The Difference Between a Corporate Strategy and a Functional Strategy

question 61

Multiple Choice

The difference between a corporate strategy and a functional strategy is that:

• A) the former focuses on how a strategic business unit will compete in its product domain and the latter sets long-term direction for the total enterprise.
• B) the former sets long-term direction for the total enterprise and the latter guides activities within one specific area of operations.
• C) the former is concerned with formulating and implementing strategies while the latter is involved in crafting strategies to guide the allocation of resources.
• D) the former adopts standardized products and advertising for use worldwide and the latter seeks efficiencies of global operations with attention to local markets.
• E) the former makes decisions regarding facilities locations, and new technologies and the latter customizes products and advertising to best fit local needs.

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Definitions:

Desired Profit

The target profit a company sets to achieve in a specific period.

Cost Concept

A concept of accounting that determines the amount initially entered into the accounting records for purchases.

Cost-Plus Approach

A pricing strategy where the selling price is determined by adding a specific markup to a product's cost price.

Product Pricing

The process of determining the cost at which a product will be sold, taking into account factors like production costs, market demand, and competition.