What is Strategy, Corporate, Team, Business & Operational Level Strategies

Tue, 07/01/2014 - 03:10 -- Gulzar Ahmed

If you are an employee of a company or a business student you definitely heard the term "business strategy" used in the daily business communication or in business books. But what is business strategy, exactly? And as a business student or a company employee are you aware that a company needs different types of strategy at different levels of the business cycle.

In this article, I would share with you some common definitions of business strategy. I shall focus on four strategic levels i.e. corporate strategy, business unit strategy, team strategy and operational strategy. I’ll also mention some of the core tools and models associated with each area.

Defining Strategy

Kevan Scholes and Gerry Johnson, authors of "Exploring Corporate Strategy," say that business strategy determines the direction and scope of a company over the long term, and they further added that it should determine how human & financial resources should be configured to meet the needs of markets and stakeholders.

Best strategy expert and professor at Harvard Business School Michael Porter, emphasize the need for business strategy to define and communicate a company’s unique position, and he says that it is the business strategy which determine how company human and financial resources, skills, and competencies should be combined to create competitive advantage.

Strategies exist at several levels in a company, ranging from the overall business strategy to individuals working in it. Each level has a different focus, and needs different tools and skills.  Below is the detail of each level of strategy.

Different Levels of Strategies

Corporate Strategy

Corporate strategy is deal with the overall purpose and scope of the business by which company meet stakeholder expectations. This is a crucial level as it is heavily influenced by the people who are the investors in the business and acts to guide strategic decision-making throughout the business. Simply, corporate strategy focuses on the organization as a whole and often stated explicitly in a "mission statement".

Business Unit Strategy

This strategy is concerned more with how a business competes (get competitive advantage) successfully in a particular market. Business unit strategy basically focuses on an individual business unit or market. It concerns strategic decisions by senior management about choice of products, customer satisfaction, gaining competitive advantage, finding new opportunities etc.

Team Strategy

For successful execution of your corporate and business unit strategies, you need teams throughout your organization to work together for accomplishment of both business & corporate strategies. Each of these teams has a different contribution in corporate or business strategies, its mean that each team needs to have its own team-level strategy. Team strategy identifies how a team will help the organization to meet its overall strategic goals and objectives.

Operational Strategy

It is concerned with how each part of the business is organized to deliver the corporate and business-unit level strategic direction. Therefore, operational strategy focuses on issues of processes, human & financial resources etc.

Pulling it all together, planning for success in the marketplace is very important for every organization. So for the purpose of taking full advantage of the opportunities in a market or environment organizations always need to anticipate and prepare strategies for the future at all levels.