Utilizing Office Depot apply the Grand strategy and explain their current and forecasted strategy (using concepts for Grand Strategy)

Please see the attached file.

Utilizing Office Depot apply the Grand strategy and explain their current and forecasted strategy (using concepts for Grand Strategy). With your experience explain if whether you agree or disagree on the forecasted strategy and why. Cite all sources.

Concept of Grand strategy

Grand strategies involve giving long term direct to the company. It can be of three types:
1. Expand business operations (growth strategies),
2 Decrease the scope of business operations (retrenchment strategies),
3. Maintain the status quo (stability strategies).

Thus the grand strategy is giving direction to the company and the generic strategy is related to the product. Grand strategy is broader in view then the generic strategy.
This is the "big picture" view of the organization and includes deciding in which product or service markets to compete and in which geographic regions to operate. Thus Corporate Strategy is concerned with the overall purpose and scope of the business to meet stakeholder expectations. Critical questions answered by corporate-level strategists thus include:

1. What should be the scope of operations; i.e.; what businesses should the firm be in?
2. How should the firm allocate its resources among existing businesses?
3. What level of diversification should the firm pursue; i.e., which businesses represent the company's future? Are there additional businesses the firm should enter or are there businesses that should be targeted for termination or divestment?
4. How diversified should the corporation's business be? Should we pursue related diversification; i.e., similar products and service markets, or is unrelated diversification

GROWTH STRATEGIES

Growth strategies are meant for expansion. It can be of following types:

1. Concentration strategy the firm attempts to achieve greater market penetration by becoming highly efficient at servicing its market with a limited product line (e.g., McDonalds in fast foods).
2. Vertical integration strategy, the firm attempts to expand the scope of its current operations by undertaking business activities formerly performed by one of its suppliers (backward integration) or by undertaking business activities performed by a business in its channel of distribution (forward integration).
3. A diversification strategy entails moving into different markets or adding different products to its mix. If the products or markets are related to existing product or service offerings, the strategy is called concentric diversification. If expansion is into products or services unrelated to the firm's existing business, the diversification is called conglomerate diversification.
(tutor2u.net)

STABILITY STRATEGIES

When firms are satisfied with their current rate of growth and profits, they may decide to use a stability strategy.

RETRENCHMENT STRATEGIES

Retrenchment strategies involve a reduction in the scope of a corporation's activities,

Case of Office Depot

Office Depot is one of the biggest organization in office products and services. It supplies anything and everything related to the office including business machines, computers, computer software and office furniture, while its business services encompass copying, printing, document reproduction, mailing and shipping. Office Depot's customers include small office/home office, medium-sized and large businesses located in the U.S. and in 22 other countries around the globe. The Company sells its products through multiple distribution channels, including over 1,000 office supply stores, direct mail, Internet websites, business-to-business e-commerce, and sales forces.
(Wikipedia)

Vision of Office Depot

"Delivering Winning Solutions That Inspire Worklife™"

Delivering

Our actions speak louder than words. We are accountable: doing what we say we're going to do ? efficiently and on time.

Winning

We act with confidence. We're proud to win. We push ourselves to greater heights. And we don't settle for less than being the best.

Solutions

We listen to our customers and understand their needs. We offer products, services and innovative thinking that enable our customers to achieve success.

Inspire

Our inspiration is contagious and enables us to unleash creativity to help people achieve their goals. Our motivation and enthusiasm inspire others to succeed.

Worklife™

We combine our energy for work with our passion for life. We are creating a fuller, more enriched lifestyle. We share the desire to maximize human potential to achieve personal dreams.
(www.officedepot.com)

Grand Strategy of Office Depot
It is pursuing the growth strategy and it is into concentric diversification. It means that it is growing in the industries which are related to the office supplies. For this they are acquiring other organization. In 1998, they merged with the catalog company Viking Office Products. In June 2003, Office Depot Inc. acquired Guilbert, formerly part of the Pinault-Printemps Redoute Group (PPR). With this strategic acquisition, Office Depot has doubled its presence in Europe to around 3 billion Euros. I agree with the forecasted strategy as this is sharpening their focus on its core competencies.
They have clearly specified their focus of catering to the office supplies and related products and services. Thus they are in pursuit of critical mass in this segment through organic and inorganic growth.
Moreover they are buying other companies to create a more competitive, cost-efficient company. The companies will come together hoping to gain a greater market share or achieve greater efficiency. Because of these potential benefits, target companies often agree to be purchased when they know they cannot survive alone.
There are a variety of reasons that Office Depot go for this strategy
SYNERGY
Synergy is the major reason for the acquisitions
Synergy is the magic force that allows for enhanced cost efficiencies of the new business. Synergy takes the form of revenue enhancement and cost savings.
BENEFITS OF LARGE SIZE
The mergers and takeover will create one of the largest consumer goods Company in the world. It will reap benefits of economies of scale and size by this takeover. A merger can also improve a company's standing in the investment community: bigger firms often have an easier time raising capital than smaller ones.

STRENGTHENING OF BRAND PORTFOLIO
One element of the growth strategy of our consumer product subsidiaries is to strengthen their brand portfolios through active programs of selective acquisitions like the acquisitions of Viking and Guilbert.

Aggressive Ecommerce strategy
Office Depot has consciously been aggressive on ecommerce front. Now anyone and every one can purchase from Office depot conveniently through user friendly websites. It has made huge technology investments to deliver consistency and convenience to customers. This is also part of its growth strategy and will be very important component in future as ecommerce is growing rapidly. Infact the company has emerged not just as the biggest generator of revenue from office supplies online but as one of the biggest retailers on the Web anywhere, with more than $1.5 billion in sales.
http://www.findarticles.com/p/articles/mi_zdbln/is_200112/ai_ziff19481 as retrieved on 16 Oct 2006 09:20:26 GMT.

References
Corporate strategy by G Hamel

• Kroll, M., P. Wright, and R. Heiens. "The Contribution of Product Quality to Competitive Advantage: Impacts on Systematic Variance and Unexplained Variance in Returns." Strategic Management Journal 20 (1999): 375-384.

• Porter, M. Competitive Advantage: Creating and Sustaining Superior Performance. New York: Free Press, 1985.

• ——. Competitive Strategy: Techniques for Analyzing Industries and Companies. New York: Free Press, 1980.