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MGT 8803 > Business Strategy Week 1 > Flashcards

Business Strategy Week 1 Flashcards

1
Q

Why is planning important?

A

-gives direction and coordinates everyone in the org
-helps minimize waste and redundancy
-reduces uncertainty by understanding firms external environment
-establishes goals from the firm to the individual
-involves everyone (higher job satisfaction)

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2
Q

What does planning context include?

A

Includes external and internal environment ( managements vision, culture technology, ip)

-general environmental factors
-communities
-suppliers
-customers
-partners and shareholders
-regulators
-competitors

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3
Q

Hierarchy of plans

A

managements plans filter down through strategic, tactical and operational plans.

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4
Q

what is managements main task?

A

planning in managing the firm

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5
Q

the role of planning in managing the firm-planning

A

-defining goals, establishing strategy, developing plans to coordinate activities.

types - strategic, functional tactical

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6
Q

the role of planning in managing the firm-organizing and staffing

A

-determining who what when and where of tasks
-how they’re groups
-who reports to whom
-who makes decisions

-also recruiting, selecting, training and performance evaluation

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7
Q

the role of planning in managing the firm-what is the primary role of management?

A

planning

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8
Q

the role of planning in managing the firm- controlling

A

process of monitoring performance, comparing it with goals and correcting deviations

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9
Q

What is the purpose of strategic plans?

A

broadly guiding and positioning the firm relative to the competition;

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10
Q

functional plans

A

that align the goals and direct the strategic activities of the operating units

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11
Q

tactical/operational

A

plans that specify the details of how the operational goals will be achieved

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12
Q

residual uncertainty

A

uncertainty that remains even after planning

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13
Q

planning through the hierarchy?? need to look this up in the lecture notes

A

-functional structure
-divisional structure

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14
Q

functional plans

A

-business unit level planning
-interrelated across sbu
-shorter planning horizons than corporate and sbu plans but extend beyond fiscal year
-drive budget development and staffing plans
-ex: marketing plans, production plans, capacity plans

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15
Q

what does sbu mean?

A

strategic business unit

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16
Q

tactical/ operational plans

A

-narrow and specific
-allocation of resources to specific tasks
-short planning horizons (timesframes)
ex:
financial budgets
production schedules
staffing schedules
project work plans
more

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17
Q

heirarchical vs flat organizations? which org is more effective in stable and which in dynamic environments?

A

hierarchical organizations have many levels of managers reporting to managers and tend to be effective in stable environments

flat organizations have fewer levels of middle management. they are more effective in dynamic environemnts because decision making is delegated into operating areas

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18
Q

types of managers

A

-senior managers
-middle managers
-supervisors
-sometimes team leaders

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19
Q

types of strategic plans

A

-corporate
-business unit
-functional

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20
Q

competitive parity

A

when firms perform at the same level

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21
Q

competitive disadvantage

A

underperformance realtive to other firms and below industry average

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22
Q

competitive advantage

A

better performance than competitiors in the same industry or industry average
-always relative to competitors

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23
Q

what is business strategy?

A

goal directed actions a firm takes to get better performance than competitors. good strategy enables superior performance

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24
Q

Elements of a Good Business Strategy - competitive challenge

A

basically the challenge a firm must overcome in order to be competitive

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25
Q

Elements of a Good Business Strategy - guiding policy

A

or strategic commitment. specific things that you want to do to achieve a competitive advantage

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26
Q

Elements of a Good Business Strategy - coherent actions

A

set of steps taken to address obstacles to competitive advantage

27
Q

how do goals flow through the organization in traditional goal setting

A

from the top down

28
Q

How should goals be set?

A

using S.M.A.R.T. - specific measurable achievable and time bound
Specific-written in terms of outcomes rather than actions or processes
Measurable and quatifiable
Attainable - challenging but attainable
Relevant- relevant to the situation
Time frames - clear timeframes

29
Q

porter vs mintzberg

A

porter - more methodical and deliberate
mintzberg - strategy emerges overtime as strategic intentions collide with changing market conditions

30
Q

create competitive advantage - cost leadership

A

being the lowest cost producer in an industry

typically produce standardized products and focus on operational excellence

win with price sensitive customers

31
Q

create competitive advantage - differentiation

A

having a unique product in a broad market

-can charge a premium if it creates value

32
Q

create competitive advantage - focus strategy

A

establish cost leadership or differentiation competitive advantage but focused on a narrow market segment
-niche markets can be a good opportunity for this – can you cater to a specific group enough to charge a premium price

33
Q

managements vision

A

managements vision for what the organization will look like in the future

A well crafted vision will be aspirational, motivational; will stretch the capabilities of the organization and create meaningful long term goals

34
Q

mission statement

A

-what does the organization do
-how does the org do things
-what is the commitment to key stakeholders
-what are the core values
-real - not hype

35
Q

criteria for effective vision and mission

A

-supplement vision with actionable picture of future business
-act out the vision mission and core values in everyday behavior
-back up vision and mission with strategic commitments
-use vision and mission to shape strategy

36
Q

core values

A

-guiding principles of the firm

-support companies vision, shape culture and reflect companies identity and personality

37
Q

vision statement

A

-exteranally facing and intended for consumption
-concise aspirational and gives a sense of purpose
-more focused on inspiring than driving strategic goals

38
Q

vision statement vs mission statement

A

vision - aspirations
mission - how the org intends to accomplish vision

39
Q

business model framework ( 3 value)

A

how the components of a business fit together to make a profit

-value delivery
-values creation
-value capture

40
Q

business model framework -value delivery

A

component of business model that is customer facing. we need to deliver value to the customer

41
Q

business model framework -value creation

A

focuses on business operations– how the firm creates value and supports the products and services in a post sales environment
-core competencies

42
Q

Strategic Resources

A

resources important to firms competitive advantages

43
Q

common revenue models

A

retail
transaction
rental/lease
usage
advertising and sponsorships
affiliate marketing
brokerage
subscription/membership
licensing

44
Q

technology fueled new revenue models

A

-transitioning revenue models
-=data driven revenue models
-e-commerce

45
Q

business model - economic model

A

defines the economic logic that is, how the firm captures value. It is comprised of the methods for generating revenues and the cost incurred to capture those revenues.

46
Q

value capture

A

describes how the firm captures the value it is created and delivered
-revenues and expenses
-capital requirements and cost structures

47
Q

cost leader strategy

A

outsourcing non-core activities

being efficient

lowest costs in industry focused on broad market

48
Q

differentiation strategy

A

high quality inputs and outputs

product innovation and performance

higher costs overall

49
Q

focus strategy

A

focus on catering to niche markets

should also differentiate or cost leader focus

focus on unserved or underserved markets
ex: store for left handers

50
Q

traditional top down approach to process models

A

analysis -> formulate -> implement (afi framework)

51
Q

analysis - external analysis

A

environmental trends and actions of industry players that impact the firm’s markets and operations

52
Q

strategic management process- internal analysis

A

he firms resources and business model and fit to the evolving environmental conditions and competitor strategies

53
Q

strategic management process- swot

A

strengths/weaknesses/ opportunities/threats framework to formulate business strategies

54
Q

strategic management process- formulation

A

creation of business processes based on analysis? – need to fix

This activity involves the development of business cases that lay out the economic and strategic reasons for pursuing a particular strategic initiative

55
Q

strategic management process - implementation

A

doing the plans you’ve formulated based on your analysis

-the action stage of the strategic management process

56
Q

limitations of top down approach

A

-assumes future can be accurately predicted (extrapolation)
-based on centralization of authority and decision making with senior management

57
Q

afi framework most common approaches

A
  • traditional, conventional top down approach to strategy development;
  • scenario-based planning, and
  • strategy as planned emergence.
58
Q

3 levels of characterizing knowledge and uncertainty

A

-things we know are true with high degree of probability
-things we can learn with research
-things we are unlikely to be able to learn even with research

59
Q

levels of (residual) uncertainty

A

1 - clear enough future
2 - alternative but well definable futures ( usually choice between 2 futures)
3 - range of potential futures
4 - true ambiguity

60
Q

residual uncertainty

A

things that are unknowable

61
Q

scenario based strategy planning

A

think through multiple scenarios to help you develop a plan. used when data is limited or uncertain

62
Q

scenario based planning steps

A

set the planning scope - frame key issues and establish the horizon

identify key environmental factors that will shape the firms future

select 2-3 key variables and formulate a set of possible outcomes based on them

create teams to “flesh out” each scenario

pick a dominant scenario and create trigger points for alternative scenarios w/ contingency plans

63
Q
A

MGT 8803 (11 decks)

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