The Role of the Corporate Centre

Parenting Styles

Summary of the Parenting Styles Model by Goold and Campbell. Abstract

Michael Goold, Andrew Campbell

The Parenting Styles theory (PS) of Michael Goold, Andrew Campbell is a framework about the role of the corporate centre in a corporation. It was addressed in their book, "Strategies and Styles", and several articles. They argue that there are many successful approaches to corporate strategy based upon management styles. Main determinants are the approaches taken to planning influence of the centre and the type of control influence exerted by the centre on the businesses within the group. From this they identify 3 generic stereotypes which companies tend to follow. There are other styles but most tend to converge upon one of these three generic styles. Each style is different in its approach, can offer different advantages to the corporation, but has different strengths and weaknesses.

The three generic PS of Goold and Campbell are:

1. Financial Control
2. Strategic Planning
3. Strategic Control

Parenting Style:	Strategic Philosophy	Role of Corporate Center	Role of SBU's	Typical # Businesses	Corporate VBM Methods	Detail level information Corporate Center
Financial Control	Portfolio	Financial. Aims to provide a better investment performance.	Manage strategy against tight financial targets set by centre. Autonomous.	Many Diverse	Financial (Risk) and Uniform	Low
Strategic Control	Linkages	Coordinates and reviews strategy. Set fairly tight financial & strategic targets. Attempts to create links between businesses to create competitive advantage.	Largely develop strategy but coordinated by Centre.	Moderate	Limited Corporate Scorecard	Medium
Strategic Planning	Core Competence	Drives strategy. Around important potential synergies / competences. Strongly coordinating actions and creating linkages between units.	Concentrate on implementation. Assist in strategy.	Low Similar	Comprehensive Corporate Scorecard	High

Which type of influence/style is best to maximize value creation? The answer is complex but depends and can be determined upon the corporate purpose, history and culture and upon the reconciliation of multiple paradoxes of parenting advantage (control versus empowerment, responsiveness versus synergy, portfolio versus core competence).

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