysis<\/p>\n
The report should be focused on the industry structure and competitors. <\/p>\n
Be specific when you provide information<\/p>\n
What does large, increasing, growing, etc. mean? Provide the details if possible. If you already provide them in the appendix, restate them in the repot <\/p>\n
The report is not just a shortened version of the appendix.<\/p>\n
Highlight the most important factors and discuss them in sufficient depth. <\/p>\n
It is not about death by information, be selective about what you include, also in the appendix. <\/p>\n
Today\u2019s learning objectives<\/p>\n
Define corporate level-strategy<\/p>\n
Understand diversification and its different levels<\/p>\n
Explain when reasons firms diversify<\/p>\n
Understand the risks and benefits of diversification<\/p>\n
Corporate level strategy<\/p>\n
\u2022 Only firms with multiple businesses need a corporate strategy<\/p>\n
Scope decisions Corporate parenting SBU decisions<\/p>\n
Which combination of businesses What does the corporate parent How to play at the SBU level? do? <\/p>\n
How does the \u2018parent\u2019 add value?<\/p>\n
Corporate strategy<\/p>\n
Market\/Product development<\/p>\n
Product line depth and width decisions<\/p>\n
Integration<\/p>\n
Vertical: Extending the business long the value chain<\/p>\n
Horizontal: Extending on the same level in the value chain<\/p>\n
Diversification<\/p>\n
Diversification and vertical integration<\/p>\n
Engaging in multiple businesses (markets & industries)<\/p>\n
Portfolio of businesses<\/p>\n
Using resources across businesses (i.e., excess resources)<\/p>\n
Vertical integration (backwards and forward)<\/p>\n
Moving up or down the value chain<\/p>\n
Remember the IKEA example?<\/p>\n
Inter IKEA <\/p>\n
Holding BV<\/p>\n
Inter IKEA <\/p>\n
Systems BV <\/p>\n
Franchise<\/p>\n
IKEA of <\/p>\n
Sweden AB <\/p>\n
Product offering & <\/p>\n
Development<\/p>\n
IKEA Supply <\/p>\n
AG <\/p>\n
Source and distribution<\/p>\n
IKEA <\/p>\n
Industry AB<\/p>\n
Manufacture<\/p>\n
Inter IKEA <\/p>\n
Holding BV<\/p>\n
Inter IKEA <\/p>\n
Systems BV <\/p>\n
Franchise<\/p>\n
IKEA of <\/p>\n
Sweden AB <\/p>\n
Product offering & <\/p>\n
Development<\/p>\n
IKEA Supply <\/p>\n
AG <\/p>\n
Source and distribution<\/p>\n
IKEA <\/p>\n
Industry AB<\/p>\n
Manufacture<\/p>\n
Levels of diversification<\/p>\n
Low levels<\/p>\n
Most revenue comes from a single or a few businesses<\/p>\n
Moderate levels<\/p>\n
Revenues are more equally balanced across a few businesses<\/p>\n
High levels<\/p>\n
Revenues are balanced across many businesses<\/p>\n
Types of diversification<\/p>\n
Constrained<\/p>\n
Strong sharing of \u2018operational\u2019 resources (e.g. technology, distribution)<\/p>\n
Related <\/p>\n
Sharing of \u2018operational\u2019 resources (e.g. technology, distribution)<\/p>\n
Related linked<\/p>\n
Some sharing of \u2018operational\u2019 resources (e.g. technology, distribution), sharing of \u2018other\u2019 resources<\/p>\n
Unrelated <\/p>\n
Sharing of \u2018other\u2019 resources (non-operational)<\/p>\n
Value creation in diversification<\/p>\n
Related diversification<\/p>\n
Economies of scope & synergies (sharing of tangible resources)<\/p>\n
Transfer of competencies (sharing of intangible resources)<\/p>\n
Market power<\/p>\n
Unrelated diversification<\/p>\n
Financial economies (e.g. taxation, reduced revenue fluctuation)<\/p>\n
Internal capital market (e.g. reduction in information asymmetries) \u2022 Bridge institutional voids <\/p>\n
Value destruction in diversification<\/p>\n
Managerial self-interest<\/p>\n
Related diversification<\/p>\n
Coordination and bureaucracy <\/p>\n
Dependencies<\/p>\n
Unrelated diversification<\/p>\n
Financial mismanagement<\/p>\n
Inefficient internal capital market<\/p>\n
Next week<\/p>\n
Acquisitions and restructuring<\/p>\n
Required reading: Chapter 7<\/p>\n
Required reading: Divestiture: Strategy\u2019s missing link<\/p>\n
Don\u2019t forget your preparation (poste on comment). <\/p>\n
Thank you<\/p>\n
Thank you<\/p>\n
13<\/p>\n
13<\/p>\n
13<\/p>\n
2<\/p>\n
2<\/p>\n
2<\/p>\n
2<\/p>\n","protected":false},"excerpt":{"rendered":"
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