Difference Between Business Strategy and Corporate Strategy

In order to do well in a particular field, everyone needs a strategy to take action. When we talk about an organization or a firm, there are three main kinds of management levels present, namely corporate, functional, and business level.

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Test your knowledge about topics related to business

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Economic activities are related to ___________.

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Wages and taxes that a company pays are examples of:

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In business, stakeholders are defined as:

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Non-economic activities aim at __________.

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The management of the company is entrusted to __________.

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A person who risks both time and money to start and manage a business is called ___________.

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When at least 51% shares are in the hands of government, it is called as __________.

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Which of the following countries are part of the WTO?

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_________ deals with appointing people and placing them at the appropriate jobs.

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Membership in a Co-Operative Society is?

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Business Strategy vs Corporate Strategy

The difference between Business Strategy and Corporate Strategy is that business strategy includes decisions related to product choice, competition in the market, the satisfaction of the customer, etc.

However, corporate strategy has decisions that are more concerned with fulfilling the expectations of stakeholders. This strategy is more focused on the aim of a business.

Business Strategy vs Corporate Strategy

In business, a strategy is quite crucial when it comes to achieving an objective. It is looked like a blueprint that you have to follow in order to achieve a particular goal.

The business strategy is formed by medium-level management, whereas corporate strategy is formed by top-level management. Usually, business strategy and corporate strategy are treated as a single term by many people.

However, it is quite essential to know that they are not.


 

Comparison Table

Parameter of ComparisonBusiness StrategyCorporate Strategy
MeaningThis strategy is concerned with ameliorating the overall performance of the organization by helping it to achieve specific goals.A corporate strategy helps a business to operate the whole organization. This strategy focuses on stakeholders meeting their requirements.
Formed byMiddle level managementTop level management
Copes withBusiness strategy copes with a particular unit or division of a business.Corporate strategy deals with the operations of the whole business organization.
DurationIt is a short term strategy.It’s a long term strategy with an ultimate goal for the business.
AimIt is focused on competing with the other products in the market.It is responsible for elevating profits and making the company grow faster.

 

What is Business Strategy?

Business strategy is nothing but a master plan that is designed to help a company reach specific goals. Having a solid business strategy informs and allures investors.

This also makes sure that they end up investing in your firm due to a sense of security.

The credibility of the firm also gets assured to the creditors by having a business strategy. Business strategy acts as a blueprint for the company in order to achieve their goals.

There could be no chance of error in a business strategy as it might harm your company in this competitive market.

Everyone, who is new to the business, should set their goals upfront. After setting up the goals, it is crucial to make a strategy accordingly and execute on it.

You have to understand that business is not a gamble where you approach things with no strategy at all.

While planning a roadmap to your goals, you get to know your various flaws that were deteriorating the functioning of the business process.

Targeting such anomalies one by one, let your business to grow by taking your firm a step closer to your desired goal.

business strategy
 

What is Corporate Strategy?

Corporate strategy tends to focus on all the units or departments of a firm. It is responsible for the overall growth of the company.

The two primary goals of a corporate strategy are – Diversification and Vertical Integration. Diversification is vital for a business in order to expand into new sectors.

Many times what several corporate strategies assumed to be a failure turns out to be highly beneficial for the business, later on.

In order to develop a corporate strategy for your business, you need to analyze the weaknesses in the functioning of your business. You have to consider things like where you want your business to take and what steps are you taking for it, etc.

Also, remember that not every strategy you make will work out for your business. Cost leadership is one of the strategies that is used by most of the companies.

In cost leadership, a company provides its product or services at a minimal rate possible. This allows them to create a spike in their sales.

This also helps them to make their name in this competitive market. McDonald‘s is the best example of cost leadership in the restaurant industry.

corporate strategy

Main Differences Between Business Strategy and Corporate Strategy

  1. The business strategy focuses on how the company is performing overall so they can take steps accordingly in order to improvise the workflow. 
    However, corporate strategy concerns the type of business and the ultimate goal of it.
  2. The middle-level management, which includes managers of various divisions or units, is responsible for the formation of business strategy.
    However, corporate strategy is formed by top-level management, which includes boards of directors, CEO, etc.
  3. Business strategy is considered to be a short term strategy. Whereas, corporate strategy is a long one.
  4. In the business strategy, the primary focus is to make a business plan that will help the organization to achieve its desired goals.
    In the corporate strategy, the main focus is to fulfill the expectations of stakeholders.
  5. Business strategy is meant to compete with other available products in the market.  However, corporate strategy is meant to grow the profits of an organization.
Difference Between Business Strategy and Corporate Strategy
 

References

  1. https://dl.acm.org/citation.cfm?id=1407318
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