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Functional level strategy 2

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Presentation on theme: "Functional level strategy 2"— Presentation transcript:

1 Functional level strategy 2

2 What is a Functional Strategy
A functional strategy is a short term game plan for a key functional area within a company. Functional strategy must be consistent with long term objectives and the grand strategy

3 Characteristics of functional strategy
Time horizon – annual Specificity – key function - subunit Participation – functional manager

4 Functional Strategy in Marketing
The role of the marketing function is to increase sales of the product/service and thus increase revenue generation of the company Marketing managers develop marketing strategies determining who will sell what , where to whom and in what quantity

5 Functional Strategy in Marketing
Key Functional Strategy Key consideration Price Type of product Key contributor to profitability Product image Price as a basis of competition Gross profit margin

6 Functional Strategy in Marketing
Key Functional strategy Key consideration Place geographic areas Key distribution channel Sales force org Promotion Advertising and communication priorities Media

7 Functional strategy in Finance
Financial strategies direct the use of resources in supporting long term goals and objectives

8 Functional strategy in Finance
Key Functional Strategy Key consideration Capital acquisition Cost of capital Levels and form of leasing Capital allocation Priorities in allocation Capital allocation authority Dividend and WC management Dividend payout ratio Cash flow requirements

9 Functional Strategy in R&D
R&D Decision Area Key Consideration Basic research versus commercial development Extent of innovation Vis a vis product dev New projects Time horizon Emphasis on short or long term

10 Functional Strategy in R&D
R&D Decision Area Key Consideration Organization fit Nature of research Departmental structure Basic R&D Posture Offensive or Defensive


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