Corporate Strategy and the Corporate Brand

Abstract

‘Strategy’ is concerned with positioning a company so that it can meet its long-term objectives. It should always be unique to an organisation and built on an analysis of competencies and market opportunities/threats. The question is: how do we define an organisation’s competencies and how do we know if they matter to stakeholders? In manufacturing, often the competencies are technological, such as Sony’s skills in miniaturisation or Bausch & Lomb’s (the makers of Ray-Ban sunglasses) optics expertise. In services the competencies are derived from corporate culture, operating systems and human resources policies. For example, the American department store group, Nordstrom, excels at service provision primarily because of its humanistic corporate culture and its emphasis on people quality. However the competency on its own can be negated if the product or service delivery is not relevant to consumer needs. Therefore although competency analysis tends to encourage companies to look inward at themselves and ask what are we good at, in reality they should think more about the customer benefits they are good at meeting. Nordstom’s service excellence would not be effective if it resulted in excessively high prices that consumers were unwilling to pay. The other key success factor is the precision with which the organisation’s competence is defined.