INTGRTVE STRATGIC DECSN MKNG. Business & Marketing Book Review

Chapter 1
Every corporation and business entity have separate departments that play various roles contributing to the success of the Company. Amiss a compelling and brilliant corporate strategy, there is a danger of incurring a loss and acquiring liabilities that will affect not only the company's ratings but also its performance. According to Puranam and Vanneste that business strategies are created and different depending as to whether an individual created a multiple businesses firm or a single business enterprise. There are distinctions between the two and a few of the things to consider are the (1) number of business, (2) vision and mission, (3) level of competition and the (4) concepts in terms of analysis and assessment.
The authors gave a specific example such as the type of business, which involves multiple joint ventures. Chapter 1 herein gives the readers a specific and detailed process of firstly identifying what kind of business has been opened and created. Is it single or multi? The rationale behind this argument is because the strategies are never the same and the approach ought to be one that is entirely compatible with the class and type of business being operated. The ability to decipher and identify what kind of business is being handled will make it a whole lot easier to choose the best strategy that will surely produce results. One such example is the case wherein the company has separate and multiple businesses such as for electronics, for software production, mining instruments, the creation of jet engines and beauty products.
Having multiple, different and a variety of businesses entail specific strategies that will work for each, no one strategy is the same because the products are different and the kind of consumers being catered to, also have different preferences. To make the above important points more clear, the type of corporate strategy applied in multi-business enterprises will eventually lead to the acquisition of corporate advantage. This means that the business owner has the possibility of a higher rate of percentage of success in all its endeavors and business deals. Furthermore, synergies are also assessed in chapter one of this book, Synergies have been defined as the benefits acquired via collaboration. Author Vanneste is indicating that there will be a higher rate of synergies for every successful procedural collaboration developed between two businesses. This increases the significant profits to be earned.
It is deciphered that although Corporate Advantage has been explained clearly and what it focuses on, in truth, a real-life practice of the same is complicated to measure. Hence, it has become a fact that it will be better if it is considered as a goal instead of a form of measure. It is a useful guide for strategists in accomplishing milestones in the world of business and in creating strategies for decision-making procedures. To make it more specific, writer Vanneste explained that the utmost goal of a corporate strategy is to build synergies, the pursuit of corporate advantage and to ensure that your assets are not more valuable to another buyer.
An investor who has a portfolio of corporate strategies is said to be at a more advantageous position and is capable of acquiring synergies that will help modify the cash flow of expenses and profit earning capacity of the business. As stated earlier, the goal is to develop a corporate advantage that could be used for the benefit of the company. Owning a business and enterprise is not a game of chance and could only be put into completion if the management has a brilliant strategy that is proven to be accurate and advantageous to the corporation.
Nevertheless, the book does not put any limits as to the number of strategies that could be applied to get synergies and holds no conditions in establishing the most powerful procedures that will bring profit and earnings to the company. It is not easy for starting companies to immediately earn and bring forth millions of dollars at the snap of the finger but it requires a series of feasibility studies and extensive research that will help in the collation of the most authentic, legitimate and valid procedural strategy that will surely give the corporation the win that it has been looking for. Puranam elucidated that business strategy focuses greatly on the business model for purposes of generating an advantage as opposed all other competitor businesses on account of selling goods and services to prospective clients.
Whilst, in my opinion and based on the facts of this book, I think that corporate strategy refers to a group of businesses enforcing a specific method of strategy that will prove operative and practical to the needs of the businesses involved, though it is a fact that a corporation might undergo the risk of losing profitability when it comes to multiple businesses. Meaning, it might earn less in one business but compensate for the loss in terms and through all the remaining businesses. The trend nowadays is to engage in not only one business enterprise but several business ventures. It could be one micro and one macro business.
Chapter 2
I have reviewed in Chapter 1 that the ultimate goal of the company strategist is to obtain a corporate advantage by collaborating with other similar businesses under the same or different owner, joining the portfolios on strategies and methods of marketing and building the venture. According to Puranam that corporate advantage could only be accomplished through synergies which evidences a systematic approach. A higher percentage of corporate advantage is met only via a systematic approach. The greater the synergies, the more successful a business could turn out in terms of profit making and in selling the products and services.
I think these methods are not limited to only one strategical option but it could be broadened into other procedural marketing stunts that could increase the chance of obtaining synergies that will contribute greatly to the business process. The portfolio must clearly identify the various corporate strategies that are definite to give the company an advantage against all other competitors in the market. In this Chapter 2, the focus is on synergies and how to distinguish each as it leads to different organizational implications. In layman's terms, synergies are defined and explained to further understand its importance in the field of business and marketing.
This is a book review on the different chapters and parts of the book Corporate Strategy Tools for Analysis and Decision-Making to elucidate on the importance of the different strategy tools for corporate business and marketing in the process of analysis and decision-making. There is a need for readers and researchers to fully understand the concept of creating and maintaining a business that will further help in the development of a particular enterprise. The focus of this paper is to be familiar with what is most necessary for a business project to become successful. Having that deeper grasp of the mechanics in growing a business or entrepreneurial project will help the business person to be wary and aware of the things which must be avoided that could probably lead to failure of the business venture.
There is no easy way of accomplishing complicated business issues and dilemma than by becoming prepared, armed with the required knowledge that could help us survive. The twelve (12) chapters of this book will be accurately and thoroughly deciphered to help us come up with the latest important strategical techniques based on the type and class of facts that are relayed in such book. This book is divided into different parts starting from the very foundations of corporate advantage and how it relates to the core meaning of competitive edge. Likewise, the definition of synergies and what it comprises are also narrated in the next subsections of this book review with the utmost goal of analyzing the very purpose of the authors of this book.
Basically, the whole book is focused on corporate strategy and how it affects one's mindset depending on the results of whether or not each strategy are effective enough for entrepreneurs to earn and double their profits. At the end of this book review, a conclusion is provided to decipher and provide a summary, the very gist and focal point of this review. It is a fact that multi-corporations started out as a single-business conduit and expanded its franchise because the strategies used were effective enough to allow the company to earn more leading to the development of additional companies. Thus, corporate strategies, although it is more efficient for numerous businesses, there are no prohibitions that it could be used in single businesses.
This has been a strategical practice by some business people to ensure that in case incurring liabilities and losses in one business, there will be another to make up for such loss. This is a brilliant strategy but the owners must not remain stagnant and must keep up with the latest updates in the market. Some businesses have closed down due to bankruptcy because it failed to upgrade its methods regularly and have become lost in the new trends in the market. Marketing is a continuous process which must get better over time. Moreso, the corporate advantage only takes place whenever joint ownership of various business ventures are of higher importance and value rather than similar types of businesses owned in a separate status. This book also gives the importance of creating a portfolio of strategies collated to experiment and assess what processes and methods are best effective if used properly and consistently.
This book Corporate Strategy Tools for Analysis and Decision-Making explained that corporate strategy is not only for multi-faceted businesses but as well as for single-based companies. It is also wise to elaborate on the various factors that could affect a specific strategy for a particular period of time and when it is time to modify the tactics and maneuver it in such a way that it will give the enterprise an advantageous position and leverage higher than other competitors.
Chapter 3
To summarize, Chapter 3 discusses Governance Costs which refers to operation expenditures if there is a joint operation of two or more businesses. There are impediments which ought to be resolved and in the process, costs are generated. Governance Costs are actually negatively defined since these are challenges that hinder the businesses to move smoothly in order to produce synergies. To clarify, there is a difference between the business strategy from the corporate strategy. All these strategies lead to acquiring corporate advantage which is direly needed in the mechanical and technical processes of gaining the trust of clients, marketing and advertising the products alongside the presentation that will attract hundreds and even thousands of buyers that will believe in your items and how these could be used advantageously for their own benefit.
I think that every business must have a separate portfolio that prepares them for this type of dilemma which must be immediately solved since Governance costs together with synergies are considered as very important factors in corporate strategy. It must be remembered that the process of exploiting a potential synergy involves choosing a governance structure that opens opportunities to the highest net value of the costs of governance. In accordance with synergies and how it helps to develop a novel method in analyzing the value chain segments of different businesses, Governance costs also play a major role in introducing a heuristic framework which helps in the assessment process of the conditions over which the businesses will be affected by the costs and result to impediments.
Governance costs and synergies are intertwined that any issues in one could have a domino effect with the other. Thus, to produce an optimal governance system, the business CEO’s and management team must diligently take into account the benefits and the consequences of collaboration. It must be a priority to always think of what works for the company and what brings about success. There is no easy and fast rule in the administration of a single corporation, more of a chain of businesses. Diligence, consistency, integrity and ingenuity must all be applied to succeed. This chapter lies at the very center of corporate strategy decisions and must not be set aside. Opening a business or corporation is not as easy as it looks like and there must be brainstorming and teamwork to reach that pinnacle of success.
Governance costs include ownership costs and transaction costs. A corporation hires people and staff who will work for the company hence there is a need for incentives and motivation. People need to be motivated and encouraged. In the area of collaboration, it is a fact that business owners care more about what's perfect for their own businesses rather than of the others. Thus, failure in cooperation will not lead to a shared future such as two alliance partners who are in the process of building a joint project will fail to continue if there is the absence of cooperation. It has been a practice since time immemorial to produce and distribute incentives that rewards employees for all their hard work and excellent performances. Their contribution to the company matters. If the employees and officers are performing well then it lessens governance costs on the possibilities of impediments and liabilities. However, the company has to invest in the rewards and bonuses for the staff and workers which eventually will later on be paid through the success and profits earned by the company.
Moreover, examples of governance costs that affect the company in a positive manner to encourage cooperation are business contracts, the process of monitoring suppliers, solving disputes in prices, choosing what products are quality and excellent in nature, and the enforcement of contracts by Court procedure. For as long as the Company is benefitted, even if it is termed as governance costs, cooperation will be developed and help increase the company’s sales. On the other hand, cheating, misrepresentation, fraudulent transactions are all direct cost of cooperation, a possible failure in terms of coordination. Two things must be achieved in Governance Costs and that is cooperation and coordination.
On another note, coordination refers to the unity in actions so that the management team of the company will determine which works perfectly for and on behalf of the company. This is not a perfect process since solvers and strategists are also human beings prone to mistakes and failures. They might fail in the areas of gathering wrong information, or mistakenly process wrong complex information. It is a harrowing fact that even if people are united to work together, mistakes, delays and misunderstandings will still arise even if the team are highly motivated to work together. In this case, the possible factors that might lead to failed coordination ought to be reviewed, assessed and avoided. Mostly, examples of these factors are the geographical locations or time zones of the various areas or departments of a particular company, differences in the professions or absence of shared past.
Chapter 4
This chapter revolves around the definition of Diversification and how it could relate to the business deals of a company. Corporations are regularly pressured to make the right decisions and work on projects that are sure to be successful. This is the very reason why business owners must have knowledge of strategic decision-making methods in resolving any type of dilemma that could arise at work. This chapter provides us with a specific framework that provides a strategy in analyzing corporate diversification decisions.
For example, what must be done in case an existing firm wants to try out a new business which actually started from the previous one? How could the company management make it work? This is where diversification steps in to guide the owner and staff on how to make success possible. Whenever two businesses or enterprises collaborate, both of the entities are still legally independent as such however, due diligence is still required to avoid mistakes that could lead to liabilities. In business transactions, the necessity for due diligence exists in mergers and alliance methodologies evidencing joint ventures. There are numerous possible mistakes that could be made in arranging an alliance but the greatest problem is the error of choosing the wrong partner. Nevertheless, the new business might cause more harm than good if it is not able to contribute to the growth and increase of sales of both of the companies, the first and the latest.
In my opinion, assessments must be continuous and imperative so that there will be an increase in the growth of profitability in the regular business practice. Creating a business also means that capabilities and resources are to be managed wisely to protect the value chain. The utmost goal is to find what is best for the whole company concerning every area of its departmental functions, increase clients, improve the quality of items and products while earning a greater amount of profit. There will be seasons where the business will not earn that much and years with prosperous earnings. In these cases, the company is required to make wise decisions on how to handle years of non-profitability and years of loss. This is why diversification gives a fresh new outlook to the company. It is a collaboration between and amongst two different businesses to gain more clientele and introduce fresh new ideas and products on the market. Accurate research must be made so that the alliance and collaboration will not fail, every nook and cranny must be reviewed to avoid pitfalls. Assessments as to what methods will bring in more sales and customers must be noted down and focused upon. The sacrifice of elaborating on the portfolio and raising the standard of service will enable the company to make up for possible loss and liabilities during seasons of slow work and business deals.
The Business management officers of the company must work on the growth tree where all the basic factors that help company expansion are captured and emphasized. The first branch focuses on either the external or internal development, also termed as organic or inorganic growth. The truth of the matter that organic growth refers to the procedure where the company creates a new business inclusive of hiring staff, making new projects while at the same time repurposing an already created business unit. The goal of organic growth is to build resources and skills that contribute to the value chain in the absence of resources from other firms.
On the other hand, inorganic growth educates us with three categories: equity and none-equity alliances, mergers and acquisitions. The alliance of firms leads to the contribution of their own resources in joint operations but they remain to have their own independent personalities and freedom. The purpose of this diversification is to have free access to each's resources and capabilities in connection with the value chain of the new business. However, the varying categories have differences in their costs and benefits which must be thoroughly assessed. It is helpful to consistently check which among the alternatives in the growing tree is best for the company's growth. There is that certain attractiveness in diversification which is also a form of a corporate strategy if used properly and wisely. The greater efficiency in terms of capital market, the higher the percentage for companies to merge or join an alliance and diversify on account of the present potential synergies between the new and old businesses.
So, the linking operations have synergies that collaborate and operate in the old and new businesses and play a major role in the justification of the diversification decisions. A company manager and business owner must be wary and intelligent enough to ponder on the amount and percentage of the entry for purposes of gaining benefits. There is also a need to pass the diversification test which captures the possible success rate when an alliance and joint business venture takes ground. In the absence of this type of assessment and reviews, the road to winning might seem impossible. This is one reason why the owner and business officers have to sacrifice and make efforts in building strong business foundations via corporate strategies. It is not easy but rewards will be reaped in the end.
Chapter 5
Basically there are other kinds of strategies that will surely provide a possible higher earnings capacity if applied by the business owner. The term coined as inorganic growth enables the ownership of cost and benefits to flourish within a partnership. The three factors of inorganic growth like non-equity alliances, equity alliances and outright acquisition must all be studied and deciphered to arrive at a positive conclusion of giving more profits for the business establishment. Not all strategies work and not all alliances are capable of turning the direction of the corporation’s success upwards. There are alliances which are not compatible and must be immediately identified before a huge liability has been acquired.
In growth technique does not only apply to the process of entering new businesses but also when it comes to exiting a business in the form of outsourcing. The latter has been the latest fad nowadays and companies which engage in such have proven how effective outsourcing could be. While non-equity alliance depends on contracts, equity ownership fills in the gaps as a form of a supplement to what's lacking in the contracts. Equity mergers and joint business ventures include one party which takes ownership as to the other business conduit and vice-versa. The relationship is very much reciprocal and could lead to shared profits and benefits.
While on account of acquisition, there is no more need for contracts. Hence, we need to view both non-equity and equity, as well as acquisitions and varying factors in a line that deliberately increases the equity ownership. This form of corporate strategy is not without any difficulties but instead serves as an eye-opener to all the possibilities which could be used to increase the positive ratings and clients acquisition of the company. Thus, the costs and benefits must be considered as to whether it is increasing the equity ownership or is the business spiraling down into the abyss and has gone overboard with this specific strategy.
The goal once again is to develop an effective corporate strategy perfectly compatible with the businesses opened. To put it more succinctly, the process of picking the choice of optimal governance system is similar to choosing the proper and perfect level of equity. This works for a trained strategist and one who has been experienced in all classes and types of business ventures. First and foremost, the newly starting out business must be in agreement with the test of diversification, otherwise, now is not yet the time to open up new enterprises and focus must be given primarily to the old business.
Hence, in my personal assessment, regular review, brainstorming and a closer checking of all these strategies will help the business to grow and earn bigger than when it first started.In my opinion, assessments must be continuous and imperative so that there will be an increase in the growth of profitability in the regular business practice. Creating a business also means that capabilities and resources are to be managed wisely to protect the value chain. The utmost goal is to find what is best for the whole company concerning every area of its departmental functions, increase clients, improve the quality of items and products while earning a greater amount of profit. There will be seasons where the business will not earn that much and years with prosperous earnings. In these cases, the company is required to make wise decisions on how to handle years of non-profitability and years of loss. This is why diversification gives a fresh new outlook to the company. It is a collaboration between and amongst two different businesses to gain more clientele and introduce fresh new ideas and products on the market. Accurate research must be made so that the alliance and collaboration will not fail, every nook and cranny must be reviewed to avoid pitfalls. Assessments as to what methods will bring in more sales and customers must be noted down and focused upon. The sacrifice of elaborating on the portfolio and raising the standard of service will enable the company to make up for possible loss and liabilities during seasons of slow work and business deals.
It must be remembered that the strategic alliances are usually not permanent because there might be conflicts of interests which might arise later on since some interests of partners might not align at all times. Moreover, alliances are proven to be quicker to start rather than acquisitions but both could be beneficial for the company just the same. In addition, since acquisitions are harder to start then there is also that possibility that the process of management might be difficult to uphold and maintain. Furthermore, the amount spent for integration in terms of the acquisition are studied to be synergy independent and dependent and managers or administrators will realize that the alliances and acquisitions are different modes of governance for having achieved the same objectives.
Chapter 6
Organic growth has been the latest strategy applied in most business entrepreneurship start-ups and it is the process of entering into a new business which includes hiring new staff and workers, the creation of the latest and new projects or programs in connection with the products and services being sold in the company, and repurposing an already growing business unit. Its utmost goal is to strengthen and grow resources as well as capabilities by possessing its very own value chain. The act of choosing between organic and inorganic actually depends on the point of contrast in terms of transaction costs and production expenditures and differences.
Both of these types of growth focus in developing the resources and capabilities required in producing a product and service to clients or in making use of the outside relationships with other firms to have open access to capabilities. Another short terminology for this process is to either build or buy. These categories are important strategies that will help the company to grow and increase in its franchises or profit-earning capabilities. It is required that the owner and managers are knowledgeable of the probable positive and negative consequences or results while using these so-called corporate strategy techniques. Accordingly, the costs of these organic differ from that of inorganic growth. It must be noted that the organic growth estimates concern the internal projects for the company. Another factor to be taken into account in organic growth is the investments required and spent alongside the time periods used thus quantification exercises must be made consistently. This is a qualitative check whenever dilemmas or issues might arise from using this strategy.
The business owners and management team must always be prepared for any possible risks and disadvantages that might arise whenever the plans don't work out. There is a need to constantly meet with the marketing and administration teams and departments to clarify that the experimental strategies and methods are not static but are always changing. Having this in mind will help the business leaders and officials to be prepared for any possible liability or risk-taking projects. Puranam furthermore clarified that obviously, organic is far cheaper than inorganic growth. The point of beginning is to acquire an accurate clarity on the resource gap such as for example are the different resources that are very much needed in entering the new business but is known to be not yet used within the company. In case, no part...