Video Transcript: Corporate Level Strategies
Let's take a look at corporate level strategies. To formulate effective strategies, companies must be able to answer three basic questions, what business are we in? How should we compete in this industry. Who are our competitors and how should we respond to them? Corporate level strategy is the overall organizational strategy that addresses the question, What business or businesses are we in or should we be in? One of the standard strategies for stock market investors is diversification, or owning stocks in a variety of companies in different industries. Portfolio Strategy is a corporate level strategy that minimizes risks by diversifying investment among various businesses or lines. The BCG matrix is a portfolio strategy that managers use to categorize their Corporation's business growth rate and relative market share, which helps them decide how to invest corporate funds in sum, in contrast to a single, undiversified business or unrelated diversification, related diversification reduces risk because the different businesses can work As a team, relying on each other for needed expertise, experience and support.