Questions and Answers – chapter 5
1. Drawing upon the case, identify the levels of strategy at Wesfarmers.
Due to the conglomerate structure of Wesfarmers, it has a wide range of products, therefore each division has a different strategy.
They will use both corporate- and business-level strategies. The top management has to decide where to spend what amount of money. For their divisions though, Wesfarmers is going to use business-level strategies. Furthermore, some of these divisions could apply the cost-leadership strategy.
Corporate level strategy, each division has his own strategy. But will use bussines level strategy in this division
2. Using Miles and Snow's terminology, how would you classify Wesfarmers? How would you classify the main operating divisions? Is it possible for the organisation as a whole and the main operating divisions to be different strategic types? If you answered yes, discuss what challenge this presents for Miles and Snow's theory.
We do not think that we can classify Wesfarmers’s strategy as a single type. It has both the aspects of an analyser – because it avoids excessive risks and a prospector – because it seeks to develop new products and services but also definitely the aspects of a defender – due to its maturity.
The main operating divisions are one managing and six operating divisions. We believe that it is possible for the organisation and the main operating divisions to be of different strategic types.
They analyse other companies and then decide if they take this one over or not.
Defenders because they mostly move in the same market.
Prospectors in Australia should be innovative. -> would be if they took more risk.
So do not search for new products in the same market
The main organisation has different goals from the divisions
3. Barlett and Ghoshal proposed four strategic types of multinational. Wesfarmers operates mainly in Australia with small operation in New Zealand. Does its...