Q.What is strategy?Explian the four genric strategies as disscussed by Gluck and Jauch.
1.Strategy is the creation of a unique and valuable position involving a diffrent set of activities.
2. Strategy requires you to make trade-offs in competing to choose what not to do.
3.Operational effectivness is not strategy,it is necessary but not sufficient.
4.The role of strategy is to identify the general approaches that the organization utilize to achive its organizational objectives.
5.Strategy means by which long-term objectives will be achived.
6.Strategy is forward looking and it has oriention towards future.Strategic action is required in a new situation.
According to Gluck and Jauch ther are 4 ways in which startegy alternative can be considered---
1. Stability Strategies –
One of the important goal of business enterprises is
Stability to safeguard its existing intrest and strength.
To pursue well established and tested objectives.
To continue in the choosen business path.
To maintain operational efficiency on a sustained basis.
To consolidate the commanding position already achived.
To optimise returns on the resources committed in the business.
2. Expansion Strategy –
Expansion is a promising and popular strategy that tends to be equated with dynamism,vigor,promise and success.
It’s often characterised by significant reformulation of goals and directions.
Major initiatives and moves involving investment
New technology and new markets
Exapansion includes diversifying,acquiring and merging business.
3. Retrenchment Strategy –
A business organisation can redfine it’s business by divesting a major produc line or market.
Retrenchment or retreat becomes necessary or expedient for caping with particullary mostlly and adverse situation in the environment and when any other strategy is likely to be suicidal.
In business parlance also retreat is not always a bad proposition to save the enterprises vital intrest.
To minimize the adverse envirnment effets.
Even to regroup and recoup the resources before a fresh assault and acent on the growth ladder is launched.
4. Combination strategy -
Stability,expansion or retrenchment startegies are not muttually exclusive.
It is possibale to adopt a mix to suit particular situation.
An enterprises may seek
- Stability in some area of activity
- Expansion in some area and
- Retrenchment in others.