CORPORATE STRATEGY

Corporate Strategy is concerned with how companies, like Disney, create value across different
businesses. It takes as given the RC lessons on competitive strategy, and asks how the
corporation can add value over and above that which a business unit creates by itself. This
requires the corporation to invest in a valuable set of resources, craft the business portfolio, and
design the organization structure, systems and corporate functions to share activities or transfer
skills across businesses.

The corollary of effective corporate strategy is that there is a limit to the scope of the firm. This
insight suggests that issues of corporate strategy apply to firms of every size and in every sector.
Should a start-up build its own salesforce or rely on third party distributors? Should an
entrepreneur focus on a single niche or expand scope to serve many verticals? Thus while the
course naturally covers strategy in large diversified companies, it also features smaller
companies that appear to operate in a single business.

Modules and topics covered in the course include:

RESOURCES and CORPORATE STRATEGIES:

Building on the RC module on Corporate Strategy, the course identifies valuable resources
(popularly, but incorrectly, termed core competences) that can function as the "Mickey Mouse"
that adds value to the corporate portfolio. By studying different strategies at firms like Danaher
and Clorox, it introduces a continuum, ranging from conglomerates and private equity firms to
tightly related corporate entities and startups, and demonstrates that the same logic of "better off"
and "ownership" tests applies to every effective corporate strategy. This logic can be captured in
a company's statement of its objective, scope and corporate advantage.

ORGANISATION and THE ROLE OF CORPORATE HEADQUARTERS:

To justify ownership of any business a corporation must have the appropriate structures, systems,
and policies to actually realize value. This module therefore examines these design choices,
focusing on the size and roles of corporate headquarters in shaping and controlling business unit
strategy and performance, building centres of competence, and sharing activities. It covers
specific tools available to CHQ to extend their influence on the organization, including
processes, delegation of authority, use of technology and governance. This module also
examines approaches to resource allocation and the choice between internal development of new
businesses and corporate M&A. It includes detailed examples of M&A synergies with Cadbury's
acquisition of Adams gum, and ecosystem innovation in pharmaceutical and technology firms.

BUSINESSES and PORTFOLIO TRANSFORMATION:

Defining the boundaries of the firm - the limit to its scope - is critical to crafting the corporate
portfolio. At the extreme this determines which businesses to enter and exit, and the extent of
vertical integration in the firm. More generally this requires developing a portfolio that is robust
to changes in the external environment. This module delves into scope choices in a wide variety
of settings, from large and global organizations to start-ups, from wine producers to media and
technology. The module concludes with a series of case on corporate transformation,
highlighting the challenge of realigning resources, organizational structure and scope to face a
constantly evolving competitive landscape.

The perspective adopted throughout the course is that of the CEO of the corporation and the
pragmatic challenges top managers face in managing a multi-business entity. Thus the course
should appeal to anyone interested in managing, financing, advising, or investing in a company
that operates in multiple, businesses, geographies, or activities.