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FUNCTIONAL STRATEGIES Tavleen Susan Korah S4 MBA
DefinitionFunctional strategy is the approach a functional area takes to achieve corporate and business unit objectives and strategies by maximizing resource productivity.
Key elements of functional strategies• Core competencySomething that a corporation can doexceedingly well-a key strength.• Distinctive competenciesWhen core competencies or core capabilities aresuperior to those of the competition.
Functional strategies objectives• Profitability- producing at a net profit in business.• Market share- gaining and holding a specific share of a product market.• Human talent- recruiting and maintaining a high- quality workforce.• Financial health- acquiring financial capital and earning positive returns.• Cost efficiency- using resources well to operate at low cost.• Product quality- producing high-quality goods or services.• Innovation- developing new products and /or processes.• Social responsibility- making a positive contribution to society.
Types of functional strategies• Marketing strategy• R&D strategy• HRM strategy• Financial strategy• Information management strategy
Marketing Strategy• Marketing strategy deals with Pricing, selling and distributing a Product.• Here the companies use 2 types of strategies: *Market Development. *Product Development.In Market Development a Company or a BusinessUnit:Capture larger market share of an existing market-Market saturation and Market Penetration. Develop new markets for current products
Research and Development Strategy• R & D strategy deals with 2 very important things:• Product Innovation• Process Improvement It also deals with the questions like, - how newtechnology should be assessed? -internaldevelopment -external acquisition etc.
HRM Strategy• HRM strategies are an organization’s palns for managing people, culture, structure and training and development and for determining how people fit into an organization’s future growth.• Some companies divide the strategies into 4 major areas; culture, people, organization and human resource systems.
Financial Strategy• It focuses on the alignment of financial management within an organization with its business and corporate strategies to gain strategic advantage.
Information Management Strategy• It focuses on the alignment of information management within an organisation with its business and corporate strategies to gain strategic advantage.