PURPOSE:

In a VUCA world (Volatile, Uncertain, Complex, Ambiguous) far more value is created by companies, like Amazon, Meta and Alphabet that develop entirely novel business models, than by entrenched incumbents, such as P&G or Ford, which struggle to eke out market share gains. However, many of the most valuable new ventures, like Tesla and Netflix, are also among the most shorted stocks as investors struggle to see their long term potential.

To understand why and how this might occur, the overarching framework applied throughout this course covers “The Complete Strategy Landscape”[1]. This illustrates that companies must not just be concerned with the value captured by the one-time formulation of a beautifully aligned competitive strategy, which was the focus of the RC Strategy course, but by the value potential of their business model, and with its value realization through effective implementation over time.

Within this landscape, the Corporate Strategy course addresses three questions that challenge every modern corporation. The first, and most fundamental is, “How do companies create shareholder value across multiple markets?” in the midst of radical technological and social change. The second, whose identification won Ronald Coase the Nobel Prize in Economics[2] and which, unless we believe that one company will take over the world, is the logical corollary of the first, asks, “What is the limit to the scope of the firm?” The third question addresses the administrative issue of “How can we effectively manage a multi-business corporation?” to engender entrepreneurship and adaptability while maintaining control and realizing economies. All companies, whether large diversified multinationals or small entrepreneurial startups wrestle with these issues, and their appropriate resolution has enormous impact on performance.

The perspective adopted throughout the course is that of the CEO and the pragmatic challenges they face in crafting a strategy that successfully exploits available opportunities while confronting the realities of competition in the 21^st century. As a result, the course should be of value to anyone interested in managing, consulting to, financing, or investing in a company that operates in multiple, businesses, geographies, or activities.

The course includes many CEO case protagonists and representatives from leading consulting firms as guests to share their insights into effective modern corporate strategy. Those who attended the course previously include, among others, Daniel Loeb (Third Point), Larry Culp (GE, ex Danaher), Penny Pennington (Edward Jones), Horst Kayser (Siemens), David Roux (Silver Lake), Martin Reeves (BCG), Dunigan O’Keeffe (Bain & Co.), Robert Uhlaner (McKinsey), David Schlendorf (FBI), Dan Simpson (ex Clorox), Kevin Mayer (ex Disney and TikTok), Nils Andersen (Unilever, ex Maersk), Kevin Sharer (ex Amgen) and Irene Rosenfeld (ex Mondelez) [3].

In addition to regular case classes, each module is accompanied by a course note and a video lecture. These bed down the conceptual frameworks and provide pragmatic takeaways and current examples of the topic to study on your own time. As a tradeoff with somewhat fewer class sessions, the final assignment is a paper that asks you to apply the course frameworks to a current corporate strategy situation you find interesting.

1. BUSINESS MODELS and THE COMPLETE STRATEGY LANDSCAPE
While introducing the Complete Strategy Landscape framework, which places the RC Strategy course emphasis on strategy as “positioning” in a broader context, the module focuses on understanding how novel business models – the combination of “job to be done”, assets required to deliver that service, and monetization method – create value. We will examine WhatsApp, Walmart in its competition with Amazon, the FBI, Tesla, Komatsu’s introduction of “SmartConstruction” and Netflix, among others to understand how to evaluate the potential in new ways of doing business.
2. RESOURCES and THE CONTINUUM OF CORPORATE STRATEGIES:
Building on the RC module on Corporate Strategy, the course identifies valuable resources (popularly, but incorrectly, termed core competences) that can function as the "Mickey Mouse" that adds value to the corporate portfolio. By studying strategies at firms as different as Danaher and Clorox, it introduces a continuum, ranging from conglomerates and private equity firms to tightly related corporate entities and startups, and demonstrates that the same "better off" and "ownership" tests apply to every effective corporate strategy. This logic can be captured in a company's statement of its objective, scope and corporate advantage.
3. BUSINESSES and PORTFOLIO TRANSFORMATION:
Defining the boundaries of the firm - the limit to its scope - is critical to crafting the corporate portfolio. At the extreme this determines which businesses to enter and exit, and the extent of vertical integration and geographic expansion of the firm. More generally this requires developing a portfolio that is robust to changes in the external environment, and has to address the choice between internal development of new businesses and corporate M&A. This module delves into scope choices in a wide variety of settings, from large global organizations to start-ups.
4. ORGANISATION and THE ROLE OF CORPORATE HEADQUARTERS:
To justify ownership of any business a corporation must have the appropriate structures, systems, and policies to actually realize value. This module examines these design choices, focusing on the role of corporate headquarters in shaping and controlling business unit strategy and performance, building centres of competence, and sharing activities. It covers specific tools used by corporate executives including delegation of authority, approaches to resource allocation and corporate initiatives. The module concludes with cases on corporate transformation, highlighting the challenge of realigning resources, organizational structure and scope to face a constantly evolving competitive landscape.

[1] See D. Collis, “Wy do so Many Strategies Fail??” Harvard Business Review July/August 2021 pp 82-93.

[2] R. Coase “The Nature of the Firm,“ Economica: 1937

[3] Please note that, particularly in these times, some of the invited guests might be unable to attend class.

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