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Corporate politics: Strategy and structure

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  1. Abstract
  2. Introduction
  3. Corporate assessment
  4. The shared cost structure under the experience curve model
    1. Keichel's experiment regarding the cost structure
    2. Answering the question 'what purpose shared cost and experience curve models serve?'
  5. The Asset Segmentation model
    1. Implication of specialization
    2. The control panel and the maturity level of the portfolio
  6. Value chain model and globalization
  7. Conclusion
  8. References

Organizational management theories are models based on the strategic core elements that define corporate structure. These strategic essentials are aimed towards corporate planning and decisional management processes. By essence, models follow the economic principle of ceteris paribus - ?all other variables in the logical equation are assumed constant and fixed? ? Wolfgram. Consequently, the need for organizations to reassess their structure and set new strategies in compliance of the market's regulations mechanisms is an understatement. In fact, growing evidence supports the argument that corporate models are archaic and need to be in compliance with the current environment. We will illustrate how corporation asset and liability management can swerve the orientation of a business into a misleading direction. Companies should focus instead in specialization and diversification of their operational and strategic avenues. These avenues feed from a corporate political system enabling businesses to be proactive and strategically functional to track, audit, and integrate many economic, financial, and operational variables

[...] These two variables are intimately imbricated with the structural mapping of operational and managerial processes which leads me to the core content that corporate structure and strategic models are too complex for them to be assigned to archaic and obsolete models. When we exclusively funnel the benefits deriving from shared cost and experience curve models to other divisions without considering the major dysfunctional consequences, we take the risk to face many internal and external challenges. To the question: what purpose shared cost and experience curve models serve? [...]

[...] Specialization implies that all efforts are aligned within the corporate political and strategic structure and aimed towards specific goals. The objective is to achieve a sense of zenithal performance and gain a decisive competitive edge. every business must also try to obtain the most from its specialization. It must diversify. The balance between these two determines the scope of a business? (Kumar, 2005). In fact, the specialization factor reaches its end once the company accomplishes the above-mentioned objectives, but remains strictly linked to the diversification process. [...]

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