Management Terms Ch. 8

Front 1

Strategic Management

Back 1

set of decisions and actions to formulate and implement strategies that will provide competitively superior fit between the organization and its environment so as to achieve organizational goals

Front 2

Three categories of grand strategy

Back 2

* growth
* stability
* retrenchment

Front 3

Grand Strategy

Back 3

the general plan of major action by which an organization intends to achieve its long-term goals

Front 4

Growth (grand strategy)

Back 4

the expanding of business and it can be promoted internally by investing in expansion or externally by acquiring additional business divisions

Front 5

Stability (grand strategy)aka pause strategy

Back 5

means that the organization wants to remain the same size or grow slowly and in a controlled fashion

Front 6

Retrenchment (grand strategy)

Back 6

the organization is going through a period of forced decline by either shrinking current business units or selling off or liquidating entire businesses

Front 7

Global Strategy

Back 7

is a coherent strategy to provide synergy among worldwide operations for the purpose

Front 8

Three categories of global strategy

Back 8

* globalization
* multidomestic
* transnational

Front 9

Globalization (global strategy)

Back 9

the standardization of product design and advertising strategies throughout the world

Front 10

Multidomestic (global strategy)

Back 10

the modification of product design and advertising strategies to suit the specific needs of individual countries

Front 11

Transnational (global strategy)

Back 11

a strategy that combines global coordination to attain efficiency with flexibility to meet specific needs in various countries

Front 12

Strategy

Back 12

is the plan of action that prescribes resource allocation and other activities for dealing with the environment and helping the organization attain its goals

Front 13

Core Competence

Back 13

a business activity that an organization does particularly well in comparison to competitors

Front 14

Synergy

Back 14

the condition that exists when the organization's parts interact to produce a joint effect that is greater than the sum of the parts acting alone

Front 15

Value Creation

Back 15

value can be defined as the combination of benefits received and costs paid by the customers. Companies create value by devising strategies that exploit core competencies and attain synergy.

Front 16

Levels of strategies (3)

Back 16

* corporate level
* business level
* functional level

Front 17

Corporate level (level of strategies)

Back 17

concerned with the question "What business are we in?" Pertains to the organization as a whole and the combination of business units and product lines that make it up.

Front 18

Business level (level of strategies)

Back 18

concerned with the question "How do we compete?" Pertains to each business unit or product line within the organization.

Front 19

Functional level (level of strategies)

Back 19

concerned with the question "How do we support the business-level strategy?" Pertains to all the organization's major departments.

Front 20

Strategy formulation

Back 20

the stage of strategic management that involves the planning and decision making that lead to the establishment of the organization's goals and of a specific strategic plan

Front 21

Strategy Implementation

Back 21

the stage of strategic management that involves the use of managerial and organizational tools to direct resources toward achieving strategic outcomes

Front 22

SWOT analysis (2)

Back 22

* internal strengths and weaknesses
* external opportunities and threats

Front 23

SWOT analysis (definition)

Back 23

Strengths, Weaknesses, Opportunities, and Threats. An analysis of the strengths, weakness, opportunities and threats that affect organizational performance.

Front 24

Internal strengths and weaknesses (SWOT analysis)

Back 24

Strengths are positive internal characteristics that the organization can exploit to achieve its strategic performance goals. Weaknesses are internal characteristics that might inhibit or restrict the organization's performance.

Front 25

External opportunities and threats

Back 25

Threats are characteristics of the external environment that may prevent the organization from achieving its strategic goals. Opportunities are characteristics of the external environment that have the potential to help the organization achieve or exceed its strategic goals.

Front 26

Portfolio strategy

Back 26

a type of corporate-level strategy that pertains to the organization's mix of SBU's (strategic business units) and product lines that fit together in such a way as to provide the corporation with synergy and competitive advantage

Front 27

BCG matrix (4)

Back 27

* stars
* cash cows
* question marks
* dogs

Front 28

Stars (BCG matrix)

Back 28

has a large market share in a rapidly growing industry. It has additional growth potential and should be a focus of assets.

Front 29

Cash Cows (BCG matrix)

Back 29

exists in a mature, slow-growing industry but is a dominant business in the industry, with a large market share. It has a positive cash flow and does not command a large number of assets.

Front 30

Question Marks (BCG matrix)

Back 30

exists in a new, rapidly growing industry but has only a small market share. Is risky and it could become a STAR or fail.

Front 31

Dogs (BCG matrix)

Back 31

is a poor performer. It only has a small share of a slow-growth market. Provides little profit for the corporation and may be targeted for divestment or liquidation if turnaround is not possible.

Front 32

Most difficult to identify in BCG matrix

Back 32

question marks

Front 33

BCG matrix (definition)

Back 33

a concept developed by the Boston Consulting Group that evaluates strategic business units (SBUs) with respect to the dimension of business growth rate and market share

Front 34

Porters Competitive forces model (5)

Back 34

* potential new entrants
* bargaining power of buyers
* bargaining power of suppliers
* threat of substitute products
* rivalry among competitors

Front 35

Potential new entrants

(Porters Competitive forces model)

Back 35

faces barriers to enter markets. Capital requirements and economies of scale are examples of these potential barriers that can keep out new competitors.

Front 36

Bargaining power of suppliers

(Porters Competitive forces model)

Back 36

the concentration of suppliers and the availability of substitute suppliers are significant factors in supplier power. Sole suppliers have greater power

Front 37

Bargaining power of buyers

(Porters Competitive forces model)

Back 37

informed customers become empowered customers. Because customers are better informed, they have a better bargaining position.

Front 38

Threat of substitute products

(Porters Competitive forces model)

Back 38

the power of alternatives and substitutes affect a company's bargaining power

Front 39

Rivalry among competitors

(Porters Competitive forces model)

Back 39

because of competition, it is more difficult for companies to distinguish themselves from other competitors

Front 40

Porters Competitive forces model

Back 40

a model that studies the competitive forces that affect a business. It helps determine a company's position in the industry market.

Front 41

Competitive strategies (3)

Back 41

* differentiation
* cost leadership
* focus

Front 42

Differentiation (Competitive strategies)

Back 42

competitive strategy that which the organization seeks to distinguish its products or services from competitors

Front 43

Cost Leadership (Competitive strategies)

Back 43

competitive strategy which the organization aggressively seeks efficient facilities, cut costs, and employs tight cost controls to be more effective than competitors

Front 44

Focus (Competitive strategies)

Back 44

competitive strategy that emphasizes concentration on a specific regional market or buyer group

Front 45

Factors in Strategy Implementation (5)

Back 45

* leadership
* structural design
* information and control systems
* human resources
* implementing global strategies

Front 46

Leadership

(Factors in Strategy Implementation)

Back 46

is the ability to influence people to adopt the new behaviors needed for strategy implementation

Front 47

Structural design

(Factors in Strategy Implementation)

Back 47

begins with the organizational chart. It pertains to managers' responsibilities, their degree of authority, and the consolidation of facilities, departments, and divisions.

Front 48

Information and control systems

(Factors in Strategy Implementation)

Back 48

include reward systems, pay incentives, budgets for allocating resources, information technology systems, and the organization's rules and policies, and procedures

Front 49

Human resources

(Factors in Strategy Implementation)

Back 49

function recruits, selects, trains, transfers, promotes, and lays off employees to achieve strategic goals

Front 50

Implementing Global Strategies

(Factors in Strategy Implementation)

Back 50

the larger the company, the harder it is to implement strategies