BUAD441 Lecture Notes - Lecture 8: Resource Allocation, Profit Margin, Value Chain

• School: University of Delaware
• Department: Business Administration
• Course: BUAD441
• Professor: Sharon Watson

Document Summary

Corporate strategy: is this the right set of business for us to be in, which are the best to invest in/divest, what resources do we need. Ge has businesses in many things and compete among many other competitors. No common linkage sought among firm"s businesses. Corporate strategy: acquire businesses that will generate profit. Acquire, restructure, keep, sell-off for a profit. Conglomerate set of unrelated businesses: advantages. Can invest capital in industries with best profit: disadvantages. Performance tends to be no better than sum of individual businesses. Stability over businesses is not always realized. Tool for evaluating the set of businesses in a company"s portfolio. 9 cell industry attractiveness matrix - in textbook. Synergy shared thru cost-sharing: market-related opportunities. Shared corporate infrastructure: legal, hr, accounting & finance. Transfer of knowledge/skills across business: quality/production methods, low costs methods, corporate culture/employment mgmt, gov regulations, knowledge of a foreign culture, marketing concepts & ideas.