Abstract
In Part I of this text we examined the sequence in which firms make strategic decisions. In Part II we shall examine a range of individual business strategies that are used to achieve corporate objectives. The first of these individual strategies to be examined is growth. This has been chosen because growth embraces most of the major directions of strategic decision-making. Indeed, only divestment as a business strategy falls out with the ambit of growth, and even in that case individual divestments by a firm may simply be a prelude to a new phase of growth.
Nothing is so compelling as the need to survive. However, there is little doubt as to how, overwhelmingly, this choice is exercised: it is to achieve the greatest possible rate of corporate growth as measured in sales. — J. K. Galbraith, The New Industrial State (London: Hamish Hamilton, 1967) p. 171.
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References
See, for example, G. Meeks and G. Whittington, ‘Directors’ Pay, Growth and Profitability’, Journal of Industrial Economics, September 1975, Vol. XXIV, pp. 1–14.
R. Marris, The Economic Theory of ‘Managerial’ Capitalism (London: Macmillan, 1964) p. 58.
See G. Johnson and K. Scholes, Exploring Corporate Strategy (New Jersey: Prentice-Hall International, 1984) p. 151.
See Interim Report of the (Wilson) Committee to Review the Functioning of Financial Institutions (London: HMSO, 1979, Cmnd 7503) Ch. 9.
See Financial Times, 9 February 1984.
See J. Thackray, ‘The Year of W. R. Grace’, Management Today, January 1975, p. 72.
See, for example, London Brick Company’s approach to valuing its reserves of Oxford clay in Financial Times, 10 February 1984.
See E. T. Penrose, The Theory of the Growth of the Firm (Oxford: Blackwell, 1980 edn) Ch. 4.
Ibid., p. 47.
See the evidence on this quoted in W. S. Howe, Industrial Economics (London: Macmillan, 1978) pp. 87–8.
R. L. Marris, ‘Incomes Policy and the Rate of Profit in Industry’, Manchester Statistical Society, December 1964, pp. 23–8.
See Marris, The Economic Theory of ‘Managerial’ Capitalism, pp. 250–3.
See T. J. Peters and R. H. Waterman, In Search of Excellence (New York: Harper & Row, 1982) pp. 296–7.
See Penrose, The Theory of the Growth of the Firm, Ch. 7.
See S. Caulkin, ‘The Unlimited Explosion’, Management Today, February 1984, pp. 42–4.
See R. G. Hamermesh and S. B. Silk, ‘How to Compete in Stagnant Industries’, Harvard Business Review, September–October 1979, pp. 161–8.
See W. S. Howe, ‘Competition and Performance in Food Manufacturing’, in J. Burns et al. (eds), The Food Industry (London: Heinemann, 1983) pp. 101–26.
See Sunday Times, 19 February 1984.
See W. K. Hall, ‘Survival Strategies in a Hostile Environment’, Harvard Business Review, September–October 1980, pp. 75–85.
See R. Biggadike, ‘The Risky Business of Diversification’, Harvard Business Review, May–June 1979, pp. 103–11; and for some rather more optimistic UK evidence C. W. L. Hill, ‘Conglomerate Performance Over the Economic Cycle’, Journal of Industrial Economics, December 1983, Vol. XXXII, pp. 197–211.
See Monopolies Commission, British Match Corporation Ltd and Wilkinson Sword Ltd (London: HMSO, 1973, Cmnd 5442); and S. Caulkin, Wilkinson’s Second Safety Match’, Management Today, September 1983, pp. 50ff.
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© 1986 W. Stewart Howe
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Howe, W.S. (1986). Business Growth. In: Corporate Strategy. Palgrave, London. https://doi.org/10.1007/978-1-349-18213-8_7
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DOI: https://doi.org/10.1007/978-1-349-18213-8_7
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