World University of Bangladesh
Course Title: Strategic Management [MGT 901]
Homework -10 Marks
Submitted to
Md. Azim
Assistant Professor
of
Business Administration
World University of Bangladesh
Submitted by
FUAD NASER KHAN
Roll: 4384
Batch: 72d
Program: BBA
Student mail:
[email protected] World University of Bangladesh
Date of Submission: 17 March 2023
TASK: In the perspective of Bangladesh, give recent examples of Market Penetration,
Market Development, Product Development, Forward Integration, Backward Integration,
Horizontal Integration, Related Diversification, Unrelated Diversification, Joint Venture,
Retrenchment, Divestiture, and Liquidation. In each of the examples, mention the
company name(s) and explain the benefit achieved due to the strategies taken by the
particular company.
Answer:
1. Market Penetration: - It describes a technique that involves boosting the market share of
already-available goods or services in a level. The objective is to increase the number of
clients who purchase the product or service or inspire current customers to do so.
Example -Robi has used the market penetration strategy by providing discounts,
launching new call bundles, and improving the quality of its services.
2. Market Development: - It is a strategy for increasing the market for existing products or
services by targeting new client groups or geographical location. Finding new services for
current goods or services is the goal.
Example - The PRAN-RFL Group has implemented the market development strategy by
growing its product line, entering new markets, and introducing new brands to meet the
needs of various customer categories.
3. Product Development: -It refers to a strategy where new goods or services are produced
for already-existing markets. Offering clients brand-new, better goods and services is the
goal.
Example- Kazi Farm has implemented the product development method to introduce new
and innovative products such as Kazi Foods' ready-to-cook frozen food items, Layer chicks
and table eggs, and Kazi Organic fertilizer.
4. Forward Integration: - It indicates a strategy that involves obtaining or increasing
businesses that are situated closer to the last customer. The goal is to improve customer
satisfaction or enhance control over the supply chain.
Example- Olympic Industries has used a forward integration strategy by developing its
own distribution network and retail locations to market its products directly to
consumers.
5. Backward Integration: - It describes a strategy that involves obtaining or existing
businesses that are located closer to the supply chain's inputs or raw materials. Increased
productivity or less reliance on suppliers is the targets.
Example- BEXIMCO Textiles has used a backward integration strategy by creating its own
spinning mills to produce yarn for its textile activities.
6. Horizontal Integration: - It describes a strategy that involve buying or creating businesses
that are comparable to the existing company. Expanding the market or achieving cost
savings are the targets.
Example- To improve its market share and performance, City Group has implemented a
horizontal integration strategy by increasing its operations within the same industry, such
as by opening new sugar mills and wheat mills.
7. Related Diversification; - It describes a strategy that involves investing or developing
businesses that are comparable to the current company in terms of technology, supply
chains, or clientele. The intention is to use already-existing resources and instruments to
enter into a new market.
Example- The BEXIMCO Group has implemented a related diversification strategy by
entering into new industries that are related to its current business activities, like
launching a ceramics business to complement its textile business.
8. Unrelated Diversification: - Unrelated diversification is a business strategy in which a
corporation extends into a new market or industry unrelated to its current business
operations. By extending the company's product or service offerings into new, unrelated
markets, usually through mergers or purchases, this type of variation is performed.
Example- The Bashundhara Group implemented a strategy of Unrelated Diversification by
entering new markets unrelated to its current industry. like starting a media company and
an LPG company.
9. Joint Venture: - An agreement between two or more businesses to cooperate on a
particular project or for a set amount of time is known as a joint venture. A joint venture's
mission is to bring together the organizations involved to achieve a common purpose by
merging their skills, knowledge, and market analysis.
Example- In Bangladesh, Robi Axiata Limited and Airtel Bangladesh Limited established a
joint venture in 2016. Robi Axiata Limited was able to increase its market share and
become more competitive in Bangladesh's telecommunications sector because to the
joint venture. The two businesses were also able to combine resources, cut expenses, and
increase process efficiency as a result of combining, which helped them provide better
customer service. In order to give its consumers greater and more comprehensive
coverage, the two businesses joined their networks, infrastructure, and technological
platforms as part of the joint venture.
10. Retrenchment: - Retrenchment strategy is a tactical thing that involves reducing the size
or area of an organization's operations in an attempt to improve its profit or financial
stability. When pressure from inside or outside the firm are having a negative impact on
performance, this strategy is commonly applied.
Example- Grameenphone Limited implemented a retrenchment strategy in 2019 by
offering an early retirement program to workers in order to save money as well as
increase productivity.
11. Divestiture: - It is known as a company's assets, business divisions, or businesses may be
sold off in so it can focus on its main business or to solve financial difficulties.
Example- British American Tobacco Bangladesh Company Limited implemented a
divestment plan by selling its Leaf Services business unit to local investors in order to focus
on its main cigarette business.
12. Liquidation: - A business is able to adopt a liquidation strategy, in which case it ends
operations, sells off its assets, resolves its debts, and shares any profits to its shareholders
after paying off its lenders.
Example-In 2018, Beximco Synthetics Ltd. filed liquidation because it was unable to pay
its debts.
