Paññāsāstra University of Cambodia

Subject:Business Planning and Policy Development

Chapter 5

STRATEGIES IN ACTION

Prof: PEN RATANA1

Group 5 members

• Ms. Pheng Sreyleak ID: 37802

• Ms. Pen Kanika ID: 74801

• Mr. Roeun Nakry ID: 41669

• Ms. Rort Pisey ID: 49096

• Ms. Ken Vannary ID: 27149

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Contents

I. Introduction

II. Objectives

III. Long-Term Objectives

IV. Types of Strategies

1. Vertical Integration Strategies

2. Intensives Strategies

3. Diversification Strategies

4. Defensive Strategies

V. Conclusion

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I. Introduction• This unit brings strategic management to life with

many contemporary examples. Sixteen types of strategies are defined and exemplified, including Michael Porter’s generic strategies: cost leadership, differentiation, and focus. Guidelines are presented for determining when it is most appropriate to pursue different types of strategies. An overview of strategic management in nonprofit organizations, governmental agencies, and small firms is provided.

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II. ObjectivesThis chapter is objected as below:

1. Discuss the value of establishing long-term objectives2. Identify sixteen types of business strategies3. Identify numerous examples of organizations pursuing different types of strategies4. Discuss guidelines when particular strategies are most appropriate to pursue

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III. Long-Term Objectives

• Long-term objectives represent the results expected from pursuing certain strategies. Strategies represent the actions to be taken to accomplish long-term objectives. The time frame for objectives and strategies should be consistent, usually from two to five years.

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IV. Types of Strategies

7Vertical Integration Strategies

Horizontal Integration

Backward Integration

Forward Integration

1. Vertical Integration Strategies

• Forward Integration: Gaining ownership or increased control over distributors or retailers.

• Backward Integration: Seeking ownership or increased control of a firm’s suppliers.

• Horizontal Integration: Seeking ownership of or increased control over a firm’s competitors.

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IV. Types of Strategies

Intensives Strategies

Market Developmen

t

Market Penetration

Product Development

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2. Intensives Strategies• Market Penetration: Seeking increased market share

for present products or services in present markets through greater marketing efforts.

• Market Development: Introducing present products or services into new geographic areas.

• Product Development: Seeking increased sales by improving present products or services or developing new ones

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IV. Types of Strategies

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Diversification Strategies

Concentric

Horizontal

Conglomerate

3. Diversification Strategies

• Concentric Diversification: Adding new, but related, products or services.

• Horizontal Diversification: Adding new, unrelated products or services for present customers.

• Conglomerate Diversification: Adding new, unrelated products or services.

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4. Defensive Strategies• Retrenchment:

Regrouping through cost and asset reduction to reverse declining sales and profit.

• Divestiture: Selling a division or part of an organization.

• Liquidation: Selling all of a company’s assets, in parts, for their tangible worth.

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V. Conclusion

Successful business requires effective business strategies.

Different business with different situations pursue different

business strategies and capitalize different benefit.

Therefore, it is important to understand individual business

preference and market situation in order to deploy effective

and right business strategies.14

Thank YouQ & A

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