growth strategies and crisis of business growth
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GROWTH Strategies and Crisis of Business GrowthTRANSCRIPT
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GROWTH STRATEGIES and Crisis In Business Growth
Presented by: Sahana
Archana Gitanjali
Prithwiraj
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Strategy Strategy means a deliberate and well-planned course of
action designed to achieve specific objectives. Growth strategy Growth strategy may be defined as a strategic plan
formulated and implemented to expand the operations of biz firm.
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TYPES OF GROWTH STRATEGIES Competitive Advantage – something which gives
the organisation some advantage over its rivals Cost advantage – A strategy to seek out and
secure a cost advantage of some kind - lower average costs, lower labour costs, etc.
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Market Dominance: Achieved through:
Internal growth i.e. Through Expansion and diversification Acquisitions – mergers and takeovers A merger means combination of two or more firms into one. It may occur
in two ways: (a) Merger by Absorption, and (b) Amalgamation The merger may result in: Horizontal Integration. Vertical Integration. Concentric. Conglomerate.
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Internal business level strategies – Downsizing – selling off unwanted parts of the
business – similar to contraction
Delayering – flattening the management structure, removing bureaucracy, speed up decision making
Restructuring – complete re-think of the way the business is organised
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New product development: to keep ahead of rivals and set the pace. Developing new or modified products for sale in the existing market
Contraction/Expansion – focus on what you are good at (core competencies) or seek to expand into a range of markets?
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Price Leadership – through dominating the industry – others follow your price lead
Global – seeking to expand global operations
Reengineering – thinking outside the box – looking at news ways of doing things to leverage the organisation’s performance
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SUB-CONTRACTING Sub- Contracting implies hiring another firm to
perform some of the manufacturing process or to give sub-assemblies that will be included in the finished product.
Sub-Contracting helps the firm to concentrate on it’s core biz area and thus it can grow.
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Overall Growth Strategies Summarization
Alternatives for Growth
Expansionof existingBusinesses
Diversificationinto new Businesses
Market PenetrationMarket DevelopmentProduct Development
VerticalIntegration -Forward & Backward
Related
Unrelated
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Crisis of Business Growth
Business Growth
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Financing Growth
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Financing GrowthCrisis To grow a firm needs to be able to expand – plant,
equipment, buildings, human resources, etc. To do this it needs to acquire finance Crisis may arise if it fails to generate the required
finance needed to do the business.
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External Growth
Difference in work ethics and culture may result takeovers, mergers and buyouts not to work correctly resulting in a crisis.
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Managing Growth
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Managing Growth
Businesses are human organisations – humans are difficult to manage!
Larger organisations may suffer from diseconomies of scale
Larger organisations may necessitate changing roles for the managers/leader/owners
There may be a divorce between ownership (the shareholders) and control (the Board)
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Thank You