TYPOLOGY OF ALTERNATIVE STRATEGIES

Strategic Alternatives Types in 

Strategic Planning

STRATEGIC ALTERNATIVES

• developed to sets direction in which human and material resources of a business will be applied for greater chance of achieving selected goals.
• Strategy is a comprehensive concept and, for this reason, it is often used in different ways.
• But this difference creates a major problem when focus on 
• both the end points (mission, goals, objectives) and the means of achieving them (policies and plans).

Strategy, refers to the...

Determination of the purpose or mission and the basic long-term objectives of an enterprise, and the adoption of courses of action and allocation of resources necessary to achieve these aims.

Therefore,

Policies are general statements which guide managers’ thinking to take decision. They provide a broad boundary within which decisions should fall.

Therefore the essence of policy is discretion. 

Strategy,

However,

concerns the direction in which human and material resources will be applied with a view to increasing the chance of achieving selected objectives.

The key function of strategies and policies is to 
unify and give direction to plans. 
But if one of them stands alone, 
can hardly ensure that an organization will reach its goal.

Apparently strategic planning seems to be a simple exercise of analyses the current and expected future situation, decides the direction of the firm, and develops means for achieving the goal.

In reality,

Strategic Planning is a very complicated process that demands a systematic approach to identify and analyze factors external to the organization and matching them with the firm’s capabilities.

Features of Strategic Plans

The following are some of the most important characteristics of strategic plans:

1. They are long-term in nature and place an organization within its external environment.
2. They are comprehensive and cover wide range of organization activities.
3. They integrate guide and control organizational activities for the immediate and long-range future.
4. They set the boundaries for managerial decision making.

Types of Strategic Alternatives

Most businesses today also develop strategies at two distinct levels. 
The two general levels are;

1. Business-level strategy

It is the set of strategic alternatives from which an organization chooses as it conducts business in a particular industry or market.

Such alternatives help the organization to focus its efforts for each industry or market in a targeted fashion.

2. Corporate-level strategy

It is the set of strategic alternatives from which an organization chooses as it manages its operations simultaneously across several industries and several markets.

Companies today compete in a variety of industries and markets.

So, as they develop business-level strategies for each industry or market, they also develop an overall strategy that helps define the mix of industries and markets that are of interest to the firm.

These levels provide businesses a rich combination of strategic alternatives.