Q.1 Explain the corporate strategy in different types of organization.

A well-formulated strategy is vital for growth and development of any organization, whether it is small business, a big private enterprise, a public sector company, a multinational corporation or a non-profit organization. But, the nature and focus of corporation strategy in these different types of organizations will be different, primarily because of the nature of their operation and organization objectives and priorities. Small business for generally operate in a single market or a limited number of markets with a single product or a limited range of products. The nature and scope of operations are likely to be less of a strategy issue than in larger organizations. In larger business or companies-whether in the private sector, public sector or multinationals, the situation is entirely different. Both in internal and external environment and the organizational objectives and priorities are different. For a large private sector enterprise, there is a clear growth perspective. For all such companies, both strategy planning and management play dominant roles. Multinational have a greater focus on growth and development and also diversification in term of both products and markets. This is necessary to remain internationally competitive and sustain their global presence. Multinational companies are already operating multi location strategies. In public sector companies, objectives and priorities can be quite different from those in the private sector. Generally of employment and maximization output may be more important objectives than maximizing profit. In non-profit organization the focus on social responsibilities is even greater than in the public sector. In this organization ideology and underlying values are of central strategic significance. Many of these organizations have multiple service objectives, and the beneficiaries of services are not necessary the contributors to revenue or resource. All these make strategic planning and management in these organizations quite different from all other organizations.

Q.2 What is the role consultant play in the strategic planning and management process of a company? Is it an essential role?
Management consultants can play very useful roles in the strategic planning process of a company. Consultant renders services in different functional areas of management including the strategy planning and management process. Evan in companies with a corporate planning division/unit, consultants may provide specialized inputs or insights into identified management or strategy areas. Top strategy consultants like McKinsey & Company use or develop latest tools, techniques or models to work out solutions to specific strategy management problems or issues be it productivity, cost efficiency, restructuring, long term growth or diversification. There are many international consultants who are in demand in different countries. There are also national consultants. Leading international consultants, in addition to McKinsey & Company, are Boston Consulting Group (BCG), Arthur D little and Accenture. Prominent Indian consulting companies are A F Ferguson, Tata Consultancy Services and ABC Consultants. Consultants, sometimes have a difficult or delicate role to play. In many companies, a situation develops when the chief executive or the top management needs to bank upon the support of an external agency like a consultant to push through a strategic change in the organizational structure or management system of the company. It may be for growth and development or downsizing. In both cases, many companies face internal resistance to change. The resistance is more if it is downsizing even when it is required for turning around a company. This happens particularly in public sector companies where implementing change is always difficult. Consultants are engaged to support or subtending the companys point of view so that change is more easily acceptable to the internal stakeholder of the company. Consultants role may become dedicate and, sometimes, tricky in such cases, and they should carefully weigh the ethical implication of their participation.

Q.3 What is strategy audit? Explain its relevance to corporate strategy and corporate governance.
Strategic audit is a formal strategic-review process, which imposes its own discipline on both board and the management very much like the financial audit process. But it is different from management audit, which is undertaken in many companies by the senior/top management on the progress and outcome of important corporation activities. Donaldson has specific five elements of strategic audit. Establishing criteria for performance Database design and maintenance Strategy audit committee Relationship with the CEO Alert to duty (by board members)

The analysis so far focused on different aspect or characteristics of corporate strategy and corporate governance, the way they are differentiated and areas of complementarities and some possible conflicts between two. Some difference begins between the two and also is the sources of some possible conflict. The most important objective of corporate governance is to protect the interests of the stockholders whose primary concern is maximization of return on investment or short-term profitability. The objective of corporate strategy is more to focus on long-term growth and profitability conflict in many companies. That is matching or balancing the short-term and long-term goals of the organization. In corporate governance, there is a growing emphasis on inclusiveness or inclusive governance, i.e. focusing on the society, Community and environmental development. The board represent the owners, the CEO represent the management. Therefore, there can be a conflict or at least, sensitivity between the two. But, in many companies, managers and directors realize/agree that the board should only be a watchdog without undermining the managements ability to run the business. The board should also decide how to distance itself from the CEO in the course of normal management of business and at the same time, maintain a positive and constructive relationship.

Q.4 What is Corporate Social Responsibility (CSR)? Which are the issues involved in analyzing of CSR? Name three companies with high CSR rating.
External stakeholders of an organization are too many and varied and many of them represent different sections or social groups. This implies that organization should be socially responsible. That is in addition to the interests of the shareholders, businesses or companies should also serve the society. This is Corporate Social Responsibility (CSR). Corporate social responsibility can be defined as the alignment of business operations with social values. The issues between internal and external stakeholders can go much further than mentioned so far. Some feel that is the most problematic issue in deciding company responsibility. External stakeholders argue that internal stakeholders demanded be made secondary to the greater need of the society, that is greater good of the external stakeholders. Many of them feel that issues like pollution, waste disposals, environmental safety and conservation of natural resources should be the overriding considerations for formulation of policy and strategic decision making. Internal stakeholders, on the other hand, think that the competing or social claims of external stakeholders should be balanced in such a way that it protects the company mission, objectives and profitability. Strong exponents of CSR also talk of social policy for companies. They feel social responsibility of companies should be clearly enunciated and declared as social policy. Social policies may directly affect a companys products and services, technology, markets, customers and self image. According to these thinkers, an organizations social policy should be integrated into all management activities including the mission statement and objectives. CSR initiatives of companies are observed with interest. The Wall Street Journal has rated top 12 companies in term of their social responsibility. These companies are: 1. Johnson & Johnson 2. Coca-cola 3. Wal-mart 4. Anheuser Bush 5. Hewlett-packard 6. Word Disney 7. Microsoft 8. IBM 9. McDonalds 10. 3M 11. USP 12. FedEX

Q.5 Distinguish between core competence, distinctive competence, strategic competence and threshold competence. Use example.
Four major types or levels of competence may be distinguished: CORE COMPETENCE Core competence of a company is one of its special or unique internal competences. Core competence is interwoven resources, technology and skill or synergy culminating into a special or core competence. Core competence gives a company clear competitive advantage over its competitors. EX. Sony has a core competence in miniaturization; Xeroxs core competence is in photocopying. Canons core competence is lies in optics, imaging and laser control. Hondas core competence is in engines, 3Ms core competence is in sticky tape technology. Hamel and Prahalad, two of the greatest exponents of core competence, argue in The Core Competence of the Corporation. DISTICTIVE COMPETENCE Distinctive competence may be providing an answer to some of these points. Distinctive competence is based on the assumptions that are different alternative ways to secure competitive advantage and not only special technical and production expertise as emphasized by core competence. EX. Product or process superior, product differentiation, cost effectiveness or cost efficiency to support a price strategy, special capability in market or distribution, etc. Under given circumstances one of these or a combination of some of these, will produce a distinctive competence which would be appropriate or best suited to exploit opportunity and produce desired result. STRATEGY COMPETENCE Strategy competence coexists with, or support core competence and distinctive competence. Strategy competence is the competence level required to formulation, implementation and produce results with a particular strategy. EX: Hindustan Unilever did this. In the mid-and the late 80s they used their strategy competence to out manouvre Nirma and re-establish their leadership in the detergent market. THRESHOLD COMPETENCE Threshold competence is the competence level required just for survival in the market or business. The competence level of a company may be weaker than many of its competitors. Threshold competence may be adopted by no. 5 and no. 6 player in the market or those struggling to survive. EX: Multi-product or multi-SBU may often possess a portfolio of competence.

Q.6 What is global industry? Explain with examples, international strategy,

DEFINITION OF GLOBAL INDUSTRY In global industry the strategic position of companies in different countries or national markets are governed by their overall global positions. For example IBMs strategic position in competing for computer sales in France and Germany has improved significantly because of technology and marketing skills developed in other countries. Global Industry, an industrys economics and competitors in different national markets should be considered jointly rather than individually. INTERNATIONAL STRATEGY International strategy can be adopted for those product and services which are not available in some countries and can be transferred from other countries. Some example are: Kelloggs, Indian software, and Indian handicrafts. MULTIDOMESTIC STRATEGY Multidomestic strategy is almost opposite of international strategy. Multidomestic strategy involves high degree of local responsiveness or local content. Products are highly customized to suit local requirement or conditions. Because of high customization, cost pressure is less, cost effectiveness may be also difficult to achieve because of lack of scale economy. Example: Asian Paints, Indian garments. GLOBAL STRATEGY Global strategy suits companies which make highly standardized sophisticated products, and are in a position to reap benefits of economies of scale and experience effects. These are including high technology products which have universal applicability and hardily required any local adaptation. Examples are: Intel, Motorola, Microsoft, and Taxes Instruments. TRANSNATIONAL STRETAGY Translation strategy is the most difficult strategy to follow because this is based on a combination of two apparently contradictory factors. Cost effectiveness and lo9cal adaptation. Many companies are adopting this approach to become successful. Some good Examples are: Caterpillar, McDonalds, Coca-Cola, Pepsi and Dominos Pizza. Many multinational FMCG companies like Unilever and Procter & Gamble follow transnational strategy through their fully owned subsidiaries in different countries.