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78 Cards in this Set

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  • Back
Lecture 1
What has gotten Toyota into trouble and what has caused it?
+The Richard Nixon and Bill Clinton problem got Toyota in trouble

+Toyota has misled the public and resisted

+ Toyota has exhibited an external locus of control
What is Toyota's biggest challenge?
"Massive government support for Detroit automakers."
What's different about culture in Japan?
+Company's are almost never punished by courts in Japan

+Class-action lawsuits are very diffulcult to launch in Japan

+Confrontation in Japaneese culture is very looked down upon

+Point to take away: Regardless of where you are, society can't dictate where you are or hope you work. Bottom line is NO EXTERNAL LOCUS OF CONTROL
Has has support for Toyota's leadership wavered?
+Ahai Toyoda, CEO, struggles with leadership back home
+Questions have arised if he's right man to pull company through
+Reputation is based on 1,000 to 1 rule, you may do 1,000 things right but 1 thing erases all you've done
+Mr. Toyoda's leadership has been questioned
+He has stayed behind the scenes, employees feel in the dark believe he is surrounded by managers who wont tell him bad news.
What did Mr. Toyoda say in his editoral letter to the Wall Street Journal?
+"It is clear to me that in recent years we didn't listen or respond to customers."
+We didn't consider the human side.
+Have to look at people side and be with customer and in touch with customer
+Business deals with humans
+"I pledge Toyota will set new standard for company's transparency."
+Transparency- Openess in what we do an our decisions
+Be in touch and open
What are some of the things Leslie Fox, a bank branch manager is doing to help employees?
+"the worse decision I made in the bank was to have a teller-of-the-month award."
+Didn't work due to jealousy, shame, and unfairness
+Fox quickly changed the program and altered it and the new program was the "Hall of Fame."
+This allowed multiple awards for multiple people
+She only did the "of the month" award because others were doing it.
What are some of the things that got Wal-Mart in trouble with their overseas management?
+Home markets ran dry, so they moved overseas
+Years later they closed up in Germany and South Korea
+Thing is, people don't shop in Germany and Korea like they do in America
+Wal-Mart thought like Leslie Fox, "If I can do it here, I can do it everywhere." And that doesn't always work.
What is the story of Richard McGinn and Motorolla?
+McGinn aggressively invested in telecom in the 90's
+2000 comes and telecom market disappears
+Motorala CEO Chris Galvin didn't want to act to hasty, instead wanted to think over strategies.
+McGavin was to liberal, Galvin to conservative
+Both fell behind
What is the story of Hewlett-Packard we discussed in class?
+Two employees approached with ideas in the 1970's
+Reviewed and denied requests
+Turns out they turned down Steve Jobs trying to sell his idea on the "future of computing"
Similar to the Hewlett-Packard story, what is the story of Deca Records?
+Most popular music recorders in 1962
+Group comes in and performs and leaves demo tapes
+Executives review and "don't like sound" to much guitar and "it's on its way out"
+They lost their chance with signing the Beatles
Why should we understand Thumb Tacks?
+A lot of bad decisions come because people don't understand Thumb Tacks
+Chapter 7 and chapter 8 is the basic groundwork for decision making
Define decision-making:
Process by which people respond to opportunities and threats by choosing goals, analyzing options, and selecting courses of action
What are the two kinds of decisions? Define both:
+Program decisions - one with routine, virutually automatic decision making that follows established rules and guidelines where we have made similar decisions before
+Non-program decision making: Non-routine decision making that occurs in response to unusual, unpredictable, unique opportunities and threats, when there are no rules to follow and when we have uncertain or ambigous information
What does Wal-Mart's purchase of VuDu mean?
+Wal-Mart has purchased VuDu, a video on demand service
+Wal-Mart is a big player, so every move they make is being watched
+Although they've failed in digital media before this could pose a problem to cable providers
What is Blockbuster doing?
+Blockbuster is in a very difficult situation
+Are searching eagerly for a new strategy
What are casket makers doing?
+Sales of caskets have hit a dead end
+Casket makers are diversifying
+Hillenbrand is going outside of funeral business and buying Katron, a company that makes factory machines
What major move is Coke plotting?
+Coke near deal to purchase bottling company
+Strategic shift driven by changes in consumer taste
+Plans to buy Coca-Cola enterprises, there main bottler
+Believed that deal exceeds $15 billion
+Would cause major change in strategy
+Bottlers use to want high volumes, but Coca-Cola wants to diversift with niche products that don't produce high volumes
What is the classical model of decision making?
1.)People can identify all possible alternatives
2.)Assumes that we can evaluate all of these alternatives objectively, using numbers, logic, etc.
3.)You will be able to identify the consequences of each outcome: Assumes people are very bright, informed and logical. Therefore we will arrive at the one best solution. But, this may not work as well in real world.
Define Administrative Method of Decision-Making:
+Begins with assumption that human beings live under bounded rationalitiy, which is, that we are limited in our ability to be perfectly logical, rational, or analytical. In addition to our mental limits, are limits like time, resources, things we don't have enough of.
Define Satisficing:
In the face of bounded rationality, we search for and choose the first good enough alternative rather than the one best solution.
How do we make decisions in a group?
+It is believed that groups make better decisions than indviduals.
+But there is the danger of group decisions: Group Think
+Group Think is when people feel pressure to come to an agreement even though they do not agree with the group.
What are the four conditions when group think is most likely to occur?
1.)When a lot of emotions are going around
2.)When there is a lot of pressure to reach an agreement
3.)If diversity, criticizim, or innovative thinking is not tolerated
4.)If you have one person who is a dominant force, people will conform
So what do we do about about groupthink? And, explain how to effectively use the Devil's Advocate method.
+Having a diverse group should help breaks down groupthink
+AND, if you play the Devil's advocate and are able to get it to work. Here are the four things to make it work:

1.)Appoint a person to be the Devil's Advocate
2.)Point out problems with selection of alternatives
3.)Must defend unpopular of opposing points of view
4.)Should critique a process by which the group chooses among alternatives
Is economics a science? Explain.
+Economis is also known as the "Dismal Science"
+Science is where we take quatative
+We like to think of economics as objective
+For an economist these are the best of times and worst of times. Best of times because everyone wants explanations on why the economy has slipped. Worst of times because so few subjective answers.
+There's no consensus on cause of crisis and no consensus on plan to change
+Most science makes progress
+Economics is the one way, the big way, we understand what we do. With that are we given a tool or an art? Is it opionion or is it fact?
+We should expect less from economics
+We should be honest about what we know, honest about what we don't know, and honest about what we may never know.
What was discussed in the interview with the CEO of 3M?
+CEO George Buckly is rallying his team to make cheap respirator masks
+Many people ask "What can I add?" Yet few ask "What can I take away?"
+How do I take almost nothing and turn it into a break out product?
+Innovation isn't always hi-tek, it's often "zigging" while everyone else is "zagging"
How can we make our own networking profile? And why?
+Create a personal profile or "networking profile"
+Write down 20 target employers
+Also, write down 10 types of work that you could do
+Review your plan occasionaly, use it to think and braoden your horizion and thinking beyond the list we have today
How do we help our people become more creative as indivuduals. Three ways:
1.)Must provide your employees with both the opportunity and the ability to take risks.
2.)If people take risks, they will fail occasionally. With that,
What is the right kind of failure:
A.)No ethics violations
B.)How and why can be explained
C.)Employee can learn from it
D.)The right kind of failure means they don't repeat it.

3.)The manager must reward the right.
How do we do Brainstorming right? And, what is the importance of group creativity?
+Groups are more creative than indviduals.
+The five ways we can do brainstorming right are:
1.)People must meet face-to-face
2.)Everyone must suggest crazy, outlandish ideas
3.)When people give outlandish ideas, n ocomments: do not evaluate their comments
4.)Write them on a board
5.)Group must say something positive and negative against each idea
What do good mission statements ask?
Companies not only need a vision, but a good corporate mission statement, it asks 5 questions:
1.) Who are my customers? Is this for everyone?
2.) Why are we in business?
3.) What types of products and services will address those needs and wants?
4.) Where will we operate?
5.) How will we position ourselves, relative to the competition?
How will answering those 5 questions benefit your mission statement?
1.) It defines the business
2.) Allows us to establish major goals
3.) Provide us with a sense of direction and focus
4.) Having a good mission statement stretches everyone. It's inspiring.
What are the three levels of planning? Define each.
1.)Strategic Plan - broadest, most global type plan. Helps the whole organization reach long-term goals. Can be 3-5 years in scope into future.
2.)Tactical Plan - For each division. The tactical plan aims at 1 year. What are your plans for 2010?
3.)Operating Plan - More focused. For our indvidual departments within the division. Probably have a 3 month time horizion.
What are the six basic strategies that a company can pursue?
1.) Concentration strategy (also known focus strategy)
3.)Vertical Integration
4.)International Expansion
5.) Low Cost Strategy (also known as Cost-leader Stategy)
6.)Differentiation Strategy
Define Concentration Strategy (or Focus Strategy)?
When you just have one type of business. Very focused and very specialized in that niche. Ideal for firms just starting out. (e.g. McDonald's, Wal-Mart)
Define Diversification Strategy?
A.) Related Diversification - Proctor&Gamble
B.) Unrelated Diversification - Birkshire-Hathaway
Define Vertical Integration?
A.)Forward Vertical integration - Coca-Cola Bottling
B.)Backward Vertical Integration - INSERT GRAPH HERE
Define International Expansion Strategy?
+To what extent do we customize our products for different national countries, and cultures, versus standardizing our product worldwide for global effiecency?
+In general, as a rule of thumb, consumer products tend to be customized. Whereas, industrial commodities tend to be standardized.
A.) Global strategy - Make standardized product and ship it out to the whole world
B.) Multi-Domestic Strategy - focuses more on effectiveness
Define Low-Cost Strategy (or Cost-Leader Strategy)?
+About efficency, pressure to improve
Define Differentiation Strategy?
About effectiveness, image, and customer. Like Low-Cost strategy, can run the risk of conversion.
What should we remember when we want to do good?
+When out to do good think about others.
+Throw away your assumptions about what other people need.
+It's not always true that a little bit of help is better than no help.
What is Holbein's Platnium Rule:
"Do unto others as they would have you do unto them."
What should students remember when finding a job?
+Students should be able to articulate in one sentence, how you can contribute to your target company
+The best job candidtates connect their skills within the companies needs
+Target your ideal industries and ideal companies and then talk to the people that work there. Do informational interviews with them.
+The best part about being a student is that you can get face time with managers.
+Managers love being approached by students.
What are the sectors MBA's are finding jobs? The good and bad.
Medical Devices
Clean Energy
Supply Chain Management

Banking and Financial Services
What are the 6 things to do that will put a smile on the consumer's face? Define each.
1.)Procuring- Get stuff that no one else has
2.)Transforming - There's a lot of value in putting the pieces together. (e.g. assembly)
3.)Holding - You can make money by being good at holding inventory
4.)Promoting - You can make a bundle of money that people wouldn't originallybuy if you're a good promoter
5.)Distrubting- Getting the product to the customer when they need it (e.g. convience)
What are the two reasons for vertical integration?
1.) Capture profit margin
2.) Excercise control over uncertainity
What did a panel of world leaders agree were the five best practices for a sustainable business?
1.) If you believe that business and resources need to become more sustainable, don't make it about politics. Make it about economics.
2.) The financial market place needs more certainty in government policies.
3.) As an enterpernuer don't let the current uncertainties (or government uncertainities) to stop motivating, or in other words, keep innovating.
4.) You do want to be innovative, but don't be impractical (e.g. creativity is the weak glue, innovation is the post-it note)
5.) Look at waste as an opportunitiy
What are some hints and tips for powerful cover letters?
+Cover letters are very useful for career changes and for people who have a gap in work experience.
+Should craft different cover letters for each position and who to customize towards.
+Show how your background lines up with the requirements of the job.
+Make sure every cover letter is PERFECT or your hard work will back fire. Errors show a lack of attention to detail.
Who should your cover letter be customize towards?
+Customize it:
1.) for the employer/company. Each company is different.
2.)For the position
3.)For the product or service they make
4.)Depending on the industry you choose
5.)Indvidiual hiring manager
How should you organize your company?
Top tier: CEO
2nd tier: Executives
3rd tier: Managers
4th tier: Supervisors
Bottom tier: Workers
In structuring your company, what are the two decision making models that can influence your structure? Define each.
1.) Centralized decision making - decisions are made by the CEO
2.) Decentralized decision making - workers make decisions
What are the two forms of structure? Define each.
1.) Formal - If we want a centralized decision making model we need formal structure
2.) Flexible - If we want a decentralized decision making model we need flexible structure
What are four other determinits of corporate structure? Define each.
1.)Environment - if you live in a dynamic and turbulent environment you need a flexible structure.
2.) Technology - production and technology should tell you how to set up firm. If you have very complex technology you need a more formal structure. If you have simple technology you need a flexible structure.
3.) Corporate Strategy - Vertical integration or low cost strategy requires a formal structure. On the other hand if you use differentiation strategy you need a flexible schedule.
4.) Human Resources - The type of people who work for you tell you how you'll set up your company. If we have highly-skilled, highly-trained professionals we will use a flexible structure. If there's a low education there will be a much more formal structure.
What model does the Basic Organization Chart fit best?
+ If you have a one product firm
+If you have a new company
Define Silo Effect?
Each branch has a specific focus on their speciality, the drawback is that managers have trouble communicating across silos.
What is a functional structure?
Most basic way to organize.
Define Product Structure?
+Product structure is for related diversification. (e.g. Proctor and Gamble)
Define Divisional Structure?
+Divisional structure is for unrelated diversification
(e.g. GE and Berkshire-Hathaway)
Define Geographic Structure?
+Multi-domestic strategy
+Want managers to be in touch with needs of customer in that nation
Define Customer Structure?
+Service companies use this that have no particular strategy
+Clients are usually other businesses
+Devote Vice-President to each type of customer
Define Product Structure?
+Product structure is for related diversification. (e.g. Proctor and Gamble)
Define Divisional Structure?
+Divisional structure is for unrelated diversification
(e.g. GE and Berkshire-Hathaway)
Define Geographic Structure?
+Multi-domestic strategy
+Want managers to be in touch with needs of customer in that nation
Define Customer Structure?
+Service companies use this that have no particular strategy
+Clients are usually other businesses
+Devote Vice-President to each type of customer
What was discussed in the book review of "Passage to Nowhere."?
+Raul Amundson was the explorer who explored Arctic and Antarctic
+Discovery of Northwest passage is commercially irrelevant
Define Law of Unintended Consequences?
+You do one thing you think is good but it causes unintended consequences
Why are airlines threatening to cancel flights?
+Carriers will aggressively cancel flights during storms to avoid fines from the government for making passangers wait
+Air travel is now less reliable
+Delta, Government Policies, Etc.
What are the problems with Silos?
+Silos are efficient but not very effective
+They get everyone on the same page, but communication is broken across zones
Explain the Matrix Structure
+Became very useful for hi-tek companies or organizations that need to share learning
+This allows for communication to move between and break down silos
Define the Team-Structure?
+ Project-based kind of work, hire the best people with the best skills. Building a team that can contribute to projects, (e.g. consulting team)
+Finish project and move on to the next
+Flexible and dynamic
Define Span of Control?
+Number of subordinates that report to a mananger, horizontal.
+The simpler the work, the broader the span of control you have.
Define Chain of Command?
+Number of layers of management from the CEO down to the lowest worker, vertical.
+The more dynamic your work is the shorter your chain of command is.
Chapters 7, 8, 17, 20, 21, & 16