The ultimate test of the value of a corporate-level strategy is whether the:
A) Corporation earns a great deal of money
B) Top management team is satisfied with the corporation's performance
C) Businesses in the portfolio are worth more under the management of the company in question than they would be under any other ownership
D) Businesses in the portfolio increase the firm's financial returns

Question

Quizplus · Accepted Answer

The ultimate test of the value of a corporate-level strategy is whether the businesses in the portfolio are worth more under the management of the company in question than they would be under any other ownership. This means that the corporate-level strategy should create value for all businesses within the portfolio, and that the company should be able to generate higher financial returns by owning and managing these businesses than any other potential owner could. This is the key criterion for evaluating the effectiveness of a corporate-level strategy. While the other options may be important, they are not as fundamental to the success of the strategy as the creation of long-term shareholder value through the management of the portfolio of businesses.

The Ultimate Test of the Value of a Corporate-Level Strategy