ORGANIZATIONS & COMMUNITY CORPORATE and COMMUNITY Chapter 4 Lecture 2 What is the purpose of corporations? What activities do they then pursue in communities?

ORGANIZATIONS & COMMUNITY CORPORATE and COMMUNITY COMMUNITY BEGINS WITH CORPORATIONS KNOWING THEIR PURPOSE, THEIR MISSION AND WITH PEOPLE WHO KNOW THEIR PURPOSE/MISSION IN LIFE

ORGANIZATIONS & COMMUNITY There are 5 levels of Organizational Purpose u Enterprise Strategy. Why do we exist as an organization? u Corporate Strategy. What businesses should we be in now and in the future? u Business Strategy. How shall we position ourselves in the industries and businesses where we choose to operate? u Operational Strategy. How shall we coordinate among processes, people, and structures to meet enterprise, corporate, and business level strategies? u Individual Strategy. What must each individual do daily at work to meet organizational goals consistent with other levels of strategy?

ORGANIZATIONS & COMMUNITY Compare these Statements of Enterprise Strategy u W.T. Gore and Associates: the objective of the enterprise is to make money and to have fun doing so. u Citibank (before Citigroup merger): to provide financial services every place in the world where it is legal, moral, and on which we can make a profit. u Shiseido: to be the Global No. 1 cosmetic firm as measured by the quality of its people and the evaluation others assign to all aspects of Shiseido. u Cargill: we will be the best in improving the standard of living of the 5+ billion people in the world.

ORGANIZATIONS & COMMUNITY Enterprise Strategy/Purpose u usually is articulated by top management u often is vague or abstract u can change over time, e.g., Boeing 1990 Mission: To be the number one aerospace company in the world and among the premier industrial concerns of quality, profitability, and growth Boeing Vision 2016: People working together as one global company for aerospace leadership u informs all other strategy levels

ORGANIZATIONS & COMMUNITY Corporate Level Strategy Depends on Enterprise Strategy/Purpose u Corporate strategy defines which businesses to be in now and into the future. u Corporate strategy is reflected in which businesses the organization buys, sells, acquires, develops, etc. u Corporate strategy is a view of the overall corporate portfolio of businesses.

ORGANIZATIONS & COMMUNITY Business Strategies are Industry Specific u typically focus on a) focal product or service, b) primary constituency served, c) distinctive competence or competitive advantage of the business u may be articulated for the business or for a single subunit, e.g., commercial airlines

ORGANIZATIONS & COMMUNITY Decisions About Enterprise, Corporate, Business and Operational Strategies Define u operational objectives, e.g., which people, processes, and structures are needed to satisfy these objectives

ORGANIZATIONS & COMMUNITY Decisions About Enterprise, Corporate, Business and Operational Strategies Define u individual objectives, job assignments, employee activities

ORGANIZATIONS & COMMUNITY Trace This Through One Organization u Time Warner Inc has been described as a company where “we are in the business to make money” u Acquired music and movie divisions that could make them most money u within businesses, competed with a “bare-knuckle business style” u resulting in an internal hotbed of strife and turf wars u where heads of the movie division and the music division slugged it out for control of the recorded-music business

ORGANIZATIONS & COMMUNITY Since 1997, Time Warner’s Chairman has Articulated a New Vision: u EMPHASIZING core values and guiding principles including diversity, integrity and respect u WHY? because Levin believes that only companies with clearly articulated values will prosper and survive in the increasingly hectic, complex digital age

ORGANIZATIONS & COMMUNITY Video: Making Globalization Succeed u be looking for vision/statement of values u and how these values are embedded in people, processes, and structures for Levi, Motorola, and Sony

ORGANIZATIONS & COMMUNITY Argus Computers India u As you watch this, be looking for these points: what is the founder's purpose? how are people developed? how is the organization structured?