What is corporate strategy? The art of ensuring that the value of the enterprise as a whole is more than the sum of its parts. BCG helps companies unlock their strategic “sweet spot” and create value for long-term success.
The goal of corporate strategy is to articulate a vision of a great company that is also a great stock—and to define the specific moves needed to bring that vision to life. Rooted in a clear understanding of competitive advantage, corporate strategy lays out a multiyear roadmap for how best to leverage advantage to develop business strategies for growth and drive strong, sustained value creation. A winning corporate strategy will identify the optimal business portfolio, prioritize the right growth platforms, and set a financial strategy to transform vision into value.
Our corporate strategy work with clients focuses on answering questions in four key areas:
Mission, vision, and ambition. Who are we? Where is our industry headed? And where do we want to be five or ten years from now?
Corporate portfolio strategy. What is the overall logic of our business portfolio? And what are the roles and strategic priorities (generate cash, expand and grow, divest) of the business units it comprises?
Corporate growth strategy. What are business strategies for growth? Do we need to pursue new growth vectors? What are the key platforms that will realize our growth ambition?
Financial strategy.
Do we have the right processes and policies to link strategy to value creation? Do we efficiently allocate capital—and is the balance between reinvestment in the business and payouts to investors optimal? Do we have the right investors and investor story?
Portfolio strategy—helping clients determine how to invest capital across businesses, products, and initiatives to maximize returns—has been at the core of BCG’s DNA since our founding. And any good value creation strategy depends on a clear portfolio strategy and active management of the business portfolio that focuses on three imperatives:
Our corporate strategy consultants have completed over 4,000 corporate strategy engagements over the past five years. For example, we helped:
A high-performing building products company define the initiatives—portfolio moves and investor communications—needed to drive a new wave of value creation, leading to a TSR increase of 5 percentage points in the subsequent three years.
A family-owned industrial conglomerate overcome a valuation discount by rethinking portfolio, financial policies, organization, and management structures to unlock a 35% increase in valuation.
Corporate leaders have a pivotal role in bridging the divide between institutional sustainability commitments and day-to-day investing practices.
As we navigate an uncertain world, what do investors expect from the US economy, the US stock market, and business leaders?
Corporate and financial acquirers are pursuing M&A targets more cautiously, but they have not closed shop.
This edition of BCG Executive Perspectives, based on a survey of C-suite leaders, reveals what executives are prioritizing and the actions they are taking amid current global uncertainties.
