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31 - OBHR 4P94 > Chapter 1 - Strategic Management > Flashcards

Chapter 1 - Strategic Management Flashcards

1
Q

What is Strategy?

A

formulation of organizational objectives, competitive scopes and the action plan to achieve advantage

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2
Q

What is emergent strategy?

A

The plan that changes incrementally due to environmental changes

Rather than a straight path to a goal, this strategy calls for a series of actions to react to competitor actions or changes in legislation

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3
Q

What is the difference between intended strategy and realized strategy?

What is the discarded strategy?

A

Intended is the formulated plan

realized is the implemented plan

Discarded is deemed inappropriate due to changing circumstances.

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4
Q

What is strategic management?

What must good strategic management do?

A

The set of decisions and actions that result in the formulation and implementation of plans designed to achieve a company’s objectives.

To be effective strategic management anticipates future problems, provides an alignment with external contingencies and internal competencies, recognizes multiple stakeholders, and is concerned with measurable performance

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5
Q

What are some triggering events that may stimulate a change in strategy?

A
  1. New CEO: may challenge underlying assumptions and the status quo
  2. Threat of change of ownership: may cause a reconsideration of the effectiveness of the strategy
  3. External intervention: Customer accounts defecting; or serious complaints
  4. Performance gap: sales or profit targets are not being met, the strategy will be reviewed
  5. Strategic inflection point: rapid changes in technology will trigger a change in strategy
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6
Q

What is Human resource planning?

A

Human Resource planning translates the organization’s overall goal into the number and types of workers needed to meet those goals.
> the process of anticipating and providing for the movement of people into, within, and out of an organization.

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7
Q

What is strategic Human Resource planning? Why is it important?

A

Strategic human resources management (SHRM) combines strategic planning and HRP. It can be thought of as the pattern of human resources deployments and activities that enable an organization to achieve its strategic goals

There is a growing acknowledgment that the strategic management of people within organizations affects important organizational outcomes such as survival, profitability, customer satisfaction levels, and employee performance.

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8
Q

What are corporate strategies? What are the 3 main types?

A

Company-wide strategies, sometimes referred to ascorporate strategies, are focused on overall strategy for the company and all of its businesses or interests

Three Main types of Corporate Strategies are :
Restructuring Strategies
Growth Strategies
Stability Strategies

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9
Q

What are restructuring strategies? what are the types?

A

When an organization is not achieving its goals, corporate strategy becomes dealing with the problem. By:

> Turnaround strategy:
An attempt to increase the viability of an organization. Getting rid unprofitable products; imposing layoffs; efficiencies; re-positioning

> Divestiture:
The sale of a division or part of an organization. Example: HBC devesting Zellers to target

> Liquidation:
The termination of a business and the sale of its assets. closure and auction. Happened to radio shack

> Bankruptcy:
When a company can no longer pay its debts. A formal procedure in which an appointed trustee in bankruptcy takes possession of a business’s assets and disposes of them in an orderly fashion.

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10
Q

Briefly explain the turnaround at Mcdonalds

A

McDonald is successful through a number of different strategies to re position and stay viable.

To give healthier choices:
> 2003 > salads 
> 2006 > snack wraps
> 2010 > real fruit smoothies, frappes
> switched to trans fat free oil and a food an easily accessible nutrition info
Regional food 
> Mcarabias
> shogun burgers
> mcchawarmas
> bulgogi burgers
> McSpicy Paneer

diversify:
> 2009 > high margin coffee

adapting to recession
> low dollar menu options

menu creep adapted

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11
Q

What are growth strategies?

A

Corporate strategy seeking growth in revenues, sales, market share, customers, orders, etc

Incremental growth:
Can be attained by expanding the client base, increasing products/services, changing the distribution networks, or using technology

International growth:
Seeking new customers or markets by expanding internationally is another growth option

Acquisition:
The purchase of one company by another

Merger:
Two organizations combine resources and become one

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12
Q

What methods does Procter and Gamble use for incremental growth?

A

> expanding the client base with new products
Increasing the products in the product mix
changing distribution networks
using technology to manage JIT customer purchasing

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13
Q

What are Maintenance strategies?

A

Corporate strategy where companies do not wish to see their companies grow and so their strategic HRM practices remain constant.

> Status quo: do not wish to see their companies grow; content to keep market share; doing what it has been doing
Do-nothing: don’t do anything different; make no changes
Pause and proceed with caution: temporary strategy until environmental conditions are more favourable for growth
Harvest: choose to milk the investment as current profitable situation will not last forever

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14
Q

What are business strategies?

A

Business strategyfocuses on one line of business (in a diversified company or public organization), while corporate strategy examines questions about which competitive strategy to choose as a multi-business corporation.

> Plans to build a competitive focus in one line of business
How to build a strong competitive position
By offering products or services at lower prices/predatory prices

> By creation of sub brands

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15
Q

What are the steps in the strategic planning process?

A
  1. Establish the mission, vision, and values. > Who are we?
  2. Develop objectives. > Where do we want to be?
  3. Analyze the external environment. > What may change?
  4. Identify the competitive advantage. > What is our advantage?
  5. Determine the competitive position. > How can we compete?
  6. Implement the strategy. > what programs will result in success?

7, Evaluate the performance. > How will we measure success?

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16
Q

What is step 1 of the strategic planning process? What re the key components of this step?

A
  1. Establish the mission, vision, and values. > Who are we?

Mission statement:

Vision statement:

Values:

17
Q

What is a mission statement?

A

Mission statement:
An articulation of the purpose of the organization and the value it creates for customers
What do we do?, Whom do we serve?, How do we serve them?

Example: Enhancing stakeholder value and building leading businesses, by maximizing our resources and living our values and principles. (Cara’s)

18
Q

What is a vision?

A

Vision statement:
The basic beliefs that govern individual and group behavior in an organization

What are our hopes and dreams?, What problem are we solving for the greater good?, Who and what are we inspiring to change?

example: To be Canada’s leading integrated restaurant company (Cara’s)

19
Q

What are Values? What purpose does the articulation of values serve?

A

Values:
The basic beliefs that govern individual and group behavior in an organization

> coveys a sense of identity for employees
generates employee commitment to something other than themselves
adds to the stability of the organization as a social system
Serves as a frame of reference for employees to use to make sense of organizational activities
to use as a guide for appropriate behavior

20
Q

What is the second step in the strategic planning process?

A
  1. Develop objectives. > Where do we want to be?

The management team develops short-term objectives to realize its high-level mission, vision, and value .
Objectives are an expression, in measurable terms, of what an organization intends to achieve
Goals can be classified as hard or soft

21
Q

What is the balanced scorecard?

A

for use in developing objectives.

The Balanced Scorecard is a management tool that provides stakeholders with a comprehensive measure of how the organization is progressing towards the achievement of its strategic goals.

It divides organizational strategy into four perspectives
> financial, customer, learning and growth, internal business process

22
Q

What is the third step in the strategic planning process?

A
  1. Analyze the external environment. > What may change?

Managers must be aware of threats and opportunities in the external environment

By scanning and monitoring technology, laws and regulations, the economy, sociocultural factors, and changing demographics, managers can make reactive and proactive changes to the strategic plan

23
Q

What is the fourth step in the strategic planning process?

A
  1. Identify the competitive advantage. > What is our advantage?

The characteristics of a firm that enable it to earn higher rates of profit than its competitors

Resources that allow firm to perform more effectively or efficiently than competitors fall into three categories

  1. Tangible assets:
  2. Intangible assets:
  3. Capabilities
24
Q

What are tangible assets?

A

relating to step 4. Identify the competitive advantage.

  1. Tangible assets: future economic resources that have substance and form from which an organization will benefit. land, inventory, building, location, cash, tech
25
Q

What are intangible assets?

A

relating to step 4. Identify the competitive advantage.

  1. Intangible assets: future economic resources that have been generated from past events. they lack substance and form. human capital, reputation, goodwill, trust, copyright
26
Q

What are capabilities?

A

relating to step 4. Identify the competitive advantage.

  1. Capabilities: A complex combination of people and processes that represent the firms capacity to exploit resources that have been specially integrated to achieve a desired result. Managerial, innovation, marketing, organizational cultures
27
Q

What is VRIO?

A

relating to step 4. Identify the competitive advantage.

The resources based view suggests that for resources and capabilities to provide sustained competitive advantage they must meet four criteria

  1. V - Valuable (help generate value/reduce cost)
  2. R - Rare (competitors dont have them)
  3. I - Inimitable (they can’t be easily copied)
  4. O - Organized (the can exploit them)
28
Q

When do resources and capabilities become core competencies? What are these?

A

When the they serve a competitive advantage.

Core competencies: Organizational resources and capabilities that serve as a firm’s competitive advantage

they can be leveraged. for example amazon developed a competency selling books on the internet. it leveraged this to develop other products

29
Q

What are Dynamic capabilities?

A

Dynamic capabilities: The ability to adapt and renew competencies in accordance with a changing business environment

30
Q

What is the 5th stage in the strategic planning process?

A
  1. Determine the competitive position. > How can we compete?

Based in the information attained the company must create a Value proposition: A statement of the fundamental beliefs of the products or services being offered in the marketplace

31
Q

What are porters 5 generic strategies?

A

Relating to 5. Determine the competitive position. > How can we compete?

Michael Porter made a major contribution to the field of strategic management by grouping the ways organizations can compete into five generic competitive strategies

  1. Low-cost provider strategy. Provide a product or service at a price lower than competitors while appealing to a broad range of customers. e.g. Fast food businesses
  2. Broad differentiation strategy. to appeal to a wide range of buyers. e.g. burger king for Whopper with Frillls for an extra $
  3. Best-cost provider strategy. Give customers more value for money by low cost with upscale differentiation. e.g. low cost product or service with upscale differentiation
  4. Focused or market niche strategy based on lower cost product to a select group of customers– Red Lobster
  5. Focused or market niche strategy based on differentiation – customized services to a niche
32
Q

What is the 6th step in the strategic planning process?

A
  1. Implement the strategy. > what programs will result in success?

> Strategy implementation:
The process by which a strategy is put into action

> uses a Program:
Outlines the steps or activities necessary to accomplish the goal

> with Procedures:
The steps required to get the job done

33
Q

What is the 7th step in the strategic planning process?

A

7, Evaluate the performance. > How will we measure success?

The successful implementation of a strategy is judged by the ability to meet financial targets such as profits, and the ability to meet benchmarked ratios of efficiency and effectiveness

see the balanced scorecard

34
Q

What are the benefits of strategy formulation?

A 
Clarity
 Coordination
 Efficiency
 Incentives
 Adjustment to Change
 Career Development
35
Q

What errors can occur when organizations do not see the benefits of strategic planning?

A

Relegating the process to official planners, and not involving executives, managers, and employees, resulting in no buy-in

Failing to use the plan as the guide to making decisions and evaluating performance

Failing to align incentives and other HR policies to the achievement of the strategy

31 - OBHR 4P94 (13 decks)

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