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78 Cards in this Set
- Front
- Back
What are the INPUTS in the N and T Congruence Model?
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Environment
Resources History - what managers can not control (in the short term) |
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What are the components of the TRANSFORMATION PROCESS in the N and T Congruence Model?
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Informal
Work Formal People -Tools the organization uses to convert inputs into outputs |
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What are the OUTPUTS in the N and T Congruence Model?
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Organization
Group Individual -Are we performing effectively? |
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What concerns are in the STRATEGY in the N and T Congruence Model?
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What business should we be in? And how should we compete in these business?
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Characteristics of FORMAL ORGANIZATION in the Transformation Process
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explicit, codified aspects of the organization (structure, rewards, control systems)
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Characteristics of INFORMAL ORGANIZATION in the Transformation Process
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implicit, assumed aspects of the organization (culture, values, communication, patterns)
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Characteristics of WORK in the Transformation Process
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characteristics of jobs and how jobs are related to each other
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Characteristics of PEOPLE in the Transformation Process
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characteristics of members of the organization (demography, personality, skills, motivation)
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Define CONGRUENCE
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The degree to which the needs, demands, goals, objectives, and/or structures of one component are consistent with those of the other.
Greater congruence = more effective organization |
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Define INTERNAL FIT
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between the transformation process and strategy
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Define EXTERNAL FIT
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between the strategy and environment
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What are the SIX components of the GENERAL ENVIRONMENT
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Demographic
Sociocultural Political/Legal Technological Economic Global |
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Define/Give examples of DEMOGRAPHIC segment of the General Environment
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Demographics are the most easily understood and quantifiable elements of the gen envi. They are the root of many changes in society.
Ex: Aging population, rising affluence, changes in ethnic composition, geographic distribution of population, greater disparities in income levels |
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Define/Give examples of SOCIOCULTURAL segment of the General Environment
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Sociocultural forces influence the values, beliefs, and lifestyles of a society.
Ex: More women in work force, increase in temporary workers, greater concern for fitness, greater concern for environment, postponement of family formation |
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Define/Give examples of POLITICAL/LEGAL segment of the General Environment
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Political processes and legislation influence the environmental regulations with which industries must comply
Ex: tort reform, deregulation, increase in minimum wage, taxation, legislation on corporate governance reforms |
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Define/Give examples of TECHNOLOGICAL segment of the General Environment
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Developments in technology lead to new products and services and improve how they are produced and delivered to the end user.
Ex: Genetic engineering, the Internet, research in synthetic and exotic materials, pollution and global warming, nanotechnology |
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Define/Give examples of ECONOMIC segment of the General Environment
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Key economic indicators have impacts on all industries from suppliers of raw materials to manufacturers of finished goods and services, as wells as all organizations in the service, wholesale, retail, government, and nonprofit sectors.
Ex: Interest rates, unemployment, CPI, trends in GDP, changes in stock market |
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Define/Give examples of GLOBAL segment of the General Environment
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Globalization provides both opportunities to access larger potential markets and a broad base of production factors but also carry many risks.
Ex: Increasing global trade, currency exchange rates, emergence of economies, trade agreements, tariffs and free trade |
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What are the the THREE components of the COMPETITIVE ENVIRONMENT?
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Competitors
Customers Suppliers |
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What are the FIVE FORCES of Industry Competition
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Threat of New Entrants
Bargaining Power of Suppliers Bargaining Power of Buyers Threat of Substitutes Rivalry among Existing Firms |
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What are the considerations of the THREAT of NEW ENTRANTS in the 5 Forces Model?
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*Threat is lower when barriers are higher
*Profits can be eroded by new competitors -Economies of Scale -Product Differentiation -Access to Distribution Channels -Switching Costs -Capital Requirements -Cost Disadvantage |
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What are the considerations of the BARGAINING POWER of BUYERS in the 5 Forces Model?
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*Buyers can force down prices
*Can force competitors against each other -Concentrated Groups -Purchase larger volumes of seller's sales -Low product differentiation -Few Switching costs ... all make power higher |
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What are the considerations of the BARGAINING POWER of SUPPLIERS in the 5 Forces Model?
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*Can threaten to raise prices
Powerful if: -Concentrated (dominated by few companies) -industry not important customer of supplier -Supplier's product (input) is important to industry -poses threat of fwd integration |
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What are the considerations of the THREAT of SUBSTITUTES in the 5 Forces Model?
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*Limit the potential returns of an industry - place price ceiling
*Lower price of subs = higher threat to industry |
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What are the considerations of the INTENSITY of RIVALRY in the 5 Forces Model?
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*Rivalry diminishes profits, resources devoted to price competition, advertising, increased customer service, etc
Intensifies as: -Number of competitors increase -Industry growth slows -Lack of differentiation/switching costs -Equally balanced competitors -High fixed or storage costs -High exit barriers |
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What are the THREE types of GOALS?
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1. Organizational-level goals
2. Group-level goals 3. Individual-level goals |
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What are examples of ORGANIZATION level goals?
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Resources utilization, profits, sales, flexibility/adaptability, growth
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What are examples of GROUP level goals?
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Contribution to organizational-level objectives, cohesion, integration
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What are examples of INDIVIDUAL level goals?
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Satisfaction, productivity, ethical behavior, quality of work life
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What are the THREE characteristics of good goals?
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1. Specific (measurable, timeframe)
2. Difficult ("stretch goals") 3. Accepted but those who are expected to achieve them |
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What are examples of metrics to MEASURE goals?
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Financial Measures (Profit growth/ratio, sales growth, mkt share, cost ratio)
New Product Development Quality Customer Satisfaction Employee Satisfaction Employee Turnover Behaviors |
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Who are the SIX STAKEHOLDERS that evaluate effectiveness of goals?
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1. Stockholders
2. Customers 3. Suppliers 4. Employees 5. Government 6. Lenders |
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What are the FOUR rules for ETHICAL DECISION MAKING?
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1. Utilitarian Rule
2. Moral Rights Rule 3. Justice Rule 4. Practical Rule |
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Define UTILITARIAN RULE in ethical decision making.
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An ethical decision should produce the greatest good for the greatest number of people.
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Define MORAL RIGHTS RULE in ethical decision making.
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An ethical decision should maintain and protect the fundamental rights and privileges of people.
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Define JUSTICE RULE in ethical decision making.
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An ethical decision should distribute benefits and harm among people in a fair, equitable and impartial manner.
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Define PRACTICAL RULE in ethical decision making.
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An ethical decision should be one that a manager has no hesitation about communicating to people outside the company because the typical person in society would think the decision is acceptable.
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What are the FOUR approaches to SOCIAL RESPONSIBILITY? (From low to high)
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1. Obstructionist approach
2. Defensive approach 3. Accommodative approach 4. Proactive approach |
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Define OBSTRUCTIONIST approach in social responsibility.
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Companies choose not to behave in a socially responsible way and behave unethically and illegally.
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Define DEFENSIVE approach in social responsibility.
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Companies behave ethically to the degree that they stay within the law and abide strictly with legal requirements.
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Define ACCOMMODATIVE approach in social responsibility.
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Companies behave legally and ethically and try to balance the interest of different stakeholders as the need arises.
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Define PROACTIVE approach in social responsibility.
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Companies actively embrace socially responsible behavior, going out of their way to learn about the needs of different stakeholder groups and utilizing organizational resources to promote the interest of all stakeholders.
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What is the difference between CORPORATE level strategy and BUSINESS level strategy?
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Corporate - What businesses should we be in?
Business - How should we compete? => What products/services? Which markets? What technologies? |
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What are the THREE types of COMPETITIVE ADVANTAGE?
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1. Overall Cost Leadership
2. Differentiation 3. Focus Strategy |
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Define OVERALL COST LEADERSHIP in competitive advantage strategies.
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Firms create a low-cost position relative to their peers. Must reduce costs throughout entire value chain. Must have parity on the basis of differentiation relative to competitors.
Pitfalls: too much focus on one value-chain activity, all rivals share common input (raw materials), strategy is easily imitated, erosion of cost advantages when pricing info becomes available to customers |
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Define DIFFERENTIATION in competitive advantage strategies.
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Firms create differences in their product/service by creating something that is perceived as unique and valued by customers (industry wide). Reduce costs in all areas that do not affect differentiation. Perceptions of product quality can be strongly influence by downstream primary activities in value chain.
Pitfalls: uniqueness that is not valuable, too much differentiation, premiums too high, easily-imitated differentiation, dilution of brand identification through product-line extensions. |
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Define FOCUS in competitive advantage strategies.
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Firms put direct attention towards narrow product lines, buyer segments, or targeted geographic markets.
-Cost focus or differentiation focus -"NICHES" Pitfalls:erosion of cost advantage within narrow segment. competition from new entrants, can become too focused. |
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What are the FOUR SUPPORT ACTIVITIES in the Value Chain?
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1. Firm Infrastructure
2. Human Resource Management 3. Technology Development 4. Procurement |
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Give examples of HUMAN RESOURCE MANAGEMENT with a Cost Leadership Strategy.
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Mimimize costos associated with employee turnover through effective policies.
Effective Orientation and training programs to maximize employee productivity. |
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Give examples of TECHNOLOGY DEVELOPMENT with a Cost Leadership Strategy.
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Effective use of automated technoloy to reduce scrappage rates
Expertise in process engineering to reduce manufacturing costs. |
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Give examples of FIRM INFRASTRUCTURE with a Cost Leadership Strategy.
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Few management layers to reduce overhead costs.
Standardized accounting practices to minimize personnel required. |
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Give examples of PROCUREMENT with a Cost Leadership Strategy.
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Effective policy guidelines to ensure low cost raw materials (with acceptable quality levels).
Shared purchasing operations with other business units. |
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Give examples of FIRM INFRASTRUCTURE with a Differentiation Strategy.
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Superior MIS - to integrate value-creating activities to improve quality
Facilities that promote image Widely respected CEO enhances firm reputation |
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Give examples of HUMAN RESOURCE MANAGEMENT with a Differentiation Strategy.
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Programs to attract talented engineers and scientists
Provide training and incentives to ensure a strong customer service orientation |
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Give examples of TECHNOLOGY DEVELOPMENT with a Differentiation Strategy.
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Superior material handling and sorting technology
Excellent applications engineering support |
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Give examples of PROCUREMENT with a Differentiation Strategy.
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Purchase of high-quality components to enhance product image
Use of the most prestigious outlets |
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What are the FIVE PRIMARY ACTIVITIES in the Value Chain?
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1. Inbound logistics (activities to receive, store and disseminate inputs)
2. Operations (Activities to transform inputs to outputs) 3. Outbound Logistics (Activities to collet, store and distribute outputs) 4. Marketing and sales (Activities to inform buyers and induce them to purchase) 5. Service (after-sales activities) |
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Give examples of INBOUND LOGISTICS in a Cost Leadership Strategy.
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Effective layout of receiving dock operation
Shipping costs reduced |
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Give examples of OPERATIONS in a Cost Leadership Strategy.
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Effective use of quality control inspectors to minimize rework on the final product
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Give examples of OUTBOUND LOGISTICS in a Cost Leadership Strategy.
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Effective utilization of delivery fleets
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Give examples of MARKETING AND SALES in a Cost Leadership Strategy.
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Purchase of media in large blocks
Sales force utilization is maximized by territory management |
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Give examples of SERVICE in a Cost Leadership Strategy.
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Thorough service repair guidlines to minimize repeat maintenance calls
Use of single type of repair vehicle to minimize costs |
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Give examples of INBOUND LOGISTICS in a Differentiation Strategy.
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Superior material handling operations to minimize damage
Quick transfer of inputs to manufacturing process |
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Give examples of OPERATIONS in a Differentiation Strategy.
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Flexibility and speed in responding to changes in manufacturing specs
Low defect rates to improve quality |
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Give examples of OUTBOUND LOGISTICS in a Differentiation Strategy.
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Accurate and responsive order processing
Effective product replenishment to reduce customer's inventory |
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Give examples of MARKETING AND SALES in a Differentiation Strategy.
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Creative and innovative advertising programs
Fostering of personal relationship with key customers |
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Give examples of SERVICE in a Differentiation Strategy.
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Rapid response to customer service requests
Complete inventory of replacement parts and supplies |
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What are the FOUR stages of the LIFE CYCLE of an INDUSTRY
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1. Introduction
2. Growth 3. Maturity 4. Decline |
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What are the characteristics of the INTRODUCTION stage of Industry Life Cycle?
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Generic Strategy: Differentiation
Mkt Growth Rate: Low # of Segments: Very few Intensity of Competition: Low Emphasis on Product Design: Very High Emphasis on Process Design: Low Major Functional Areas of Concern: R&D Overall Objective: Increase Mkt Share Awareness |
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What are the characteristics of the GROWTH stage of Industry Life Cycle?
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Generic Strategy: Differentiation
Mkt Growth Rate: Very large # of Segments: Some Intensity of Competition: Increasing Emphasis on Product Design: High Emphasis on Process Design: Low to Moderate Major Functional Areas of Concern: Sales and Marketing Overall Objective: Create consumer demand |
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What are the characteristics of the MATURITY stage of Industry Life Cycle?
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Generic Strategy: Differentiation/ Overall Cost Leadership
Mkt Growth Rate: Low to Moderate # of Segments: Many Intensity of Competition: Very Intense Emphasis on Product Design: Low to moderate Emphasis on Process Design: High Major Functional Areas of Concern: Production Overall Objective: Defend Mkt Share and extend product life cycles |
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What are the characteristics of the DECLINE stage of Industry Life Cycle?
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Generic Strategy: Overall Cost Leadership, Focus
Mkt Growth Rate: Negative # of Segments: Few Intensity of Competition: Changing Emphasis on Product Design: Low Emphasis on Process Design: Low Major Functional Areas of Concern: General Management and Finance Overall Objective: Consolidate, maintain, harvest, or exit |
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What is RELATED DIVERSIFICATION?
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Sharing tangible and intangible resources. - Has to do with primary activities
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What is UNRELATED DIVERSIFICATION?
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Value creation derives from corporate office. Leverages support activities.
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What are TWO ways to save costs from RELATED DIVERSIFICATION?
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Cost savings from...
1. Leveraging core competencies 2. Sharing related activities among business in corporation |
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Define CORE COMPETENCY.
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Something that your firm is particularly food at, and is not easily imitated or substituted by your competitors.
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What are TWO ways to achieve VALUE (synergy) that can be created from RELATED DIVERSIFICATION?
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1. Pooled negotiating power
2. Vertical integration |
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What are the THREE means to achieving DIVERSIFICATION?
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1. Acquisitions or mergers
2. Joint Ventures or Strategic Alliances (pooling resources of other companies with a firm's own resource base) 3. Internal Development (New products, markets, technology) |