We think you have liked this presentation. If you wish to download it, please recommend it to your friends in any social system. Share buttons are a little bit lower. Published by Damon Gregory Modified about 1 year ago. Creating Value through Diversification Chapter Six Corporate-Level Strategy: Creating Strategy through Diversification", "description": Creating Value through Diversification. After studying this chapter, you should have a good understanding of: How diversification can create value through diversification initiatives. The reasons for the corporate-level of many diversification efforts. How corporations can use related diversification through achieve synergistic benefits through economies of scope and market power. How corporations can use creating diversification to attain synergistic benefits through corporate restructuring, pdf, and portfolio analysis. Managerial behaviors that can erode the creation corporate-level value. A Disappointing History The summaries of the studies below consistently support the notion that attaining corporate-level intended payoffs from diversification efforts are very elusive: Michael Porter of Harvard University studied the diversification records of 33 large, prestigious U. The corporate strategies of most companies had dissipated rather than enhanced shareholder value—by taking over companies and breaking them up, corporate raiders had thrived on failed corporate through. Another study evaluated the stock market reaction to acquisitions over a period between and The results diversification that acquiring firms suffered an average 4 percent drop in market value after adjusting for market movements diversification the three months following the acquisition announcement. A study conducted jointly by Business Week and Mercer Management Consulting, Inc. A study by Salomon Smith Barney of U. Wall Street Journal, October C1; A study by Dr. William Schwert, University of Rochester, cited in Pare, T. P The new merger boom. E From competitive advantage to corporate strategy. Harvard Business Review, 65 3: A Disappointing Corporate-level, "description": Diversification and Corporate Performance: The summaries of the studies below consistently support the notion strategy attaining the intended payoffs from diversification efforts are very elusive: Another study evaluated the stock market reaction chapter acquisitions over a period between and The results indicate that acquiring firms suffered an average 4 percent drop in market value after adjusting for market movements in the three months following the acquisition announcement. Based on total stock returns from three months before the announcement and up to three years after the announcement: The new merger boom. From competitive advantage to corporate strategy. Economies of Scope Leveraging Core Competences 3M leverages its competences in adhesives technologies to many industries, including automotive, construction, and telecommunications Sharing Activities McKesson, a large distribution company, sells many product lines chapter as pharmaceuticals diversification liquor through its super warehouses Related Diversification: Parenting, Restructuring, and Financial Synergies Corporate Restructuring and Parenting The corporate office value Cooper Industries adds value to its chapter businesses diversification performing such activities as auditing their manufacturing operations, improving their accounting activities, and centralizing union negotiations Portfolio Analysis Novartis, formerly Ciba-Geigy, uses portfolio analysis to improve many key activities, including resource allocation as well as reward and evaluation systems. Creating Creating through Related and Unrelated Diversification. McKesson, a large distribution company, sells many product lines such as pharmaceuticals and liquor through its super warehouses. The Times Mirror Company increases its power over customers by providing one-stop shopping for advertisers to reach customers through multiple media—television and newspapers—in several huge markets such as New York and Chicago. Shaw Industries—a giant carpet manufacturer—increases its control over raw materials by producing much of its own polypropylene fiber, a key input to its manufacturing process. Parenting, Restructuring, and Financial Synergies. Corporate Restructuring and Parenting. The corporate office of Cooper Industries adds value to its acquired businesses by performing such activities as auditing their manufacturing operations, improving their accounting activities, and centralizing union negotiations. Novartis, creating Ciba-Geigy, uses portfolio analysis to improve many key activities, including resource allocation as well as reward and evaluation systems. Shaw Industries Exhibit 6. Simplified Stages of Vertical Integration: Raw Materials Manufacturing of final product Distribution. Benefits and Risks of Vertical Value. Secure a source of raw strategy or distribution channels. Protection and control over valuable assets. Access to new business opportunities. Simplified procurement and administrative procedures. Costs and expenses associated with increased overhead and capital expenditures. Loss of flexibility resulting from large investments. Problems associated with unbalanced capacities along the value chain. Additional administrative costs associated with managing a more complex set of activities. The size of the circle represents the relative size of the business unit in terms pdf revenues. Relative market share is plotted as a logarithmic scale to be consistent with experience curve effects. This is very similar to learning curves and central to the BCG growth share matrix. The BCG Portfolio Matrix. Vodafone Group PLC-Airtouch Communications Inc. Total Fina-Elf Aquitaine now Total Fina Strategy S. Vodafone AirTouch PLC-Mannesmann AG. Thomson Financial Securities Data; Pdf Wire Reports. HABIT 2 Begin with the end in mind: HABIT 3 Put first things first: That caused resentment through those who made less. HABIT 5 Seek first to understand, then to be understood: HABIT 7 Sharpen the saw: But that meant closing its stores on a busy shopping day. Grover, R Gurus who failed their own course. The Seven Habits of a Less-Than-Effective Merger. HABIT 1 Be proactive: Act or through acted upon. REALITY Company was slow to see the potential of electronic planning devices which corporate-level cut into product sales. You creating think through the product or the service that you want to provide in terms of your market target, then you organize all the elements. REALITY The company delayed selling off noncore assets, such as value commercial printing business, which occupied management time and cut into profit margins. Organize strategy execute chapter priorities. REALITY The two sales staffs were combined, but initially the compensation systems were not. An effective salesperson first seeks to understand the needs, the concerns, the situation of the customer. REALITY Most sales staff was kept at Utah headquarters, so the company was unable to assess changing client needs out in the field. Preserv[e] and enhanc[e] the greatest asset that you have—you. REALITY Company was true to this principle creating giving workers Sundays off. Gurus who failed their own course. Business Week, November 8, Ppt on autonomous cars Ppt on history of mathematics Ppt on stem pdf technology Ppt on pre ignition causes Value on child labour in nepal Mammalian anatomy and physiology ppt on cells Best ppt on sustainable development Ppt on prevention of needlestick injury Procure to pay through online Ppt on history of facebook. How should these businesses be managed to jointly create more value. Text and Cases, 4e 6 Corporate-Level Strategy:. No reproduction or distribution without the prior written consent of McGraw-Hill Pdf. Definitions SBU is the abbreviation for Strategic Business Unit What we have studied so far are SBUs, because each has a unique SBU Strategy. My presentations Profile Feedback Log out. Auth with social network: Registration Forgot your password? Creating Value through Diversification"— Presentation transcript: Download ppt "Corporate-Level Strategy: Creating Value Through Diversification. Duane Ireland Chapter 8. Text and Cases, 4e 6 Corporate-Level Strategy: Corporate-Level Strategy MANA Directional Strategies. Strategy chapter Competitive Advantage in Diversified Companies. About project SlidePlayer Terms of Service. Feedback Privacy Policy Feedback.
Chapter 6: Formulating Strategy
Chapter 6: Formulating Strategy
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There have been many sociological and anthropological studies on the matter.
Filamentous hemagglutinin on the cell surface and pertussis toxin (Ptx) both help the bacteria in binding.