Developing Tools for Making Good Corporate Strategy Decisions

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Developing Tools for Making Good Corporate Strategy Decisions

Of the many decisions a firm has to make, the corporate strategy decisions are among the most consequential. In the University of London’s Corporate Strategy course, you’ll learn about corporate strategy, diversification, and divestitures from Bart Vanneste, an Associate Professor at the UCL School of Management and co-author of Corporate Strategy: Tools for Analysis and Decision-Making.

In a world of high complexity and uncertainty, Professor Bart Vanneste explains how the course will give you a structured approach for making good corporate strategy decisions.

Who is this course for?

The course is designed for a broad audience, whether you’re dreaming of becoming the next Warren Buffett or simply want to make better, more informed corporate strategy decisions.

Corporate strategy is the strategy a firm uses to compete across multiple businesses, so the course will be especially relevant for those working in multi-business firms, those working in single business firms that want to expand into a new business, those considering a consultancy career, or anyone interested in understanding how a firm competes across multiple businesses.

How should I think about corporate strategy?

My aim is to help you think about corporate strategy in a structured way. Corporate strategy is enormously complex. We tackle this complexity by breaking it down into smaller decisions – into something we can manage – and then by understanding how these different decisions fit together. It’s about giving you the confidence and a roadmap for the next steps to take.

Is there a particular philosophical approach, or is it more a case of arming yourself with the right decision-making tools?

The first point to make is that it’s decision-based. It’s not about theory, it’s about analyzing corporate strategy as a collection of decisions that managers need to take. The second point is that it is applicable. It’s designed to give learners a structured approach so that they can find a solution that works for them in their own context.

A key insight is that corporate strategies are dependent on the context. If the context changes, then the corporate strategy must change. For example, synergies between your businesses may strengthen or weaken, activist investors may take a stake in your firm, or your firm may become more skilled in alliances. All have consequences for your corporate strategy.

What are some of the tools that I will gain in terms of strategic decision making?

We look at a different tool over each of the four weeks of the course. In week 1, for example, we look at the sum-of-the-parts analysis, which is a tool for valuing a portfolio of businesses. Let’s say you want to value your portfolio of 10 businesses – you would then compare each of those businesses with another, standalone, business. So you have an integrated set of 10, and each of these components you then compare with a different standalone firm. Ultimately what you want to do is create more value by combining them into one portfolio, rather than having 10 separate businesses.

In weeks 2 to 4 we look at different decision making approaches to diversification, divestiture and investment respectively.

What are some of the real-world examples that you draw on to illustrate your points?

There is an international cohort of learners on the course – from China, India, the US, Brazil, Nigeria, the UK and elsewhere – so we look at examples from across the globe, from LVMH and Fosun to Ferrari and eBay. We look at companies such as Samsung, which is active in multiple businesses – medical equipment, cell phones, cranes used for heavy industry – and examine why it makes sense for this company to have such a portfolio. Similarly, we look at IKEA’s entry into the hotel business – not only why they are doing it, but how they are doing it.

Enroll for University of London’s Corporate Strategy course.

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