Business Acumen & Consultation Flashcards
1
Q
Value
A
- The benefit created when an organization meets its strategic goals
- Is a measure of usefulness, worth, or importance.
- Not the same as values (principles and beliefs)
2
Q
Critical aim for all organizations and business units to function is to
A
- Protect and enhance the value of the organization’s assets
- Financial, people, technological, and physical
- Add new value where possible
3
Q
Assumption behind strategic planning and management
A
Purposeful activity will yield greater value
4
Q
Before strategic planning can begin, organization needs to consider what regarding value
A
- How it creates value
- What activities are critical to the creation, retention, and increase of value
5
Q
Influences on value
A
- Organization’s mission
- Culture at organizational, global and workplace level
6
Q
Value chain
A
- Also called business model
- The process that an organization creates the product or service it offers to the customer
- Involves every activity required to make a good or service and then sell or deliver it
7
Q
Value chain is described as chain because
A
- It represents the sequential and simultaneous contributions of a number of internal and external participants.
- Each participant adds an eliment of value and the total value is more than the sum of the parts and shows the interconnections of various partipants in delivering value to the end customer
8
Q
Primary Activities in Value Chain
A
- May vary due to enterprise’s activity and contribute to the value created.
- May be part of the organization or external. (ex: distributor or retailer)
9
Q
Secondary Activities in Value Chain
A
- Provide essential services to line functions
- Ex: HR
10
Q
HR Contribution to Value Chain
A
- Quality and avaliability of talent pools
- Managing labor supply for productivity.
- Leader and performance development processes.
11
Q
Competitive Advantages through Value Chain
A
Enterprise can achieve competitive advantage by either
- Being superior in one functional area of value chain
- Through effective coordination amoung various functions
12
Q
Global Value Chain
A
- Consists of multiple organizations producting parts of a good or service across geographical regions, with each link on the value chain adding value.
- More integrated than those who outsource production or supply from other countries.
- They must maintain good governance of all chain participants
13
Q
Organizational/Product Life Cycle Stages
A
- Introduction
- Growth
- Maturity
- Renewal/no growth/ decline
14
Q
Organizational/Product Life Cycle Outcomes
A
- Success through renewal
- No-growth existence
- Decline
15
Q
Introduction Stage of Organizational/Product Life Cycle
A
- Revenue (vertical) is low
- Little market awareness
- Market’s resistance to change
- Entrants must create an identity with customers and develop a value proposition (take imagination, business acumen and leadership)
16
Q
Growth Stage Stage of Organizational/Product Life Cycle
A
- Time proceeds (horizontal access)
- Revenue increases
- Rate of growth (steepness of curve) will vary by industry, enterprise or product
- Focus shifts to creating processes that will increase efficiency without stifling innovation
17
Q
Maturity Stage Stage of Organizational/Product Life Cycle
A
- Market is saturated with competitors
- Growth only occurs through introduction of new products or customer groups (starts new cycle for those entrants) or acquistions
- Profit margins become narrower
- Efficiency becomes important.
- Greater formalization and perhaps bureauracy
18
Q
Renewal/no growth/decline Stage Stage of Organizational/Product Life Cycle
A
Eventually demand decreases, either because need no longer exists or it is satisfied more effectively by something or someone new
19
Q
Renewal Stage of of Organizational/Product Life Cycle
A
- Renew themselves completely done by changing their offerings, where they compete or how they compete If they succeed, revenues rise
- Organizations must return to innovative roots
20
Q
No growth Stage Stage of Organizational/Product Life Cycle
A
- Take no action and accept continued low revenue
- As time goes on, organizations and products have few resources to take advantage of opportunities that might deliver growth
21
Q
Decline Stage Stage of Organizational/Product Life
A
Take no action and experience a decline in revenue that will make it impossible to compete or operate
22
Q
Characteristics of the Introduction Stage of the Organizational/Product Life Cycle
A
- Vision, innovation, and energy are critical.
- Little structure and no formal policies.
- There may not be a dedicated HR function
- Could be outsourced or performed by a top manager.
23
Q
Introduction Stage of the Organizational/Product Life Cycle Impact on HR Strategy
A
- Talent acquisition
- Helping to define and create a culture in keeping with the founders’ values.
- Controlling risks associated with human resources
- Ex: Compliance with laws, stress management
24
Q
Characteristics of the Growth Stage of the Organizational/Product Life Cycle
A
- Keen awareness of markets and customers make the difference.
- Managers must be strategically disciplined and maintain focus.
- There are competing demands for innovation and efficiency.
- Requires some degree of formalization of structure and processes without affecting the vibrant culture that brought the organization out of the start-up phase
25
Growth Stage of the Organizational/Product Life Cycle Impact on HR Strategy
* Tactical buildup of talent.
* The right talent must be acquired and/or built in-house.
* Tactical increase in complexity of structure and policies.
* Changes must weigh improvements in efficiency against impact on culture
* Helping leaders redefine their roles and share leadership with others.
* Formalization of job descriptions.
* Managing changes caused by the organization’s growth and increased formalization.
26
Characteristics of the Maturity Stage of the Organizational/Product Life Cycle
* Need for greater control emerges.
* This often results in more formalization and complex reporting and decision-making structures.
* Top management plans; lower-level management implements.
* There can be a loss of connection with the organization’s strategy.
27
Maturity Stage of the Organizational/Product Life Cycle Impact on HR Strategy
* Building and retaining a productive workforce to meet a high level of demand.
* Establishing stable leadership through succession planning.
* Implementing policies.
* Communicating and reinforcing organizational culture in policies and practices.
* Improving channels of communication so that strategy can be understood and aligned at all levels and in all areas.
* Making sure that formalization does not make the organization less agile and innovative.
* Consulting to other parts of the organization to solve problems that affect productivity
* Modeling awareness of external influences. HR can be a champion of environmental scanning.
28
Characteristics of the Renewal Stage of the Organizational/Product Life Cycle
* The organization attempts to reconnect with or find new customers or missions.
* If the organization has become slowed by its size and held back by complex structures and too many policies, it will need to restructure.
* Vision and innovation, strong leadership, motivation, and communication are vital.
29
Renewal Stage of the Organizational/Product Life Cycle Impact on HR Strategy
* Reductions in workforce to right-size the organization as it rebuilds.
* A change in leadership and workforce requirements.
* A streamlining of structures and policies.
* Added responsibilities to job descriptions and remaining staff.
30
Characteristics of the No Growth Stage of the Organizational/Product Life Cycle
* Revenue and workforce remain static or decline.
* Fewer opportunities for employee advancement arise.
* Compensation is static.
31
No Growth Stage of the Organizational/Product Life Cycle Impact on HR Strategy
* Maintaining engaged workforce with fewer resources.
* Dealing with increased turnover rate.
* Delivering HR services with shrinking budget.
32
Characteristics of the Decline Stage of the Organizational/Product Life Cycle
* The organization shrinks in size and assets.
* In-fighting increases.
* There may be a swing back to more autocratic control by leaders.
33
Decline Stage of the Organizational/Product Life Cycle Impact on HR Strategy
* Reducing the workforce size.
* Helping the organization’s members manage constant stress and workplace changes necessary to survive.
* Attracting necessary talent. Reduced assets and prospects demand greater creativity in talent acquisition.
34
Macroenvironment
All the factors that exist outside the organization that could influence the organization's strategic decision
35
Macroenvironmental Factors Include
* Industry and market conditions and behaviors that shape the organization's competitive environment
* Factors that directly affect the core competencies the organization needs to compete
* HR needs to provide the right number of workers with the right kinds of skills
* Events and trends that may affect the present and future availability of talent, compliance requirements and employee needs.
36
Michael Porter’s “Five Forces” Framework Purpose
* Was designed to identify industries that were more likely to be profitable and provide a return on investment
* Based on the premise that every industry (including those in nonprofit and not-for-profit) sectors and its members face similar competitive challenges.
37
Applying Michael Porter’s “Five Forces” Framework
* Reveals subtle information about the dynamic forces within industries.
* Analysis can be used to identify opportunities and threats, foresee possible changes in competitive landscape and plan strategy
38
Porter’s Five Forces Framework Includes
1. Threat of substitution
2. Threat of entry
3. Bargaining power of suppliers
4. Bargaining power of buyers
5. Rivalry among existing competitors
39
Threat of substitution
How easy it is for a competitor to capture customers by offering a similar product or product that satisfies the need but in a different way
40
In a High Level of Threat of Substitution
HR will need to develop strategy to promote cost efficiency
41
If Low Level of Threat to Substitution
Organization has more capital to invest HR may focus on developing an entrepreneurial culture
42
Threat of entry
* How easily a new competitor can enter the industry
* How much capital investment is required
* How much time it generally takes for new entry to become a threat to market share
43
High level of threat to entry
* Management and workforce must be nimble
* HR must examine the organization's structure to support rapid decision making and response
44
Bargaining Power of Suppliers
* How vulnerable are organizations in this industry to the actions of upstream supply chain partners?
* Are there few suppliers or many?
* What would happen if a supplier went out of business or was bought by a competitor?
45
High Bargaining Power of Suppliers
HR must be sure job descriptions include skills such as negotiation and managing risk and competencies such as ethical practice and relationship management
46
Bargaining power of buyers
How vulnerable are organizations to actions by customers looking for the lowest price or large customers who can greatly affect sales and revenue?
47
High Influence of Bargaining Power of Buyers
* Marketing competencies are key
* HR must align compensation practices to motivate marketing and sales toward behaviors important to organization's strategic objectives
48
Rivalry among existing competitors
* All of the other forces have the potential to increase the intensity of competition within the industry.
* A concentration of suppliers or buyers will trigger competition, and the insecurity caused by easy entry into the market and substitution can lead to price-cutting wars and product or service design aimed at locking customers in.
49
Competitive Posture Categorizations
* Weak, tenable, favorable, strong and dominant
* Can be strengthened by taking initiatives
50
HR professionals can improve their awareness of their organization and the environment they operate by
* Regularly reading business press
* Staying current with latest acedmic research
* Analyze the organization's performance
* Monitor the pefromance of other organizations
* Become regular users of third-party information from government agencies
* Sanning annual reports from business groups or comparable markets and workforces
51
HR Networking Within the Organization
* Gives a sense of developing management philosophies, preferences and attitudes
* Relationships with finance - can help explain significance of financial performance metrics
* Stakeholder communities - uncovers emergent issues
* Can serve to build allies for later actions
52
HR Advocacy
* Being an advocate for workplace issues before national and local governments and regulatory bodies.
* Focus on issues that affect the business decisions of major employers and on wage and benefit issues.
* Can help shape developing policies on issues such as the impact of recreational marijuana on the workplace or the burden of education debt on employees.
53
HR Should Be Aware of the Following During the Consulting Model
* Organization's (or individual or group) readiness for change and the members' ongoing emotional response to changes
* They should plan and implement ways to increase acceptance and assimilation of new values and practices
54
Steps of Consulting Model
1. Define the Problem
2. Design and implement solution
3. Measure effectiveness
4. Sustain improvement
55
Define the Problem Step of the Consulting Model
* Gap between desired and actual performance is defined along with possible causes for the gap
* Information that will affect the eventual plan is also gathered
56
Data Gathered from Define the Problem Step of Consulting Model
* Should be collected from all those affected
* Information gathered helps in design of effective and efficient solution
* Stakeholders are involved in designing the solution and will improve eventual implementation (people support what they create)
* Data is sorted and analyzed and reported back to stakeholders in way that helps them understand observations and choose right course of action
57
Consulting Findings in Define the Problem Step of Consulting Model
* Focus on conditions that can realistically be changed
* Based on sufficient and specific evidence that is neutrally presented
* Select few areas for attention, prioritizing data findings by frequency and impact on strategic performance.
58
Problem-Solving Approach during Design and Implementation Step of Consulting MOdel
* Explore the decision to be made fully, so that all influences are understood
* Generate multiple options, define criteria for effective choice but analyze all
* Select best solution and implemnt it
* Evaluate decision and decision-making process when outcomes are clear.
59
Design and Implement Solution Step of Consulting Model
Criteria for an effective solution are defined and appropriate tactic for development is chosen
60
Successful Implementation of the Design and Implement Solution Step of the Consulting Model
Depends on ability to motivate employees during difficult time of adjusting to new conditions or practices.
61
How to motivate employees to adjust to changes during the Implement Solution Step of the Consulting Model
* Providing necessary support (Ex: more time to adapt, new tools, training, skills)
* Communication skills - being alert to verbal and non-verbal messages, provide ample info at right times and giving and seeking feedback
62
Measure Effectiveness Stage of Consulting Process
* Measuring effects of solution to determine if objective of the consultation has been met and if it had the desired strategic impact
* HR effectiveness as consultant is reviewed and plans for improvement is made
* Experiences are monitored and documented for later study
* Problems are identified and addressed
63
Sustain the Improvement Step of the Consulting Process
* New process is monitored to encourage continued effort
* HR gives guidance to leaders to institutionalize and apply new values, attitudes or practices
64
Group Decision Making Tools
* SWOT Analysis
* Multi-Criteria Decision Analysis (MCDA)
* Cost-Benefit Analysis (CBA)
* Force-Field Analysis
65
SWOT analysis as a team
The group can brainstorm strengths, weaknesses, opportunities, and threats and agree on a numerical value for each.
66
Multi-criteria decision analysis (MCDA)
* The team determines critical characteristics of a successful decision
* Ex: ability to meet project requirements, likelihood of success, least chance of causing secondary risks
* A matrix is used to score each alternative and compare results.
67
Cost-benefit analysis (CBA)
Group discussion is critical to identifying all relevant costs and benefits.
68
Force-field analysis
* Used to analyze forces favoring and opposing a particular change
* Group identifies and weighs factors that could influence an outcome in either a negative or positive manner according to their possible impact.
* Group then uses these factors to score different opportunities.
* Group decides to pursue those showing favorably for change and avoid those that face strong resistance
69
Role of HR in Managing Change
* Identify the impact of the change on people and departments
* Assessing the impact of changes across the organization
* Consulting with the organization’s leaders on ways to support the change initiative, including changes in organizational culture , new processes, and investment in learning and development to support employees as they develop new competencies to perform their changed roles.
* Measuring the effectiveness of the change initiative.
* Tracking issues that arise at any point and following up to deliver superior service to HR’s internal customers.
* Using communication skills and channels to contact all affected employees quickly and uniformly and communicate the details of the change initiative.
70
Effective Communication During Periods of Change can Produce
* Identification and mitigation of potential risks.
* Increased employee buy-in and satisfaction.
* Increased trust between management and nonmanagerial employees.
* Identification of needed change-related training initiatives to improve employee skills and proficiency throughout the change process.
* Increased leadership cohesiveness.
71
J Curve
* Change is introduced - decline in performance and then slow return to previous levels
* Effective change that is managed effectively- more rapid growth to new level of performance
* Poorly chosen intervention/management - results in more permanent flattening of curve at plateau
72
Managing the J Curve
Recognizing reactions to change and promptly respond appropriate
73
Employees Resistant to Change
* By fear of the unknown or lack of confidence in their ability to preform new tasks
* May prefer inertia and comfort of the familiar to challenge of learning new roles and skills
74
Employees that Welcome Change
Because they can see immediate benefits (ex: improved communication, more individual control)
75
Employee Reactions to change
* Resist change
* Welcome change
* Waiting for more information to decide
76
What should be done about employees who are resistant to change
* Managers make special effort to listen to employee fears and doubts
* Frequent check in
* Additional resources to help them adapt to new processes or structures
* Managers can emphasize benefits that outweigh the cost of change
* If individual's attitude harms the group, managers may have to emphasis new expectations and employee obligations to meet them
77
What should be done about employees who are receptive to change
Make them champions of change - communicating reasons and enthusiasm to peers
78
What should be done about employees have not committed or rejected change
* Managers should sell both organizational and personal benefits of the change
* Assign the employee tasks or roles to increase level of involvement in the process
79
Difficulties in Global and Diverse Organizations With Change
* Some cultures it is difficult to gather feedback on employee feelings of change
* A trusted insider should be sent to read and communicate with employees in this group
80
How to Assess Readiness for Change
* Nature of the change
* Expected duration
* Key milestones associated with the change
* Location within the change process
* Primary responsible person for implementing the change
* Language and cultural factors impacting the change
* Role HR will play
* Fears regarding the change
* Anticipated resistance
* Plan to deal with temporary drop in productivity
* Established benchmarks
* Local interest and needs during planning and implementation
81
Conditions that Make Change Possible
* Shared purpose
* Reinforcement systems
* Skills required for change
* Consistent role models
82
Lewin’s Model of the Change Process Steps
1. Unfreezing
2. Moving
3. Refreezing
83
Unfreezing Step of Lewin’s Model of the Change
* Unfreeze the current state
* Get people to accept that change will occur
* Focus on reducing factors that work against the change
84
Moving Step of Lewin’s Model of the Change
* Moving toward the new state
* Focus is getting people to accept the new desired state
85
Refreezing Step of Lewin’s Model of the Change
* Refreezing the current state
* Once change has been implemented and generally accepted - focus should be on making the new idea a regular part of the organization
86
Kotter's Eight Contributors to successful implementation of change
1. Create a sense of urgency.
2. Assemble a strong guiding team.
3. Provide a clear vision.
4. Over-communicate.
5. Empower action.
6. Ensure short-term successes.
7. Sustain progress and build on achievements.
8. Institutionalize.
87
Current State (Unfreeze) Stage of Change includes these Kotter's Technique Steps
* Generate sense of urgency
* Assemble strong guiding team
* Provide clear vision
88
Transition (Move) Stage of Change includes these Kotter's Technique Steps
* Over-communication
* Empower action
* Ensure short-term success
89
New State (Refreeze) Stage of Change includes these Kotter's Technique Steps
* Consolidate progress
* Institutionalize
90
Organizational Approaches to Change
* Cascade
* Progressive
* Organic
91
Cascade Approach to Change
* Relies on a top-down sequence with complete change at each level
* Change at one level or unit high up in the organization eventually transforms the units and levels beneath it
92
Progressive Approach to Change
* Change originates at the top and is broadcast to the entire organization
* Individuals slowly change with added information, and change becomes uniform across business units
93
Organic Approach to Change
* Relies on independent centers and multiple origins of change within the organization
* Points of origin can be at any level
* Radiates out unevenly but accelerates when top leadership supports local change and local leaders
