Area 1: Leadership and Strategy Flashcards
Vision Statement
An inspiring, concise statement of what a company is, who it serves, and where it is going. For all stakeholders.
Mission Statement
A statement that elaborates on a vision statement by providing additional details about how the organization plans to achieve its vision of the future. For employees, generally.
Core Competency
A specific function that a firm regards as central to its success and is something difficult for competitors to imitate.
Middle-out Approach
Each business unit has its own goals/practices that contribute to organizational goals. (Specifically in terms of CSR this is effective)
Personnel Department
The dreaded forerunner of the HR department. Hiring, firing, payroll, training.
Corporate Values Statement
A statement issued by executives at a company to employees that indicates how business should be conducted within that organization.
Code of Ethics
A formal set of principles designed to guide an organization’s decision-making in an ethical manner.
Code of Conduct
A set of rules and regulations that define what is and is not acceptable behavior for employees of a company.
Corporate Citizenship
Actions taken by a company that demonstrate its commitment to issues that affect the surrounding local and global communities.
Corporate Social Responsibility
A company’s commitment to protecting the physical environment and the people who live in the communities where it operates. Sustainability and Social.
Line Manager
An individual with responsibility for directly managing individual employees or teams.
Stakeholders
All the groups affected by the actions of an organization, including stockholders, management, employees, and members of the surrounding community.
Advisory Role
The most recognizable responsibilities of an HR manager is to gather information about issues, diagnose any problems, and offer advice on how best to resolve disputes, such as which course of action to take when confronted with a disciplinary matter, performance problem, or grievance.
Service Role
HR managers also perform activities that serve an organization’s staff departments. These activities include recruiting, training, record keeping, and reporting, all of which can be provided more effectively when handled through a centralized human resource department.
Control Role
HR managers are in charge of establishing important policies and procedures that affect several aspects of employment. These policies and procedures affect compensation, safety, equal employment opportunity, and labor relations. HR staff serve as representatives for senior management by monitoring compliance with these policies.
HRM
Human Resources Management
CSR
Corporate Social Responsibility
LEED
Leadership in Energy and Environmental Design
Strategic Planning
The outlining of the purpose, strategic goals, and performance expectations for an organization.
Strategic Alignment
The process of making sure that all the operating functions of a business are working in support of the business’s overall strategy.
Organizational Audit
(David Ulrich) A comprehensive review of the company’s assets, policies, and practices that focuses on six areas: company mindset, competence, performance or consequence, governance, capacity for change, and leadership.
SWOT
A strategic planning tool used to evaluate the Strengths, Weaknesses, Opportunities, and Threats facing an organization.
PEST
An analysis that is often performed as part of a SWOT analysis. The acronym stands for political, economic, social, and technological, which describe all factors that will determine what threats and opportunities an organization faces.
Five Forces
(Michael Porter) Theory that five basic forces determine the competitive dynamics in an industry: the threat of new entrants; the threat of substitutes; the bargaining power of customers; the bargaining power of suppliers; and industry rivalry.
Imperfect Competition
Having the fewest competitors possible Barriers to entering and exiting the market Numerous suppliers and buyers Asymmetric information Heterogeneous products
Perfect Competition
Many competitors Few barriers to entry Limited suppliers/buyers Homogeneous information Homogeneous products
Three Grand Strategies
Cost Leadership
Differentiation
Focus/Niche Strategy
Cost Leadership
Successful execution of cost leadership occurs when an organization is able to sell its product or service at a lower cost. Not only must buyers perceive the product or service to be comparable or better than rival products, but it must also be sold at a significantly lower price. Cost leadership is often achieved through technological innovations and low-cost labor.
Differentiation
High-quality products, extraordinary customer service, innovative designs, technological capability, and positive brand image are a few ways for an organization to achieve differentiation. Instead of providing a product at the lowest possible price, an organization will use its product’s uniqueness to justify a higher price. An automaker, for instance, may differentiate itself by emphasizing the features and technological innovations that make its cars safer than others. Buyers value unique products and services, and the attribute(s) with which a business chooses to differentiate itself must be significant to justify its price premium.
Focus/Niche Strategy
Businesses that utilize this strategy aim for either a cost advantage or differentiation advantage within a narrow, clearly defined segment of a particular industry. This strategy is also known as a niche strategy since the focus can be on a specific product or buyer, a defined distribution channel, or a particular location. Success will depend on how well the organization appeals to specific consumers and how narrow the market segment is. An unnecessarily small segment will limit the number of potential buyers and reduce the opportunity for a differentiation advantage.
Four Strategic Types
(Miles & Snow) Prospector Defender Analyzer Reactor
Prospector
Four Strategies - This strategy is suited for managers who prioritize innovation, risk-taking, and growth. The prospector does well in environments where creativity is more important than efficiency. Researchers argue that it tends to produce the greatest revenue growth.
Defender
Four Strategies - Managers who utilize the defender strategy are more concerned with stability, control, and internal efficiency. Rather than focus on innovating and growing the company’s customer base, this strategy prioritizes retaining a steady number of customers with high-quality products. While not suitable for every environment, managers should consider this strategy in times of uncertainty or decline.
Analyzer
A compromise between the prospector and defender strategies, the analyzer strategy focuses on stability but still devotes a small number of resources to innovation. While some products will be efficiently targeted towards stable environments, other products will focus on dynamic environments with opportunities for growth. Researchers argue that this strategy is the most profitable and viable, as it most often produces a sustained competitive advantage. Generally large companies
Reactor
Although it is actually less of a strategy than a description of how an organization responds to its environment, the reactor strategy is best when specific goals haven’t been stated, and top management fails to provide a long-term plan. The organization makes decisions based on the immediate needs at the time to produce the fastest results. For these reasons, the reactor strategy is often unsuccessful and should be avoided.
Organizational Chart
Shows who reports to whom
Hiring Schedule
Shows when and what employees will be needed, especially as organizations navigate change and diversification.
HRIS
Human Resource Information System
