In this article, we will discuss the different types of strategies in marketing (strategic management). There are also tried to give some concepts about the levels of strategy making. For a better understanding, types of strategies in business (strategic management) and other related issues describe here.
Before going to the main topic, the basic concept should be cleared. For that required, there are given a fundamental discussion about the strategy. For instance,
STRATEGY, this word would use only in military administration. Strategy refers to the "deployment" of troops in their viewpoint. They've expressed the maneuvering of troops into position before the enemy is engaged. But now, this word is used in the business and management sector. The businessman can substitute "resources" for troops. And also deploy different kinds to achieve objectives.
For better clarification of the term strategy, we should distinguish among three forms of strategy: general strategy, corporate strategy, and competitive strategy. The general strategy is such a strategy as to how a given objective will be accomplished. Thus, the general strategy is concerned with the relationships between ends and means. This we seek and the resources at our disposal. Strategy and tactics, both together make a bridge the gap between ends and means. Corporate Strategy defines the markets and businesses in which a company basis on which company will compete. The success of a competitive strategy depends on the company's capabilities, strengths, and weaknesses concerning its competitors, capabilities strengths, and weakness.
Table of Contents
- 1 What Are the Types of Strategies in Marketing (Strategic Management)?
- 1.1 1. Competitive Strategy:
- 1.2 2. Corporate Strategy:
- 1.3 3. Business Strategy:
- 1.4 4. Functional Strategy:
- 1.5 5. Operating Strategy:
- 2 Business-Level Strategy:
What Are the Types of Strategies in Marketing (Strategic Management)?
If we want to mention the types of strategic management strategies, we can specify it as five types or 5 levels of strategy. It may be one kind of New Public Management (NPM)'s strategy. What are the different types of strategies in marketing (strategic management)? Such as:-
- Competitive Strategy
- Corporate Strategy
- Business Strategy
- Functional Strategy, and
- Operating Strategy
Read more: Difference Strategic Management Models.
1. Competitive Strategy:
Firstly, competitive strategy is the first of the kinds of strategies in strategic management. It refers to a plan that combines the clout of the external situation. Along with the integrative concerns of the personal status of an organization. The competitive strategy aims at gaining a competitive advantage in the marketplace against competitors. Competitive advantage comes from strategies that lead to some uniqueness in the market. Winning a competitive strategy is grounded in sustainable competitive advantage. Examples of the competitive strategy include contrast strategy, low-cost strategy, and focus or market-niche strategy.
In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. Wikipedia
The competitive strategy consists of business approaches and initiatives. It undertakes a company to attract clients and deliver. Superior values to them through fulfilling their looking forward as well as to strengthen its market position. This definition of Thompson and Strickland emphasizes the 'tactics and ingenuities' of directors in outlining the strategy. It means that competitive strategy is concerned with actions. Its managers undertake to improve the company's market position by satisfying the customers. The enlightening market situation infers undertaking actions contrary to competitors in the industry.
Therefore, the notion of competitive strategy has a competitor-angle. The competitive strategy includes those tactics that lay down various ways to build a livable, competitive advantage. Management's action plan is the focus of the competitive strategy. The objective of the competitive strategy is to win the customer's heart by satisfying their needs. Finally, it is to outcompete competitors and attain competitive advantages.
| Strategic Management Types | Meaning |
|---|---|
| Competitive Strategy | Combines the clout of the external situation, along with the integrative concerns of the personal status of an organization |
| Corporate Strategy | The top-level by the senior management of a diversified company |
| Business Strategy | Business-unit level or business-unit strategy |
| Functional Strategy | Pointing up a particular functional area of an organization |
| Operating Strategy | Operating units of an organization |
2. Corporate Strategy:
Secondly, corporate strategy is a type of strategy in strategic management. It draws up at the top level by the senior management of a diversified company. In our country, a diversified company is known as a 'group of companies, such as Bashundhara, Partex, Beximco, and Square Group. Such a strategy describes the company's overall corporate strategy. As well, corporate strategy defines the long-term objectives and generally affects all the business-nits under its umbrella. A corporate strategy (Bashundhara) may be acquiring the major tissue paper companies in Bangladesh to become the unquestionable market leader.
Components of Corporate Strategy
What are the key components of corporate strategy? Then, it is time to bring about the forenamed corporate strategy components, which are mentioned below:
- Visioning
- Objective setting
- Resource allocation
- Prioritization of strategic tradeoffs
3. Business Strategy:
Thirdly, the different types of strategies in marketing (strategic management)'s third one is a business strategy. Business strategy formulates at the business-unit level. It is popularly known as the 'business-unit strategy.' This strategy emphasizes the building up of the company's competitive position of products or services. Business strategies compos of a competitive and cooperative approach.
The business strategy consists of plans of action adopted to use a company's resources and distinctive competencies to gain competitive advantages in the market. M. A. Mannan
The business strategy covers all the activities and tactics for competing in denial of the competitors. And behavior management addresses various strategic matters. As Hill and Jones have remarked, the business strategy consists of plans of action. It's strategic managers who adapt to use a company's resources. Additionally, managers change distinctive attitudes to gain a competitive advantage over their rivals in a market. The business strategy usually formulates in line with the corporate strategy. The business strategy's main focus is product development, innovation, integration, market development, diversification, and the like.
In doing business, companies confront a lot of strategic issues. Management has to address all these issues effectively to survive in the marketplace. Business strategy deals with these issues, in addition to 'how to compete.'
Components of Business Strategy
The 7 (seven) components comprise a basic framework of business strategy. Such as:-
- Vision, mission, and values
- Long-term goals for your business strategy
- Financial objectives
- Operational objectives for your business strategy
- Market objectives or creating customer value
- SWOT Analysis
- Business strategy action plans
4. Functional Strategy:
Fourthly, the functional strategy is a type of strategy in strategic management. A functional strategy refers to an approach that points up a particular functional area of an organization. It sets down to achieve some objectives of a business unit by maximizing resource productivity. Once in a blue moon, functional strategy names departmental strategy since each business function frequently devolves with a section. Examples of functional strategy comprise production strategy, marketing strategy, human resource strategy, and financial strategy.
At the level of operating divisions and departments, functional strategies focus on business processes and value chains. J. D. Hunger & T. L. Wheelen
The functional strategy is concerned with developing the right stuff to provide a business unit with a competitive advantage. Each business unit has its own set of departments, and every department has a functional strategy. Functional strategies adapt to support a competitive strategy. For example, a company following a low-cost competitive strategy needs a production strategy. It insists on reducing cost operation and also a human resource strategy.
Furthermore, It insists on retaining the lowest possible number of employees. These employees are highly qualified to work for the organization. Other functional strategies such as marketing strategy, advertising strategy, and financial strategy must also be formulated to support the business-level competitive strategy.
The organizational plans become more and more detailed. Likewise, it becomes specific when managers move from corporate business to functional-level strategies.
5. Operating Strategy:
Finally, the operating strategy is the fifth type of strategy in strategic management. It gives form to the operating units of an organization. A company may develop an operating strategy. As an instance, for its sales zones. An operating strategy is put across at the field level, usually to achieve on-hand objectives. In some companies, managers develop an operating strategy for each set of annual goals in the divisions.
Components of Operations Strategy
Operations strategy consists of six main components or elements. Such as:-
- Designing and positioning the production system.
- Focusing production or manufacturing and service facilities.
- Designing and developing the product or service.
- Selecting the technology and process development.
- Allocating the resources.
- Planning of capacity, facility, and layout.
Read: Types of Entrepreneurship
Business-Level Strategy:
What are the main strategies in business? After a short detail of the types of strategic management strategies, here will bring up about business-level strategy. In a diversified company, strategies initiate at four levels. You can see the following table for a better understanding. For instance:-
| Levels of Organization | Name of Strategy |
|---|---|
| Corporate level | Corporate Strategy |
| Business level | Business Strategy |
| Functional level | Functional Strategy |
| Operating level | Operating Strategy |
There are three levels of the organization at the business-unit level, and obviously, three types of strategic management strategies formulate. Again it is run with the specific six processes which depend on the public administration and private administration field. For instance:-
| Levels of Organization | Name of Strategy |
|---|---|
| Business level | Business Strategy |
| Functional level | Functional Strategy |
| Operating level | Operating Strategy |
Lastly, we can say that strategic management strategies are a vital topic in business studies. This section will review the different advanced strategies and strategic management models, like Porter's Five Forces Model.
If you need more knowledge and want to enrich yourself with the topic, for example, strategic management or the different types of strategies in marketing, etc., you have to read more. There are included some popular books list which accelerates to know and given clear concepts.
| Book Name | Author | Amazon Price |
|---|---|---|
| Strategic Management | Frank Rothaermel | Check |
| Strategic Management: Concepts and Cases: Competitiveness and Globalization | Michael A. Hitt, R. Duane Ireland, and Robert E. Hoskisson | Check |
| The Reading Strategies Book: Your Everything Guide to Developing Skilled Readers | Jennifer Serravallo | Check |
