Types of strategies in business. Types and types of enterprise development strategies
A key component of any management process- strategy. In its framework, it is viewed as a long-term development direction for the development of the company (in particular, the strategy covers the scope, forms, means of its activities, the system of internal relationships between all participants, the firm's position on the environment).
For greater clarity, it is worth distinguishingconcepts as the goals and strategy of the organization: the first reflect the ultimate point of desire, the second - the ways and its achievements in a dynamic competitive atmosphere.
In a broad sense, strategy is the planned general course of action of the company, the pursuit of which should lead in the long term to the desired goals.
What does the management face in determining the effective strategy of the company?
At the first stage it is necessary to find answers to three main questions about the organization's position in the market, namely:
- What kind of business should I stop?
- What should be given more attention?
- What kind of business is worth looking into.
A variety of the company's strategies for M. Porter
Professor identifies three main areas of development of the company's behavioral strategy in the market:
1. Leadership in the field of minimizing production costs. This type is characterized by the fact that the company reduces the level of costs for production, selling products to a minimum, as a result of which it attains a greater market share relative to its competitors.
Typical features of companies using this type of strategy:
- high level of organization of production, supply;
- advanced technologies and engineering and design base;
- an extensive distribution system;
- low-grade marketing.
2. Specialization of production. Typical is the uniformity of the technological process and products, the use of special equipment and specialized personnel. Effect - consumers buy products of this firm, even at an inflated price.
Typical features of firms with this version of the strategy are as follows:
- extensive potential for R & D;
- highly qualified designers;
- quality control of the products;
- effective marketing system.
3. Fixation on a separate market segment. The company does not focus on the entire market, but only on a certain group of consumers. In this situation, it can pursue either the aforementioned specialization policy, or minimization, or both at the same time. The peculiarity of this type of strategy is the focus on the needs of not the entire market, but the target group of consumers.
The types of competitive strategies consideredallow to solve the main task for the majority of firms: achievement of advantage before direct competitors. They also help in determining how this can be done.
Types of business development strategies
Those who are entrenched in practice, have receivedthe name of the basic. They distinguish four different approaches related to the growth of the company associated with the change in the basic state of one (or several) elements, such as the market, the position of the company within the industry, the product, industry, technology. Each of the above components can be in one of two states: current or fundamentally new.
Types of strategies of the first group - strategiesconcentrated growth (associated with a change in the market or product, or both at the same time). Following this course, companies are trying to improve the product or try to produce a new product, while remaining in the old industry.
As for the market aspect, the organizations are looking for opportunities to improve the existing situation in the market.
The strategies of the first group
It is customary to distinguish three types:
- Strategy to strengthen the market position (the company focuses on marketing, performs horizontal integration - control over competitors).
- Strategy of market development (search for new markets for the product).
- The strategy for the development of the previously produced product (the transition to the production of a fundamentally new product within the old distribution channel).
The second group of strategies
Landmark - expansion of the company throughjoining of new structures. The types of business strategies of this group are referred to as integrated growth strategies. Companies resort to them in a situation where the business is fairly stable, and you can not follow the first group described above. In this case, integrated growth does not hinder the company's long-term goals. It can be achieved through the acquisition of property, as well as expansion from within.
Integrated Growth Strategies
They include the following types of strategies:
- Reverse vertical integration (the growth of the company through the introduction or strengthening of existing control over all suppliers, the establishment of a number of subsidiaries for the supply).
- Forward vertical integration (growthorganizations through the introduction or strengthening of existing monitoring over their structures located above the distribution and sale systems). This type is effective in case of significant expansion of intermediary services or the absence of first-class intermediaries.
These are strategies for diversified growth. They are resorted to if companies can no longer develop in their market, with their products and within their industry.
The types of strategies of this group are as follows:
- Centrified diversification (search and application of additional opportunities in the field of production of fundamentally new products along with the existence of the old business at the central positions).
- Horizontal diversification (the search for opportunitiessignificant growth of the company on the market already mastered by means of a new product, which requires a different technology). Here, the organization should focus primarily on manufacturing technologically independent products that could use the already available capabilities of the company, for example, in the supply sector. In view of the fact that the new product is targeted at the target segment of the old (main) segment, it must act on the qualitative characteristics of the accompanying product already produced. An important condition is the preliminary assessment by the organization of its own competence with respect to the production of a new product.
- Conglomerative diversification (extensionthe company through the production of principally new products within the undeveloped sales system). It is generally accepted that this is one of the most difficult from the point of view of implementing development strategies due to the fact that its successful implementation directly depends on numerous factors: the competence of the staff, the seasonality of the market, the qualifications of managers, the availability of required capital,
Types of enterprise strategies by level of management
A large-scale organization with a divisional type of structure most often has three levels of basic strategic decisions:
In other words, these are types of strategies, productivethe result in the implementation of which can be obtained only under the condition of their close interaction. Each separate level forms a certain strategic environment for the next (the strategic plan of the lower level is directly dependent on the limitations of the strategies of the higher ones).
Three levels of key strategic decisions
The first strategy (corporate, portfolio)describes the general direction of growth of the company, the development of its activities in the production and sales sphere. It shows ways to achieve a balance of goods and services through competent management of various types of business. Strategic decisions of this level are recognized as quite complex in view of the fact that they concern the organization as a whole.
The corporate strategy includes the following areas:
- distribution of resources on the basis of portfolio analysis between the relevant business units;
- production diversification as a way to reduce potential business risks and achieve synergy effects;
- change in corporate structure;
- merger, acquisition and entry into such an integration structure as a FIG;
- universalization of the strategic orientation of units.
An important decision made at this level is to finance products or business units solely on a budgetary basis.
Types of enterprise strategies by level of managementalso represented by a business strategy (business), which provides long-term competitive advantages of the business unit. It is embodied, as a rule, in business plans and reflects the facts about the competitiveness of a given enterprise within a specific product market (target segment, price and marketing policy, competitive advantages, etc.). In this regard, it is also mentioned, listing the types of competitive strategies. For organizations engaged in one activity, corporate strategy is identical to business.
Functional strategies are being developed.functional services and departments of the company on the basis of the above (financial, industrial, product, marketing strategy, etc.). Their goal is to allocate the resources of a service (department), to search for the effective behavioral course of the functional unit in the overall strategy. An example within the marketing department is to focus on finding ways to increase sales of products relative to the previous period.
Innovative strategies: interpretation, types
This is a model of firm behavior in certainmarket conditions. This strategy is one of the tools for managing an organization. Based on the behavioral aspect and content, the following types of innovative strategies are distinguished:
a) technological leadership (development of a new type of product and technology, investment in research and development, the latest management models, even in situations of increased risk);
b) following the leader (using technologies developed by other companies);
c) copying (organization of production based on a license purchased from a leader or developer);
d) dependence (imitation of a new product).
Innovative strategies can also be categorized by scale:
- targeted to a specific niche;
- aimed at multiple markets;
The content of the following types of innovative strategies:
- information processes;
- management models;
- social change.
The starting point is the mission (the formulation of the idea, because of which the company was created). On its basis, a general development strategy of the company is being developed.
All of the above types of innovation strategies have the following initial stage:
- assessment of the existing external environment of the company;
- characteristics of the features of the internal environment (scientific, technical, innovative potential, etc.).
Variety of marketing strategies
They can be classified according to the following landmarks:
1. In relation to the scale of the market:
- strategy of conquest (new product development, consumer motivation, development of new areas of consumption of old products);
- expansion strategy (increasing output, conquering new market segments);
- segment monopolization (search for a target group of consumers in which there are no competitors, creation of a new product for them, consumer motivation in this segment);
- retention of its market share in all target segments (development of the full range of goods of the corresponding type).
2. According to the fundamental factor that provides demand, the following types of marketing strategies are distinguished:
- high-demand goods (emphasis on making the goods necessary for the majority of consumers without reference to group affiliation);
- high quality of products (emphasis on the highest possible quality among the products offered on the market for this product);
- price level (pricing policy regarding the products that are available to the majority);
- innovation (creating a product that has no analogues);
- customer commitment (benchmark - complete satisfaction of existing customer needs);
- after-sales service (focus on the after-sales service package);
- additional monetary advantage (credit system, discounts, bonuses, installment plans).
3. According to the degree of development of the marketing policy, the following strategies are distinguished:
- adaptation to demand (marketing research, the definition of consumer demand, the creation of a product that meets the needs);
- creation of demand (the formation of the idea of a product, its development, stimulating the needs of customers in the created product)
4. According to the reaction to the existing market processes, the following types of enterprise strategies (marketing) are distinguished:
- adaptation to the changes taking place (observation of the current state of the market and prompt response to its change);
- forecast (advance conversion based on the compiled forecast).
5. In response to the dynamics of market conditions, marketing strategies are divided as follows:
- adjustment of production volumes (reduction or increase in production volumes based on changes in consumer demand);
- changing the range (improvement of the product and its varieties, modification, creation of substitutes);
- price changes (pricing policy adjustment);
- change of sales channels (use of various kinds of sales).
6. In relation to the product, it is customary to single out the following types of organization strategies (marketing):
- innovation (creating a new product, the company's desire to lead in the relevant market);
- “Second place” (following the leader);
- improvement of competitive products (change or refinement of competitive products through the addition of its advantages).
Personnel strategies: definition, types
This is the development of a priority management team.and the most effective course of action conducive to the achievement of such long-term goals as the creation of a highly qualified, cohesive, responsible team, subject to the existing strategic objectives of the company and its capabilities.
It is accepted to distinguish the following types of personnel strategies:
- dynamic growth;
- the cycle.
According to the majority of leading firms, the personnel strategy is an integral part of the overall economic, as well as a consequence of the long-term planning of the economic activities of companies.
Summing up, it is worth reminding once again that the main types of competitive strategies are cost leadership, focusing and differentiation.
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