When companies like Apple or Coca-Cola develop their strategy, do they stop at the corporate level? Of course, not! Other levels are just as important, with the functional-level strategy being the foundation on which everything else is built.
Keep reading to learn more, and don’t forget to check out the examples!
🔝 Top 6 Functional Level Strategy Examples
- Business Growth and Opportunity Strategies
- Wal-Mart's Competitive and Strategic Analysis
- Corporate Functional Management in Organization
- Amazon and Yahoo Companies: Strategic Planning
- Living Ventures Limited Company's Analysis
- Amazon’s Business Strategy and Corporate Structure
👔 What Is Functional Level Strategy?
Functional-level strategy is a plan of action created to help companies achieve short-term goals and support business- and corporate-level strategies. The functional level strategy is paramount in managing operational-level activities on a routine or daily basis. Furthermore, each functional unit in a business also develops its own strategies.
What Are the Benefits of Functional Level Strategy?
- It makes it possible to achieve bigger business goals.
- It is crucial in developing a good layout for day-to-day business operations.
- It serves as a binding force for the organization, helping to integrate production, R&D, marketing, and HR.
- It is practical and helpful in addressing every business scenario as it unfolds.
How Can Functional Level Strategy Contribute to Efficiency?
Understanding the meaning of functional-level strategy can help improve efficiency in an organization by strengthening the relationship between departments. The strategy makes it possible to analyze an organization’s internal and external environment and tap resources to steer it to the next level.
What Are Functional Level Strategy Characteristics?
When developing a functional-level strategy, managers make sure that it has the following characteristics:
- It reflects business-level goals.
- There is enough resource allocation in all areas.
- There’s maximum coordination between functional areas for a better outcome.
🚀 Corporate, Business, and Functional Level Strategies Compared
Strategies are the foundations of decisions made in organizations. If your corporate-, business-, and functional-level strategies are poor, there is a high risk of failure. Consider using the Strategy Pyramid, which combines functional-, business-, and corporate-level strategies, for better results. Let’s look at each of these strategies:
|🌐 Corporate-Level Strategy||This strategy focuses on how to gain a competitive advantage in every line of operation. It focuses on selecting an optimal set of an organization and determining how they are integrated into the entire business.|
|🏢 Business-Level Strategy||This is the strategy that most people are familiar with. It targets to answer the questions such as, “How can we compete on the market?” and “How can we get a competitive advantage over our rivals?”|
|⚙️ Functional-Level Strategy||This strategy is targeted at improving a company’s effectiveness in its departments. It brings together all the units to ensure they are working towards the core objective of an organization.|
🔥 Functional Level Strategy Examples of Companies
The following are functional-level strategy examples that demonstrate its practical application to help improve the effectiveness of operations in the respective organizations:
Functional Level Strategy of Apple
In Apple‘s functional level strategy, the focus is lifestyle segmentation that targets the urban population. Every department, from R&D to marketing, works towards reaching and delivering value to the targeted urban market.
Functional Level Strategy of Coca-Cola
The strategy of Coca-Cola involves directing the company’s resources to its brands to create standardized products. Eventually, this removed the difference noted between American and international markets.
Functional Level Strategy of Google
When Google received complaints about ads appearing on the same screens with inappropriate content, it opted for a functional-level strategy. The strategy empowered advertisers with greater control over where their ads would appear. It gave advertisers the option of declining unwanted content.
Functional Level Strategy of Yahoo
After joining Yahoo to help turn it around, Merissa Mayer could not achieve the objective. The failure resulted from the firm’s inability to implement her decisions at the functional level. She had to revise part of her business strategy of selling the company’s assets.
Other examples of companies with great functional level strategies include:
With the right functional-level strategies, achieving short, medium, and long-term goals becomes easy.