Corporate Strategies Vertical Integration Verizon implements a value chain analysis to understand the parts of the daily operations that create value, and those parts that do not. The value chain analysis is used to determine the level of competition, the type of products and services the consumer needs, and to figure out the ways that Verizon can stay sustainable and remain the market leader in the industry. This is vital because if done correctly Verizon will be able to gain high returns within the telecommunications industry by creating greater value to the customer. Verizon breaks their value chain into primary and support activities. The primary activities are research and development, infrastructure, marketing and sales, and customer
What was horizontal Integration? Answer: Horizontal integration is more dependant on various companies to get the job done. When a product is made, many companies do their part and work together to create a project. This way, each of the companies are dependant on each other and will thrive together because they are each making profit. What was mass production?
International Expansion: Davis Case Study The natural course of life for business is to grow. A company wants to grow to increase profits, to increase customer base, to increase its value, to innovate, to enter new markets, to build new product base, etc. The key is to develop, plan and execute a strong growth strategy. The strategy should outline what business or market to expand to, when to expand and how to expand. There are two ways in which a company can expand: Organically and inorganically (Growing a company by international acquisition, 2008).
For this to happen, both businesses should be operating in the same business arena (Davis, 2008). For Davis, this horizontal growth happened by pairing their existing textile maintenance company, Sunlight, with the newly acquired Berendsen, a textile service company (Davis, 2008). This gives benefits to the overall business by providing a larger customer base and enabling economies of scale and sharing sharing costs, thus making the business more profitable (Davis, 2008). For European Union (EU) markets, horizontal growth is made more simple by having a shared main language (English), shared currency (Euro), cultural similarities, and legal similarities (international standards) (Davis, 2008). All of these
This kind of expansion would be organic growth. Inorganic growth happens when a company management decides to merge or acquire a company. The difference between merge and takeover is substantial. Takeover means the company would buy 51% of the shares and would become the legal owner of the acquired company. Merger is more a mutual agreement to share resources and knowledge to increase profit of all parties.
1. Describe two major ways in which a company can grow. Give examples to illustrate the two ways of growing. The two major ways in which a company can grow are:- • Organic growth • Inorganic growth Organic growth: In business, Organic Growth can be referred to expanding the business of a company via utilizing its owns assets and resources. Organic growth for an existing business is consist of enhancing new customers and new sales in order to increase profit.
Valentin (2001) said that the SWOT analysis is the conventional approach of searching for insights into ways of realizing the desired alignment. The SWOT analysis is no doubt a valuable tool in the field of business strategy because it invites decision makers to consider important aspects of their organization’s environment and helps them organize their thoughts. However, Panagiotou (2003) argued that the open nature and unstructured method of SWOT offer little help to users and planners are left without indication as to where to search for such variables, or what to do after finding them in terms of how best to incorporate them in strategy formulation. SWOT on the other hand is an analytical framework that can help your company face its greatest challenges and find its most promising new markets (Irwin¸ 1969). Albert Humphrey (1960) as founder of SWOT matrix model describe that SWOT analysis is aiming to identify the key internal and external factors that are important in achieving the objective.
It can be used efficiently for business and strategic planning, market planning, business, product development and research reports. 2. It ensures the company’s performance that is positively associated with factors that are effecting business environment. 3. It is useful when a company wants to enter into new markets and new countries.
(Johnson et al. 1989 as cited Lee, J al et. 2007)". "The merit of SWOT as the leading tool for strategic analysis lies in its simplicity and clarity: scrutiny of internal strengths and weaknesses is followed by analysis of external opportunities and threats, enabling the company’s management to seek markets. Business opportunities create value and identify potential events that threaten its value or position.