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33 Cards in this Set
- Front
- Back
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strategy
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a set of related actions that managers take to increase their company's performance.
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strategic leadership
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to most effectively manage a company's strategy-making process to create competitive advantage.
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strategy formulation
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task of selecting strategies
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strategy implementation
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task of putting strategies into action
designing delivering supporting |
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competitive advantage
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when a company's strategies lead to superior performance compared to competitors
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superior performance
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maximizing shareholder value is the ultimate goal of profit making companies
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ROIC
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return on invested capital
(profitability) |
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ROIC
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net profit/ capital invested
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sustained competitive advantage
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when a company's strategies enable it to maintain above average profitability for a number of years
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profitability and profit growth are determined by two main factors
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overall performance of its industry relative to other industries
its relative success in its industry as compared to the competitors |
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corporate-level managers
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oversee the development of strategies for the whole organization
CEO main gun |
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business-level managers
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responsible for overall company, business unit, or divisional performance
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functional - managers
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responsible for supervising a particular task or operation
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5 steps of the strategy making process
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1 mission and goals
2 identify opportunities and threats 3 identify strengths and weaknesses 4 select strategies that correspond to above 5. implement the strategies |
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mission
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the reason for existence - what an organization does
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vision
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a statement of some desired future state
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values
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a statement of key values that an organization is committed to
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major goals
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the measurable desired future state that an organization attempts to realize
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Mission - what?
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what is it that the company does
customer customer needs how customer needs are being satisfied a company's mission is best approached from a customer-oriented business definition |
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values - What
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how managers and employees should conduct themselves
how to do business organizational culture |
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organizational culture
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the set of values, norms, and standards that control how employees work to achieve an organization's mission and goals
often seen as an important source of competitive knowledge |
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key characteristics of well-constructed goals
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precise and measurable
address crucial issues challenging but realistic specify a time period focus on long-run performance and competitiveness |
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external analysis
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to identify the strategic opportunities and threats in the organization's operating environment that will affect how it pursues its mission
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external analysis requires an assessment of
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industry environment in which company operates
the country or national environments in which it competes the wider socioeconomic or macro environment that may affect the company and its industry |
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internal analysis
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purpose is to pinpoint the strengths and weaknesses of the organization
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internal analysis includes an assessment of
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quantity and quality of a company's resources and capabilities
ways of building unique skills and company-specific or distinctive competences |
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building and sustaining a competitive advantage requires a company to achieve superior
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efficiency
innovations quality responsiveness to customers |
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SWOT
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helps to identify strategies that align a company's resources and capabilities to its environment - in order to create and sustain a competitive advantage
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functional level strategt
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directed at operational effectiveness
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business level strategy
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businesses overall competitive themes
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global strategy
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expand, grow and prosper at a global level
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corporate level strategy
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to maximize profitability and profit growth
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Viable business model
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when all functional strategies are taken together
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