Corporate Diversification Strategies Raise A Wide Range Of S

Corporate Diversification Strategies Raise A Wide Range Of Strategic M

Corporate diversification strategies raise a wide range of strategic management issues. For this week’s critical thinking, read the case study found in your textbook: Case 16: Manchester City: Building a Multinational Soccer Enterprise, p.554 (in the textbook). Remember, a case study is a puzzle to be solved, so before reading and answering the specific case and study questions, develop your proposed solution by following these five steps: Read the case study to identify the key issues and underlying issues. These issues are the principles and concepts of the course module, which apply to the situation described in the case study. Record the facts from the case study which are relevant to the principles and concepts of the module.

The case may have extraneous information not relevant to the current module. Your ability to differentiate between relevant and irrelevant information is an important aspect of case analysis, as it will inform the focus of your answers. Describe in some detail the actions that would address or correct the situation. Consider how you would support your solution with examples from experience or current real-life examples or cases from textbooks. Complete this initial analysis and then read the discussion questions.

Typically, you will already have the answers to the questions but with a broader consideration. At this point, you can add the details and/or analytical tools required to solve the case.

Case Study Questions

Under what circumstances can a company extend its competitive advantage from its home market to an overseas market? Issues concerning the transferability and replicability of the firm’s competitive advantage are critical here. What are the distinctive features of City Football’s strategy?

What mode of foreign market entry should City Football adopt? Why? Again, issues of resources and capabilities and the need for local market knowledge, distribution, and political and business connections become critical here. What criteria can companies apply in deciding what new diversification to pursue and which should City Football apply in deciding? What changes in the financial structure, organizational structure and management systems would you recommend?

You should meet the following requirements: Be 6-7 pages in length, which does not include the title page or required reference page, which are never a part of the content minimum requirements. Use APA style guidelines. Support your submission with course material concepts, principles, and theories from the textbook and at least two scholarly, peer-reviewed journal articles unless the assignment calls for more. It is strongly encouraged that you submit all assignments into the Turnitin Originality Check before submitting it to your instructor for grading. If you are unsure how to submit an assignment into the Originality Check tool, review the Turnitin Originality Check—Student Guide for step-by-step instructions.

Review the grading rubric to see how you will be graded for this assignment. Readings Chapter 12 in Contemporary Strategy Analysis Chapter 12 PowerPoint slides Chapter 12 PowerPoint slides - Alternative Formats in Contemporary Strategy Analysis Srinivasan, S., Thenmozhi, M., & Vijayaraghavan, P. (2020). Performance Implications of Diversification Strategies during Institutional Transformations: An Emerging Market Study . Asia-Pacific Management Accounting Journal, 15(3), 1. Recommended: Khan, S. U., & Rizwan, M. F. (2020). Ownership Concentration, Owner Identity and Technological Innovation Propensity: Moderating Role of Corporate Diversification. Pakistan Journal of Commerce & Social Sciences, 14(4), 913–961.

Paper For Above instruction

The strategic management of corporate diversification presents complex challenges and opportunities, especially when expanding into international markets. The case study, Manchester City: Building a Multinational Soccer Enterprise, exemplifies these dynamics, illustrating how a sports club transitions into a global enterprise through strategic diversification and international expansion. Analyzing the key issues from the case provides insights into the broader principles of strategic management, emphasizing the importance of resources, capabilities, and market understanding in successful global growth.

A fundamental question is under what circumstances a firm can extend its competitive advantage from its home market to an overseas market. The transferability and replicability of a firm’s core competencies—such as brand strength, operational efficiency, and managerial expertise—are central to this process. According to the resource-based view (RBV) of the firm, competitive advantage depends on unique resources that are valuable, scarce, imperfectly imitable, and non-substitutable (Barney, 1991). When firms seek international expansion, they must assess whether these resources can be effectively transferred or adapted to new markets, considering differences in consumer preferences, regulatory frameworks, and competitive landscapes. For instance, Manchester City leveraged its brand and managerial expertise to establish its presence in foreign markets, but it also faced challenges related to adapting its strategy to local cultural contexts.

City Football’s strategy is distinguished by its focus on global branding, strategic partnerships, and leveraging its digital platforms to reach international audiences. Central to its approach is creating a multi-sourced revenue stream that includes broadcasting rights, merchandising, and international competitions. Unlike traditional sports clubs that primarily depended on ticket sales and local sponsorship, City Football’s internationally focused strategy involves building a global fan base and forming alliances across different regions. This distinctive feature demonstrates a strategic move to diversify revenue sources and reduce dependence on local markets, aligning with the theory of corporate-level strategy that emphasizes diversification to manage risk and capitalize on global opportunities (Porter, 1987).

Regarding mode of foreign market entry, City Football faces critical decisions about whether to use joint ventures, franchising, licensing, or wholly owned subsidiaries. Given the need for local market knowledge, distribution channels, and political considerations, a mixed approach often proves optimal. For example, in entering emerging markets with high political risks or fragmented distribution channels, partnerships with local firms can facilitate market entry by leveraging local knowledge and networks (Hill, 2013). A wholly owned subsidiary might be appropriate in mature markets with established regulatory frameworks and high potential for direct control. Considering City Football’s resources and capabilities, forming strategic alliances with local clubs or sports organizations could provide access to existing fan bases, stadium facilities, and regulatory frameworks, reducing entry risks and investment costs.

Deciding on the pursuit of new diversification opportunities involves evaluating the firm's core competencies, market attractiveness, and synergy potential. City Football, in expanding internationally and diversifying its operations, should apply criteria such as strategic fit, resource complementarities, and the capacity to sustain competitive advantage (Ghemawat, 2001). Additionally, technological capabilities and brand equity should be assessed for their scalability across different markets. The company needs to prioritize markets with favorable legal and political environments, existing demand for football entertainment, and aligned cultural preferences to maximize success.

Organizational and financial structural adjustments are critical in supporting these strategic initiatives. For example, establishing a dedicated international business development unit can facilitate market-specific strategies and coordinate global operations. Financially, City Football might consider securitization of assets or forming joint financial ventures to share risks and capitalize on local market opportunities. Organizationally, implementing matrix or decentralized structures can empower regional managers to adapt strategies to local conditions while maintaining overall strategic coherence (Daft, 2015). Management systems should incorporate advanced digital platforms and real-time performance metrics to monitor progress and enable agile decision-making in international markets.

In conclusion, Manchester City’s strategic expansion exemplifies the importance of leveraging core competencies, selecting suitable market entry modes, and aligning organizational structures with strategic goals. Success in international diversification depends on careful assessment of transferability and replicability of competitive advantages, along with thoughtful structural and managerial adjustments. These strategies enable firms like City Football to sustain competitive advantage and foster sustainable global growth, illustrating broader principles of strategic management in multinational enterprise development.

References

• Barney, J. B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99-120.
• Daft, R. L. (2015). Organization theory and design. Cengage Learning.
• Ghemawat, P. (2001). Distance still matters: The hard reality of global expansion. Harvard Business Review, 79(8), 137-147.
• Hill, C. W. L. (2013). International business: Competing in the global marketplace. McGraw-Hill Education.
• Porter, M. E. (1987). From competitive advantage to corporate strategy. Harvard Business Review, 65(3), 43-59.
• Srinivasan, S., Thenmozhi, M., & Vijayaraghavan, P. (2020). Performance Implications of Diversification Strategies during Institutional Transformations: An Emerging Market Study. Asia-Pacific Management Accounting Journal, 15(3), 1-22.
• Khan, S. U., & Rizwan, M. F. (2020). Ownership Concentration, Owner Identity and Technological Innovation Propensity: Moderating Role of Corporate Diversification. Pakistan Journal of Commerce & Social Sciences, 14(4), 913-961.
• Additional scholarly sources relevant to international corporate strategy and sports management literature can also be incorporated for more depth.