ABSTRACT
In 1980, Abell argued in a seminal book that defining the business provides the starting point for strategic planning. Defining the business entails a creative act, which demands an approach that leads to competitive superiority. This chapter follows the same logic and argues that defining the business represents the starting point for corporate level strategy. Defining the business is critical in several respects, namely: defining the corporate mission, formulating business unit strategies and setting performance goals, crafting the organizational structure and resource allocation system, conceptualizing relatedness and developing synergies, developing the firm's growth strategy and resolving agency problems. The Standard Industrial Classification (SIC) code was developed to classify establishments according to the type of activity in which they engage to promote uniformity and comparability in the presentation of statistical data collected by various agencies of the US government, state agencies, trade associations, and private research organizations.
