Strategy Formulation and Ethical and Legal issues

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The response addresses the queries posted in 1455 words with references.

//Corporate strategy is a part of the business administration. In the business, the formulation of the strategies and potential strategic alternatives is a critical process. In the first section of the discussion paper, the introduction of the 'Corporate Strategies' is given in detail.//

Corporate Strategy

Corporate strategy ensures growth of the organization and ensures the correct alignment of the organization with its environment. It serves as a design to fill the strategic planning gap and also helps to build competitive advantage for a company. A Corporate Strategy:

? Gives a long term direction to the organization;

? Has a big effect on the resources of the company; and

? Helps to achieve the competitive advantage for the company.

While formulating a strategy, the firm looks at the opportunity-threat profile of the company obtained through the appraisal of the external environment, and its own strengths and weaknesses, competitive advantage and the resources derived from an internal scanning of the environment. Then, the firm weighs the advantages and disadvantages of the different strategy options and makes the final choice of the strategy.

//After having a good understanding of the corporate strategies; in the next section of the discussion paper, some of the effective strategic alternatives present in the business, are given as under. The alternatives are stability, expansion and divestment strategy. The detailed description of these alternatives is given in the further paragraphs.//

Strategy Alternatives

In different situations, a firm can adopt different strategies. These strategies can be classified into four categories including the

Stability;

Expansion;

Divestment; and

Combination (Ramaswamy & Namakumari, 2005)

Stability strategy basically means staying with the same business/product markets and functions as at present and maintaining the same level of effort as at present. When a firm wants to enhance its functional efficiencies in an incremental manner with the help of better deployment and use of resources, it should adopt the strategy alternative of stability. The desired income or profits would be forthcoming through such incremental improvements in functional efficiencies. In a situation when the ...