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105 Cards in this Set

  • Front
  • Back

Planning

1. Setting goals and deciding how to achieve them



2. Coping with uncertainty by formulating future courses of action to achieve specified results

Reasons Not To Plan

1. Planning requires you to set time aside to do it.



2. You may have to make some decisions without a lot of time to plan.

Benefits Of Planning

1. Planning helps you check on your progress.



2. Planning helps you coordinate activities.



3. Planning helps you think ahead.



4. Planning helps you cope with uncertainty!!!

Strategies Types for Dealing with Uncertainty


(Raymond Miles and Charles Snow)

1. Defenders: "Let's stick to what we do best"; experts at producing narrowly defined products


2. Prospectors: "Let's create our opportunities"; focus on developing new products


3. Analyzers: Let let other take the risk then imitate or improve.


4. Reactors: Make adjustments only when forced to by environment.

The Adaptive Cycle


(Raymond Miles and Charles Snow)

1. Entrepreneurial: selecting and making adjustments of products and markets



2. Engineering: producing and delivering the products



3. Administrative: establishing roles, relationships, and organizational processes

Mission Statement

"What is our reason for being?"

Vision Statement

"What do we want to become?"

Strategic Planning

Done by top managers for the next 1-5 years



Long term decisions about overall direction of organization

Tactical Planning

Done by middle managers for the next 6-24 months



Implement policies/plans of top management; make decisions without clearly defined procedures

Operational Planning

Done by first-line managers for the next 1-52 weeks



Direct daily tasks of non managerial personnel; make decisions with well-defined set of procedures

Goal

specific commitment to achieve a measurable result within a stated time period

Action Plan

Defines course of action needed to achieve the stated goal

Operating Plan

Defines how you will conduct your business based on the action plan; identifies clear targets (revenues, cash flow, etc)

Types of Plans

Standing Plan



Single Use Plan

Standing Plans

Policy: standing plan the outlines the general response to a designated problem



Procedure: Standing plan that outlines response to a particular problem



Rule: Standing plan that designates specific required action

Single Use Plans

Program: single use plan encompassing a range of projects or activities



Project: single use plan of less scope and complexity than a program

SMART Goals

Specific


Measurable


Attainable


Results-oriented


Target Date

Management by Objectives (MBO)

1. Jointly Set Objectives


2. Develop Action Plan


3. Periodically Review Performance


4. Give Performance Appraisal and Rewards

Requirements for MBO to be successful

1. Top management must be committed



2. It must be applied organization-wide



3. Objectives must "cascade" (work their way down getting more specific along the way)

Planning/Control Cycle Steps

Planning


1. Make the plan


2. Carry out the Plan



Control


3. Control the direction by comparing results


4. Control the direction by:


a. correcting deviations


b. improving future plans

Business Plan

document that outlines a proposed firm's goals, the strategy for achieving them, and the standards for measuring success

Strategy

large scale action plan that sets the direction for an organization

Strategic Management

process that involves managers from all parts of the organization in the formulation and implementation of strategies and strategic goals

Reasons organizations should adopt strategic management and strategic planning

1. providing direction and momentum



2. encouraging new ideas



3. developing a sustainable competitive advantage

Sustainable competitive advantage occur when organization can get and stay ahead in:

1. being responsive to customers



2. innovating



3. quality



4. effectiveness

Michael Porter

"most important strategist working today"

Strategic Positioning

attempts to achieve sustainable competitive advantage by preserving with is distinctive about the company-Michael Porter

Key Principles of Strategic Positioning

1. Strategy is the creation of a unique and valuable position



2.Stratagy required trade off is in competing



3. Strategy involves creating a "fit" among activities

3 Sources of strategic positioning

1. few needs, many customers



2. broad needs, few customers



3. broad needs, many customers

5 steps of strategic management process

1. Establish the mission and the vision.


2. Establish the grand strategy with environmental scanning.


3. Formulate the strategic plans.


4. Carry out the strategic plans.


5. Maintain strategic control.

Grand Strategy

after assessment of current organizational performance, explains how the organization's mission is toe be accomplished

3 common grand strategies

1. growth: expansion



2. stability: little or no significant change



3. defensive (retrenchment): reduction in organization's efforts

Strategic Formulation

process of choosing among different strategies and altering them to best fit the organization's needs

Strategy Implementation

putting strategic plans into effect

Strategic Control

monitoring the execution of strategy and making adjustments if necessary



a. engage people


b. keep it simple


c. stay focused


d. keep moving


(Bryan Barry)

3 Kinds of strategic planning tools/techniques

1. competitive intelligence



2. SWOT analysis



3. forecasting

competitive intelligence

gaining information about one's competitors' activities so that you can anticipate their moves and react appropriately

Ways to gain competitive intelligence

public prints and advertising



investor information



informal sources

Environmental Scanning

careful monitoring of an organization's internal and external environments to detect early signs of opportunities and threats

SWOT Analysis

Internal: strengths, weaknesses



External: opportunities, threats

2 types of forecasting

trend analysis: hypothetical extension of a past series of events into the future



contingency planning (scenario analysis): creation of alternative hypothetical but equally likely future conditions

Porter's 5 competitive forces (from Porter's model for industry analysis)

1. threats of new entrants


2. bargaining power of suppliers


3. bargaining power of buyers


4. threats of substitute products or services


5. rivalry among competitors

Porters's 4 competitive strategies

1. Cost leadership strategy: keep costs/prices low for a wide market)


2. Differentiation strategy: offer unique and superior value for a wide market


3. Cost focus strategy: keep costs/prices low for a narrow market


4. Focused differentiation strategy: offer unique and superior value for a narrow market


single product strategy

company makes and sells one product within its market



pro: focused


con: vulnerable



diversification strategy

operating several businesses in order to spread the risk



unrelated: independent business lines


related: related business lines (reduced risk, management efficiencies, synergy)

BCG (Boston Consulting Group) matrix

means of evaluating strategic business units on the basis of



1. their business growth rates


2. their share of the market

Execution: the discipline of getting things done

Larry Bossidy



Rama Charan

execution

central part of any company's strategy. consists of questioning, analysis, and follow-through to mesh strategy with reality.

3 core processes of business

People: who will benefit you in the future



Strategy: how success will be accomplished



Operations: what path will be followed

7 essential types of leader behaviors

1. know your people and your business


2. insist on realism


3. set clear priorities


4. follow through


5. reward the doers


6. expand people's capabilities


7. know yourself

decision

choice made from among available alternatives

decision making

process of identifying and choosing alternative courses of action

rational (classical) model of decision making

explains how managers should make decisions

4 steps in rational decision making

1. identify the problem



2. think up alternative solutions



3. evaluate alternatives and select solution



4. implement and evaluate chosen solution

nonrational model of decision making

explains how managers actually make decisions

3 nonrational decision models

1. satisficing: managers seek alternatives until that find satisfactory, not optimal



2. incremental: managers take small short term steps to alleviate a problem



3. intuition: making a choice without use of conscious thought or logical inference

7 implementation principles of evidence based management



Jeffrey Pfeffer and Robert Sutton

1. treat organization as unfinished prototype


2. no brag, just facts


3. see your organization as outsiders do


4. not just for senior executives


5. like everything else, you still need to sell it


6. if all else fails, slow the spread of bad practice


7. best diagnostic question" what happens when people fail?

What makes it hard to be evidence based?

1. there's too much evidence


2. there's not enough good evidence


3. the evidence doesn't quite apply


4. people are trying to mislead you


5. YOU are trying to mislead you


6. the side effects outweigh the cure


7. stories are more persuasive, anyway

Key attributes among analytic competitors

1. use of modeling: predictive modeling-the data mining technique used to predict future behavior



2. having multiple applications



3. support from the top

risk propensity

willingness to gamble or to undertake risk for the possibility of gaining an increased payoff

decision making style

reflects the combination of how an individual perceives and responds to information

value orientation

the extent to which a person focuses on either task and technical concerns or people and social concerns

tolerance for ambiguity

the extent to which a person has a high need for structure or control in his or her life

directive style

action oriented decision makers who focus on facts



task/technical concern oriented


low tolerance for ambiguity

analytical style

careful decision makers who like lots of info



task/technical concern oriented


high tolerance for ambiguity

conceptual style

decision makers who rely on intuition and have a long term perspective



people/social aspect oriented


high tolerance for ambiguity

behavioral style

most people oriented decision makers



people/social aspect oriented


low tolerance for ambiguity

Uses for knowledge of decision making styles

know thyself



influence others



deal with conflict

ethics officer

someone trained about matters of ethics in the workplace, particularly about resolving ethical dilemmas

decision tree

graph of decisions and their possible consequences

When confronted with a decision manger should ask:

1. is the proposed action legal?



2. if yes, does the proposed action maximize shareholder value?



3. if yes, is the proposed action ethical?



4. if no, would it be ethical not to take the action?

4 ineffective reactions when confronted with a decision

1. relaxed avoidance: manager takes no action in belief there will be no great consequence


2. relaxed change: manager opts for first available alternative that's low risk


3. defensive avoidance: can't find solution so they procrastinate, pass the buck, deny the risk


4. panic: so frantic to get rid of the problem they can't deal with it realistically

3 effective reactions when confronted with a decision

1. importance: determine priority of decision



2. credibility: evaluate how much is known



3. urgency: decide how quickly to act

9 common decision making biases


"heuristics"

1. availability bias: use only available info


2. representative bias: over generalizing


3. confirmation bias: seek info to support you


4. sunk cost bias


5. anchoring & adjustment bias: influenced by initial figure


6. overconfidence bias


7. hindsight bias: i knew it all along


8. framing bias: influenced by presentation


9. escalation of commitment: overly invested

advantages of group decision making

1. greater pool of knowledge


2. different perspectives


3. intellectual stimulation


4. better understanding of decision rationale


5. deeper commitment to the decision

disadvantages of group decision making

1. a few people dominate or intimidate


2. groupthink: agreeing for sake of unanimity


3. satisficing: agreeing to get done faster


4. goal displacement: the primary goal is subsumed by a secondary goal

4 characteristics of groups

1. less efficient



2. size affects decision quality



3. may be too confident



4. knowledge counts

participative management

process of involving employees in:


setting goals


making decisions


solving problems


making changes in the organization

group problem solving techniques

brainstorming: for increased creativity



delphi technique: for consensus of experts



computer aided


a. chauffer driven: push button consensus


b. group driven: anonymous networking

organizational/corporate culture

system of shared beliefs and values that develops within an organization and guides the behavior of its members

organizational structure

formal system of task and reporting relationships

4 types of organizational culture

clan: internal focus and values flexibility over stability and control


adhocracy: external focus and values flexibility


market: strong external focus and values stability and control


hierarchy: internal focus and values stability and control

3 levels of organizational culture

1. observable artifacts: physical manifestations of culture



2. espoused values: explicitly stated values and norms preferred by the organization



3. basic assumption: core values of organization

how employees learn culture

1. symbols: object or act the conveys meaning



2. stories



3. heroes: person who embodies values of the organization



4. rites and rituals: ceremonies

importance of culture

1. gives members an organizational identity



2. facilitates collective commitment



3. promoties social system stability



4. shapes behavior by helping employees make sense of their surroundings

Organization perspectives that can increase performance

1. strength perspective: success results when a firm has a strong culture



2. fit perspective: success results when culture fits within firm's business context



3. adaptive perspective: success results when culture helps the firm adapt

Mechanisms for culture change

1. formal statements


2. slogans and sayings


3. stories, legends, and myths


4. leader reactions to crisis


5. role modeling, training, and coaching


6. physical design


7. rewards, titles, promotions, and bonuses


8. organizational goals/ performance criteria


9. measurable and controllable activities


10. organizational structure


11. organizational systems and procedures

organization (Chester Barnard)

system of consciously coordinated activities or forces of two or more people

3 types of organizations

1. for-profit



2. nonprofit



3. mutual-benefit

organization chart

box-and-lines illustration showing the formal lines of authority and organization's official positions

4 common elements of organizations


(Edgar Schein)

common purpose: means for unifying members



coordinated effort: working together



division of labor: work specialization



hierarchy of authority: chain of command

3 more common elements of organization

span of control



authority, responsibility, and delegation



centralization vs decentralization of authority

Organizational design

concerned with designing the optimal structures of accountability and responsibility for the organization to execute it's strategies



1. traditional design


2. horizontal design


3. designs that open boundaries between organizations

traditional organizational designs

1. simple



2. functional



3. divisional



4. matrix

simple structure

for the small firm



authority centralized in single person/flat hierarchy



few rules



low work specialization

functional structure

grouping by similar work specialties

divisional structure

product division



customer division



geographic division

matrix structure

combines functional and divisional chains of command so that there are 2 command structures (horizontal and vertical)

horizontal organizational design

teams are used to improve collaboration and work on shared tasks by breaking down internal boundaries

designs that open boundaries between organizations

hollow: operate with central core, outsourcing functions to outside vendors



modular: outsource pieces of product to outside firms



virtual: internet connected partner for temporary project

contingency design

process of fitting the organization to its environment

4 factors to consider in designing organization's structure

1. environment: mechanistic vs organic



2. environment: differentiation vs integration



3. life cycle



4. link between strategy and structure

Environment: mechanistic vs organic


(Burns and Stalker Model)

mechanistic organization: authority is centralized, tasks and rules are clearly specified, employees are closely supervised



organic organization: authority is decentralized, fewer rules and procedures, employees are encourage to cooperate and respond quickly to unexpected tasks

Environment: differentiation vs integration


(Lawrence and Lorsch Model)

Differentiation: tendency of parts of organization to disperse and fragment



Integration: tendency of parts of organization to draw together to achieve a common purpose

Life Cycle

Birth Stage: non-bureaucratic, when organization is created


Youth Stage: pre-bureaucratic, growth and expansion


Midlife Stage: bureaucratic, growth evolving into stability


Maturity Stage: very bureaucratic, large and mechanistic