The strategy of your company ? Also known as “master strategies” or “corporate strategies,” they refer to the strategies applied at the company level and designed to determine the options and directions the company will follow to achieve its desired goals. These strategies involve decisions to select long-term plans from a range of available alternatives.
There are four major strategic alternatives that the company can follow to move towards achieving its long-term goals, and they include a “stability strategy,” an “expansion strategy,” a “retrenchment strategy,” and a “combination strategy.”
The nature of business within the company is divided into three dimensions: customer groups, customer functions, and technology alternatives, where the first dimension refers to a specific category of people to whom goods and services are provided and the second dimension refers to the product. or the service being provided. while the last dimension includes any technical changes that occur to the company’s operations in order to improve its efficiency.
Grand strategies are concerned with decisions related to the allocation and transfer of resources from one company to another and the management of the business portfolio efficiently and effectively, all in pursuit of the company’s overall goal. For this reason, the company has a group of major strategic alternatives to choose the most appropriate among them.
Stabilization strategy
The company adopts a strategy of stability when it tries to maintain its current position while focusing only on gradual improvement or development by changing one or more of its operational processes from the perspective of the aforementioned three dimensions, which are customer groups, customer functions, and technology alternatives, whether individually or collectively.
Companies that try to avoid risks adopt this strategy, and such companies are usually small in size or the market conditions in which they operate are not conducive to their procedures. If the company is satisfied with its performance, it does not make any major changes in its operational processes. We also find that the stability strategy is safe for hesitant companies or those that do not accept change easily, as they will not need to search for any other alternative options.
Expansion strategy
The company adopts this type of strategy when it is trying to achieve significant growth compared to its previous achievements. That is, the company follows this expansion strategy when it aims to grow significantly by expanding the scope of one of its operations within the company from the perspective of the aforementioned three dimensions, whether individually or collectively.
The reason that drives the company to expand is attributed to several things, one of which may stem from the desire for the company to stand firm in the market, achieve a greater percentage of profits, enhance its position, double its production, enlarge its market shares, achieve certain social benefits, and many others.
This kind of strategy is adopted by a company that has a distinguished management team in terms of achievement and knowledge, so that their main goals are to develop and improve the company regardless of the risks or obstacles that stand in their way.
Strategy to reduce activities and procedures
The company adopts this strategy when it aims to reduce one or more of the activities included in its operations, with the aim of reducing expenses and reaching a more stable financial position. That is, it can be said that the company follows this strategy when it decides to reduce the number of its activities by reducing the steps used in its operational processes, whether individually or collectively, from the perspective of customer groups, customer functions, or technology alternatives.
Composite strategy
It is the strategy that includes the company’s use of more than one of the aforementioned strategies at the same time, meaning that the company merges or combines two or three strategies within its operational processes in order to improve its efficiency. The company that follows this strategy is usually large in terms of its size and complex in terms of its operations and procedures, so that there are many businesses listed within its multiple divisions, which in turn serve different purposes and objectives.
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