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CS Professional · Strategic Management and Corporate Finance · Introduction to Strategic Management

Kaveri Textiles Ltd. has set a vision of becoming India's most trusted sustainable apparel brand. The board is now deciding to shift from cotton blends to organic fabrics, and to allocate Rs 40 crore for new dyeing units. In strategic management terms, the board's decision on the shift in product direction primarily represents which stage?

The decision to change the product direction to organic fabrics is strategy formulation. At this stage the board chooses among alternatives to achieve its vision. Funding the dyeing units and executing the shift would later fall under implementation, while checking results would be evaluation.

  1. AStrategy formulationCorrect
  2. BStrategy evaluation
  3. COperational budgeting
  4. DEnvironmental scanning

Explanation

Choosing the strategic direction, such as moving to organic fabrics, is a decision made while formulating strategy. Allocating funds and building units is implementation. Scanning and evaluation are different stages. Budgeting is a tool of implementation, not the choice of direction.

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