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HCM 407 > Chapter 2 > Flashcards

Chapter 2 Flashcards

1
Q

Societal Environment

A

General economic conditions, population demographics, cultural values, governmental regulations, and technology

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2
Q

Market Structure

A

Organizational characteristics of a market that exert a strategic influence on the intensity and form of competition

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3
Q

Industry:

A

A group of sellers whose products are close substitutes

Pharmaceutical, computer, aviation

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4
Q

Market:

A

A group of both sellers and buyers who exchange goods and services for a price – generally defined by geographical boundaries
A place where there are sellers and buyers exchanging goods and money

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5
Q

Patient Origin Study

A

Percent of total admissions divided by the zip code and sorted from the highest to the lowest percentages

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6
Q

Perfect Competition

A

Many small firms

Undifferentiated, homogeneous product

Few barriers to entry

Consumers are well informed of choices

Organizations compete on the basis of price

Examples: Agricultural commodities (e.g., wheat, rice, corn), generic drugs, gasoline

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7
Q

Monopolistic Competition

A

Many firms

Products are differentiated

Firms have some control on prices

Relatively easy entry and exit

Examples: Restaurants, private physician services, manufacturers of breakfast cereals

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8
Q

Oligopolies

A

Dominated by a few large firms

Offer similar or identical products
Consumers have limited choices; producers are limited in number
Buyers often choose services/products on the basis of location or personal preference

Focus their strategies on capturing market share

High barriers to entry and exit

Examples: Tertiary hospitals, healthcare insurance companies, airline, steel, automobile, oil, tire, and beer companies

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9
Q

Monopolies

A

One firm

Limited product options

Competition is almost nonexistent, so strategic efforts made to maintain entry barriers and keep out competition

Can influence higher prices

Examples: Rural hospitals, new drugs under patent, utility companies, the National Football League

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10
Q

Herfindahl-Hirscham Index (HHI)

A

Calculated by squaring the market share percentage of each organization in a market and then summing the numbers

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11
Q

Four-firm concentration ration

A

Caluculated by adding the market shares of the four largest organizations in a market to fingd their cumulative total output

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12
Q

Medical technology

A

The procedures, equipment, and processes used to deliver medical care.

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13
Q

Product Life Cycle

A 
Most products and services go 
through phases or a life cycle 
that relate to the rate of sales, 
number of firms in the market, 
and consumer demand.
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14
Q

Growth Stage

A

Best stage for an organization to enter a new market
Competition is relatively low, customers are more forgiving, greater profits can be obtained
Standards set
Economies of scale
Greater customer acceptance

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15
Q

Maturity Stage

A 
Consolidation begins
Price competition
Flat sales
Lower profits 
Managing costs is key
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16
Q

Decline Stage

A 
Demand for product decreases
Changing consumer preferences
Technological obsolescence
More effective substitutes
Consolidation
As demand drops, overcapacity leads organizations to exit the market or merge, leaving a smaller number of competitors
Cost and price competition dominate
17
Q

Emerging Markets

A

Difficult environment for organizational growth
Sales are limited – customers lack adequate product knowledge
Inducements to try product are common
Few standards
Product quality is uneven
Generally poor profits
Companies face a substantial risk of product failure

18
Q

Operating Environment

A 
General economic conditions
Population demographics
Cultural values
Political/Legal
Technological
19
Q

Industry

A 
New competitors
Substitute products
Power of suppliers
Power of buyers
Competitive rivalry
20
Q

Market

A 
Growing, shrinking
Size of markets
New markets
Market structure
Product life cycle
21
Q

Competitors

A

Who they are
Strengths, Weaknesses
Strategies
Objectives

22
Q

Broad differentiation strategy

A

A type of strategy aimed at offering products that consumers perceive to be distinct from competitors’ products and that appeal to a wide segment of a market

23
Q

Broad low-cost strategy

A

A type of strategy aimed at providing low-cost products to a broad customer segment

24
Q

Business model

A

The underlying structure of an organization; the means through which an organization creates and delivers value to its customers and earns revenue

25
Q

Customer Value

A

The perceived benefits of a product or service. Consumer may find value in many aspects of products and services, including range and type, degree of customization, availability and accessibility, and quality/cost trade-off.

26
Q

First Movers

A

Organizations that are the earliest to enter a market or an industry

27
Q

Focused differentiation strategy

A

aimed at offering products that consumers perceive to be distinct from competitors’ products and that appeal to a limited industry niche or customer segment

28
Q

Focused factories

A

manufacturing strategy that concentrates on core products and defined set of technologies and customers

29
Q

Focused low-cost strategy

A

strategy aimed at providing low-cost products to a limited subset of the broad mass market

30
Q

Generic Strategies

A

Commonly used strategies that combine a target market and a type of differentiation

31
Q

Inputs

A

The combination, type, and mix of resources an organization uses to provide a product or service, such as personnel; materials; and strategic assets such as facilities, equipment, location, patents, networks, and partnerships

32
Q

Isomorphic

A

The tendency of organizations in a market to become similar in form and structure, offer similar products, and adopt similar practices over time

33
Q

Middle strategy

A

A strategy that seeks to deliver low-cost and differentiation simultaneously

34
Q

Portfolio analysis

A

A method of assessing an organization’s products or SBU’s that considers various factors, including competitive position, profitability, growth, and mission importance

35
Q

Process

A

A series of steps that transforms inputs into products/services. Process usually are established to organize functions and interface with external entities

36
Q

Profitability

A

The degree to which the revenues generated by a product or service exceed the costs of producing that product or service

HCM 407 (1 decks)

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