Corporate level strategy is the highest level in a strategic hierarchy that concerns with the objectives of the organization, acquisitions and allocation of resources, and the coordination of businesses portfolio for optimal performance (Ginter, Duncan & Swayne, 2013). The nature of the strategic decisions made at this level represents the overall direction of the organization regarding its growth and management of the business, service and product line. The type of strategy that is essential at this level is the retrenchment strategy. In situations when a health care organization is experiencing poor performance, it would be useful to employ the retrenchment strategy. The top management has an obligation to develop a directional strategy for the organization since they are directly responsible for the organization’s capital providers. Precisely, the retrenchment strategy entails reducing operational costs in the organization by downsizing personnel and products (Ginter, Duncan & Swayne, 2013). Similarly, the health care organization can divest those business units and markets that underperform and outsource critical business operations such as patient billing, dialysis service or emergency department staffing. The organization’s management use retrenchment strategy as a turnaround scheme to help the organization regain its strength and financial stability. The organization will achieve its target by scaling back in weak area and concentrate on the parts that exhibit competitive advantage and profit.
Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2013). Strategic management of health care organizations. San Francisco, CA: Jossey-Bass, Wiley.
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