Alternative for Corporative Strategy
Following strategies can be applied for BMW as alternatives. * Growth Strategy * For the organizational growth. * Stable strategy * Keep the same strategy which could apply for stable environment * Defensive Strategy * When organization face problems, then can apply defensive strategies like retrenchment, divestiture or liquidation.
But when we consider about expecting 40% growth in automobile category, BMW should follow the Growth Strategy
Growth Strategy can be found in following subsets, * Integration Strategies (Horizontal) * To apply when market growth should be high * Should have sufficient resources * Intensive Strategies * Market Penetration * Market Development * Product Development * Diversification Strategies * Related * Non related * This should be applied when organization competes in a no growth or a slow growth industry * Also it generally needs strong management team
When identify these above strategies, next step is to do a critical factor evaluation. This is basically categorized to Cost, Benefit and Risk. Also weight can be given to each category. Criteria | Weight | Cost | 30% | Benefit | 50% | Risk | 20% |
Benefit gained by BMW is considered as more weighted.
When assign scores to each criteria following assumptions are made. Scores are between 0 to 10. High costs indicate by low score. High Benefit indicates by high score. High Risk indicates by low score. Finally high weighted score indicates the best alternative.
Following assumed figures can be obtained by when applying the scores to each criterion.
Integrative Strategy Criteria | Weight | Score | Weighted Score | Cost | 0.3 | 2 | 0.6 | Benefit | 0.5 | 7 | 3.5 | Risk | 0.2 | 3 | 0.6 | Total | 4.7 |
If