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CMA Intermediate · Operations Management and Strategic Management · Formulation and Implementation of Strategy

Which statement about functional-level strategy is correct?

Functional-level strategy translates the business strategy into concrete departmental plans and policies for areas like marketing, finance, production and HR. It supports the business-level strategy and is mainly developed by functional managers, while industry choice belongs to corporate strategy.

  1. AIt decides which industries the group should enter.
  2. BIt defines the competitive advantage of the whole corporation.
  3. CIt translates business strategy into departmental plans such as marketing, finance and production policies.Correct
  4. DIt is formulated only by the board of directors and never by department heads.

Explanation

Functional strategies convert business-level strategy into specific plans for each department, mostly framed by functional managers. Industry choice is corporate-level, and competitive positioning is business-level.

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