Chapter 1 Flashcards
What is an ecosystem?
Network of organisations
What is a strategy?
Course of action to achieve a specific objective
What is a corporate strategy?
Organisation as a whole
e.g. Group
What is a business strategy?
How business operates in individual markets
e.g. division
What is a functional strategy?
Day to day management
e.g. individual BU
What is the rational model?
Step-by-step approach
Analysis > Choice > Implementation
What is the emergent approach?
Strategies in response to unexpected events
What is logical incrementalism?
Small scale extension of past policy
What is freewheeling opportunism?
Take advantage of opportunities as they arise
What two strategies require formal planning?
Rational model
Emergent
What two strategies require no formal planning?
Incrementalism
Freewheeling
Where does rational model and emergent strategies exist?
Stable markets
Relatively inexperienced managers
Where does incrementalism and freewheeling strategies exist?
Dynamic, fast changing industries
Experienced managers
Don’t need external finance
Why is incrementalism not good for new organisations?
They have no past strategies upon which they can base their future policies
Whats the three E’s approach for not-for-profit organisations?
Economy - level of inputs
Efficiency - link between inputs and outputs
Effectiveness - Look at outputs
What are the three approaches to strategic planning?
Traditional - looks at stakeholders
Market led or positioning - market and competitor actions
Resource based - What firm is good at
What is strategic management accounting?
Emphasis placed on information which relates to factors external to the entity
Strong external focus
Forward looking
What information is provided by strategic management accountants?
Competitor analysis
Pricing decisions
Customer profitability
Evaluation of brand value
How does SMA’s help the business?
More effective strategic planning
Increased awareness of business and environment
Increased control over business performance
Better decisions making
