• Understand the main theoretical assumptions and rationales behind external corporate strategies and diversification.
• Analyze the competitive landscape in relation to an industry and/or market.
• Understand and apply growth strategy models to specific cases and discuss the implications.
• Reflect on value creation and synergies of external growth strategies both at the individual operation level and at the corporate level.

The course aims to provide knowledge about how firms use external growth strategies to fulfill their corporate goals. In particular, Alliances and Acquisitions have characterized the economic scenario in many industries, not only at the level of industrial dynamics, but also when looking at financial markets. During the ’80s and the ’90s waves of alliances and acquisitions depicted most of the global industries, in particular high-tech industries, as valid (and preferred) alternatives to organic growth. Yet, more than 50% of such agreements fail in generating corporate value. As strategic responses to increases success chances of external growth, corporations have mainly focused on: i) set up venture capital funds (i.e. Corporate Venture Capital funds – CVC) ii) international expansions in new geographies and, iii) redesign corporate diversification approach towards value creation.

Recent studies show that managers do not distinguish clearly under which conditions they would need to consider the most appropriate mode for external corporate growth. In particular, alliance or acquisitions as alternative options are still a black box for most of the firms. And, this could likely explain part of the performance implications of these complex strategies. Therefore, this course will bring together perspectives from Marketing, Finance and Entrepreneurship into the main domain of Strategy, in particular Corporate and Competitive, to more deeply understand rationales and mechanisms related to external corporate growth strategies.

Ideally, the course will be based on the following main questions:

• In which businesses should a corporation compete?
• Which activities should be carried out inside the firm’s boundaries and which should be outsourced?
• How does the institutional context affect a firm’s diversification and organization?
• What are the most appropriate mechanisms for growth in different settings (i.e. mergers, acquisitions, alliances, equity investments)?
• How do M&As create/destroy value?
• What might influence the choice between organic and external growth?
• What is an alliance? What is an acquisition? How does a manager choose between and alliance and an acquisition?
• What are the performance implication of alliances and acquisitions? How do we measure the performance of an alliance or an acquisition?
• How do alliance and acquisition matter for innovation?
• What is the role of alliances and acquisitions for corporate international expansion?
• How corporate entrepreneurship in the form of corporate venture capital contribute to the corporate growth?
• What are the competitive implications of corporate venture capital?

The main objective of this course is to familiarize students to the matters that impact a firm's choice of strategy, scope, and organization. The course builds on classical and recent theoretical contributions in the fields of industrial organization and organizational economics. Along with these theoretical perspectives, the course ultimately is designed to focus on the essential issues and problems of corporate strategy as experienced by managers.

• Highly interactive course in class
• Most of the work is performed in class
• Sessions are a mix of frontal teaching, class case discussion, small groups exercise.
• Examination is about apply concepts discussed in class
• Group work is relevant to the learning experience.

SAMPLE READINGS

An introduction to Diversification Strategies

Readings

• Porter, M. E. (1987). From Competitive Advantage to Corporate Strategy. Harvard Business Review 65, no. 3, May – June, pp. 43-59.
• Collis, DJ & CA Montgomery (1998). Creating corporate advantage. Harvard Business Review,76, no. 3,   May-Jun, pp. 70-83.

Cases

• Venkataraman, S.; Summers, M. (2002). Pepsico: The challenge of growth through Innovation

Corporate Scope: Horizontal vs. Vertical Integration

Readings

• Piskorski, M. (2007). Choosing corporate and global scope

Cases

• Srikanth, G.; Maldar, F. (2004). Esquel’s vertical integration.
• Casadesus-Masanell, R.; Tarzijan, J.; Mitchell, J. (2009). Arauco (A): forward integration or horizontal expansion?

Corporate Development I: Cooperative Strategies

Cases

• Löffler et al. (2004). Bayer and Millennium Pharmaceuticals: success based on perfect interaction
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Corporate Development II: Acquisitive Strategies

Cases

• Mohanty, S. (2010). Google’s acquisition of ITA software: a diversification strategy?

Corporate Development III: Alliances vs. Acquisitions

Readings

• Dyer, kale and Singh (2004). When to ally and when to acquire, Harvard Business Review
• Zollo and Meier (2008). What is an M&A performance? The Academy of Management Perspectives

Cases

• Alcacer, J.; Collis, D.; Furey, M. (2009). The Walt Disney Company and Pixar, Inc: to acquire or not to acquire?
• Yoshino, M.; Fagan, P. (2003). Renault – Nissan Alliance

International Corporate Growth

Readings

•     Gupta, A.K. and Govindarajan, V. (2000). Managing global Expansion. A conceptual framework, Business Horizons, 43(2), pp. 45-54.

• Porter, M. (1990). The competitive advantage of nations. Harvard Business Review. March-April

Cases

• Ghemawat, P.; Ballarin, E.; Campa, J. (2005). Santander’s acquisition of abbey: banking across borders
• Perepu, I.; Purkayastha, D.; Maseeha, S. (2008). Entry and expansion strategy: TESCO in Japan, IBS Center for Management Research

External Growth and Innovation Strategies

Growth through Entrepreneurship I: Corporate Intrapreneurship

Cases

• Bartlett, C.; Mohammed, A. (1994). 3M Optical System: Managing Corporate Entrepreneurship

 Growth through Entrepreneurship I: Corporate Venture Capital

Readings

• Chesbrough, H. (2002). Making Sense of Corporate Venture Capital
• Wolcott, R.; Bauke, B.; Baierl, R. (2015). Corporate Venture Capital

Cases

• Rajagopalan, S. (2011). Google Ventures: disrupting corporate venture capital?
• Laufer, R.; Lane, D.; Hamermesh, R. (2006). Corporate Venture Capital at Eli Lilly

Book of reference

Grant, R. Contemporary Strategy Analysis (from 7th edition onward)