COLLEGE OF ACCOUNTANCY

ASSIGNMENT IN
BUSINESS POLICY AND STRATEGY

Submitted by:

Maria Cristina D. Ramirez

5 - BSA

Submitted to:
Mr. Benjamin Bunyi

February 2020
1. Make a research of the following:
A. Level of Strategies with person most responsible

a. For Large company

Strategy can be formulated at three levels, namely, the corporate level, the business level,

and the functional level. At the corporate level, strategy is formulated for your

organization as a whole. Corporate strategy deals with decisions related to various

business areas in which the firm operates and competes. At the business unit level,

strategy is formulated to convert the corporate vision into reality. At the functional level,

strategy is formulated to realize the business unit level goals and objectives using the

strengths and capabilities of your organization. There is a clear hierarchy in levels of

strategy, with corporate level strategy at the top, business level strategy being derived

from the corporate level, and the functional level strategy being formulated out of the

business level strategy.

In a single business scenario, the corporate and business level responsibilities are clubbed

together and undertaken by a single group, that is, the top management, whereas in a multi

business scenario, there are three fully operative levels.

Levels of Strategy
Levels of Strategy

Corporate Level

Corporate level strategy defines the business areas in which your firm will operate. It

deals with aligning the resource deployments across a diverse set of business areas, related

or unrelated. Strategy formulation at this level involves integrating and managing the

diverse businesses and realizing synergy at the corporate level. The top management team

is responsible for formulating the corporate strategy. The corporate strategy reflects the

path toward attaining the vision of your organization. For example, your firm may have

four distinct lines of business operations, namely, automobiles, steel, tea, and telecom.

The corporate level strategy will outline whether the organization should compete in or

withdraw from each of these lines of businesses, and in which business unit, investments

should be increased, in line with the vision of your firm.

Business Level

Business level strategies are formulated for specific strategic business units and relate to

a distinct product-market area. It involves defining the competitive position of a strategic

business unit. The business level strategy formulation is based upon the generic strategies

of overall cost leadership, differentiation, and focus. For example, your firm may choose

overall cost leadership as a strategy to be pursued in its steel business, differentiation in

its tea business, and focus in its automobile business. The business level strategies are
decided upon by the heads of strategic business units and their teams in light of the

specific nature of the industry in which they operate.

Functional Level

Functional level strategies relate to the different functional areas which a strategic

business unit has, such as marketing, production and operations, finance, and human

resources. These strategies are formulated by the functional heads along with their teams

and are aligned with the business level strategies. The strategies at the functional level

involve setting up short-term functional objectives, the attainment of which will lead to

the realization of the business level strategy.

For example, the marketing strategy for a tea business which is following the

differentiation strategy may translate into launching and selling a wide variety of tea

variants through company-owned retail outlets. This may result in the distribution

objective of opening 25 retail outlets in a city; and producing 15 varieties of tea may be

the objective for the production department. The realization of the functional strategies in

the form of quantifiable and measurable objectives will result in the achievement of

business level strategies as well.

 Summary:

Corporate Level Strategy:

Defines the business areas in which your firm will operate.

Involves integrating and managing the diverse businesses and realizing synergy at the

corporate level.

Top management team is responsible.

Business Level Strategy:

Involves defining the competitive position of a strategic business unit.

Decided upon by the heads of strategic business units and their teams.

Functional Level Strategy:

Formulated by the functional heads along with their teams.

Involve setting up short-term functional objectives.

b. For Small company

The Power of Strategy

As a leader, your first task is to ask yourself how will you ensure that your company

thrives. How can you make sure that your business flourishes? This question will orient

you as you consider the levels of strategy. A strategy is a plan of action you take to

achieve a specific goal. How will you meet your sales goal? How will you improve

customer service? How will you better track inventory?

You must answer these questions:

 Why does my company exist?

  How will I conduct myself as a representative of my company?

 How will my company behave?

 Where are we going? Where will be in five, 10 or 20 years?

 How will we meet our goals?

 What does my company need right now to grow?

 With sound strategy, you can.

By answering these questions, you can ensure that you stay laser focused on your

goals. The power of strategy is that it can help you stand out from the crowd. As a

business owner, you must discover and hone your competitive edge. What is it that sets

you apart from your competition? What are your strengths? The strategies you come up

with should always play to those strengths.

The Top-Level View

The three levels of service that are:

The corporate level

The business level

The functional level

At the corporate strategy level, you’re answering a fundamental question: what do you

want to achieve? At the business unit level, you’re deciding which industries you will
operate in and how you will compete with competitors. At the functional level, you’re

deciding how to organize your company and how much delegation you want to do.

The Corporate Level

The corporate level is the highest level of business strategy, and it is the broadest. You

should craft your corporate-level strategy with your main purpose in mind. This is the

place to set lofty, long-term goals. These goals impact the other two levels. Put another

way, your business and functional goals should relate to your corporate goals and vice

versa.

It’s at this level that you craft your mission and vision statements. To craft the best

corporate strategy you can, clarify your mission. With your mission statement, you

describe what your company does and how it differs from the competition.

With your vision statement, you state how you want your company to be operating at a

specific time in the future. It’s not uncommon for business owners to craft vision

statements for the next five, 10, 15 or even 20 years.

Create Corporate Objectives

You will also want to create your corporate objectives at this level. Here, you should

state targeted, high-level goals. Focus on specific financial, internal, customer and

growth goals. If you were starting a dog grooming company, you might create a

specific per hour earnings goal.

Because customer service and word of mouth are so crucial in that industry, you might

also might set a measurable customer satisfaction goal. On the internal side of things,

you might decide that you want to be able to hire five employees within two years.

The Business Unit Level

Here you would define separate strategies for the various industries you operate in.

Business owners who operate in many different niches must decide which to focus on

most, and that may change over time. At the business unit level, you may decide to

make a graceful exit from an under-performing market. Or, you may even decide to sell

off individual business units.

If you operate only in one industry or niche, you might not find much to do here. That

said, there is work you can do. For one thing, it’s at this level that you decide how you

will differentiate yourself from the competition.

What is it that makes your business special? How is your product or service superior?

Now is the time to poke your head up and perform SWOT analysis: strengths,

weaknesses, opportunities and threats.

Define Your Strategies

The strategies you define here should specify objectives that both support each

business unit and the company as a whole. For instance, the dog groomer may create a
growth strategy that would allow him to branch out into grooming other animals or

performing similar services.

It's important to note that in this scenario, the new business unit would be compatible

with the original service. This keeps costs low and also ensures that the original

business unit continues to perform well.

The Functional Level

When you craft functional level strategy, you're concerned with smooth internal

operation. This involves how departments operate and interact, and how they support

your corporate level strategy day in and day out. Typically, your department heads

would craft and carry out your functional level strategy. But if you’re a startup, you

may need to take the reigns here, too.

If you have department heads, your functional-level strategy will help them keep things

running smoothly. Whether you have departments or not, it’s never too early to start

working on your functional strategy.

Functional Level Strategy

It’s at this level that the rubber meets the road. If projects aren’t created and efficiently

executed, your entire business will suffer. So, your functional level strategy should

provide ways of measuring progress. You, or your department heads, should be able to

answer these questions at all times:

How close are we to meeting our current objectives?

What are the most important steps we can take right now to meet these objectives?

In other words, while you will have objectives, projects and goals at every level of your

organization, they should be particularly granular at the functional level.

Aligning Goals at All Three Levels

You want to ensure that the goals at the functional level align with your goals at the

corporate level. For instance, all departments in your organization should focus on

creating a quality product, and all departments should be concerned with delivering

stellar customer service. The difference is that at the functional level, your teams

should be creating specific plans to achieve these goals.

Our dog groomer may have a department head, who focuses on booking new customers

and another, who focuses on the day-to-day operations. Both teams utilize specific

strategies that enable them to excel, but both are also focused on growing the company

as a whole.

Perhaps the most important takeaway is that your strategy at all three levels should

align. If it does not, you will be trying to move in three directions at once. As the

saying goes, a house divided against itself cannot stand. Build a sturdy foundation

today by working on all three levels of business strategy.

B. Three (3) – Stage Decision Matrix

a. Input Stage

External Factor Evaluation Matrix

Competitive Profile Matrix

 Internal Factor Evaluation Matrix (IFE)

b. Matching Stage

SWOT Matrix
SPACE Matrix
Boston Consulting Group (BCG) Matrix

Business portfolio analysis

BCG Matrix graphically portrays differences among divisions in term of

relative market share and industry growth rate.

Relative market share is the ratio of a division’s own market share to the

market share of the largest rival firm in that industry.

The growth rate % on the y axis range from -20 to + 20 %.

Internal-External Matrix, Grand Strategy Matrix
c. Decision Stage

Quantitative Strategic Planning Matrix

QSPM is a tool that allows strategists to evaluate alternative strategies

objectively but it requires good intuitive judgment.