Your Corporate Strategies Portfolio

Your corporate strategy (or, more precisely, your general or ‘umbrella’ corporate strategy) is essentially a broad and general plan for implementing your corporate vision – building the company that you described in your corporate vision statement. In your corporate strategy statement you are essentially saying in broad and general terms: “This is how we are going to implement our corporate vision”.

Usually, the business entity needs not one, but several corporate strategies (‘level 1 strategies’) each detailing a specific functional area of your company. Marketing strategy, financial strategy, operational strategy, risk management strategy, information and knowledge management strategy and human capital management strategy.  

Thus, your marketing strategy is a broad and general plan for implementing your corporate vision in your ‘marketing mix’ – product/price/place/promotion. It essentially says ‘this is how we are going to do our marketing’.

Due to inherent complexity of a corporate marketing function, a marketing strategy is usually itself a portfolio of strategies (‘level 2 strategies’): UVP development strategy, brand management strategy, products & services management strategy and your communications strategy. Your marketing strategy also covers your target markets, competition, core competencies and competitive advantages.

 

Your financial strategy (or, more precisely, your financial management strategy) basically states – in broad and general terms - ‘this is how we are going to manage our corporate finances’. It covers sources of financing for general corporate operations, acceptable levels of leverage and other financial risks, corporate capital structure, dividend payments, corporate credit terms, asset and liability management and other corporate finance issues. Due to inherent complexity of corporate finance, your financial strategy statement can be quite intricate as well.

In the corporate cockpit methodology, your accounting function is covered by your information and knowledge management strategy, because accounting is all about data, information and knowledge.

Your operational strategy statement essentially declares: ‘this is how we are going to conduct our corporate operations’. It is mostly concerned with managing your corporate processes and with operational management of your corporate projects and your operational assets – such as your manufacturing equipment and/or operational real estate (the proverbial ‘property, plant and equipment’ on your balance sheet).

Operational strategy also covers your logistics and the operational side of your distribution system (financial is covered by financial strategy; sales & marketing – by the marketing one). It also deals with designing and restructuring your corporate organization structure – business- and functional units, regional branches and the like.

Your corporate risk management strategy basically states (in broad and general terms): ‘this is how we are going to manage our corporate risks’. You can find a detailed description of corporate risk management system in the appropriate section of this guide.

Your information management strategy (more correctly, your data, information and knowledge management strategy) effectively declares – again in broad and general terms – ‘this is how we will manage our data, information and knowledge’.

This strategy covers all aspects of your corporate knowledge management system (KMS) - your corporate knowledge base (the core and foundation for your KMS); your hardware and software and your KMS users (specifically, their knowledge management needs).

The tricky component is your corporate Intranet – your internal computer network that uses Internet protocols (TCP/IP, HTML and the like) to share (disseminate) knowledge, coordinate activities and interact in general within your organization.

The trick is that the Intranet is at the same an information management system, a corporate communications tool and a personnel management tool. Thus, it is inevitably mentioned in all three strategies – your corporate communications strategy, your personnel management strategy and your information management strategy. In practice, it requires that you develop and implement a separate Intranet management strategy.

Your human capital management strategy announces in broad and general terms ‘this is how we are going to manage our human capital’. By the way, it is always much better to use ‘human capital’ instead of ‘personnel’, ‘employees’ or ‘workforce’. Or even ‘human resources’ (especially ‘human resources’).

Why? Because it is simply more accurate and meaningful term. Your employees make decisions and perform actions that create shareholders value (and other components of aggregate value) and thus are, indeed, your corporate capital.

This strategy covers all aspects of hiring and firing, motivation, training, career development, promotion and other aspects of human capital management. It also covers your corporate culture, your corporate code of conduct and the human capital management aspect of your corporate Intranet.