Chapter 2: The External and Internal Environments Flashcards
Acquisition
One firm buying another.
Barriers to Entry
Conditions that prevent new companies from entering an industry
Benchmarking
The process of comparing an organization’s practices and technologies with those of other companies
Buffering
Creating supplies of excess resources in case of unpredictable needs
Competitive Environment
The immediate environment surrounding a firm; includes suppliers, customers, rivals, and the like
Competitive Intelligence
Information that helps managers determine how to compete better
Cooperative Strategies
Strategies used by two or more working organizations working together to manage the external environment
Defenders
Companies that stay within a stable product domain as a strategic maneuver
Demographics
Measures of various characteristics of the people who make up groups or other social units
Diversification
A firm’s investment in a different product, business, or geographic area
Divestiture
A firm selling one or more businesses
Domain Selection
Entering a new market or industry with an existing expertise
Empowerment
The process of sharing power with employees, thereby enhancing their confidence in their ability to perform their jobs and their belief that they are influential contributors to the organization
Environmental Scanning
Searching for and sorting through information about the environment
Environmental Uncertainty
Lack of information needed to understand or predict the future
External Environment
All relevant forces outside a firm’s boundaries, such as competitors, customers, the government, and the ec
Final Consumer
Those who purchase products in their finished form
Flexible Processes
Methods for adapting the technical core to changes in the environment
Forecasting
Method for predicting how variables will change the future
Independent Strategies
Strategies that an organization acting on its own uses to change some aspect of its current environment
Inputs
Goods and services organizations take in and use to create products or services
Intermediate Consumer
A customer who purchases raw materials or wholesale products before selling them to final customers
Macroenvironment
The general environment; includes governments, economic conditions, and other fundamental factors that generally affect all organizations
Merger
One or more companies combining with another
Open Systems
Organizations that are affected by, and that affect, their environment
Organizational Climate
The patterns of attitudes and behavior that shape people’s experience of an organization
Organizational Culture
The set of important assumptions about the organization and its goals and practices that members of the company share
Outputs
The products and services organizations create
Prospectors
Companies that continually change the boundaries for their task environments by seeking new products and markets, diversifying and merging, or acquiring new enterprises
Scenario
A narrative that describes a particular set of future conditions
Smoothing
Leveling normal fluctuations at the boundaries of the environment
Strategic Maneuvering
An organization’s conscious efforts to change the boundaries of its task environment
Supply Chain Management
The managing of the network of facilities and people that obtain materials from outside the organization, transform them into products, and distribute them to customers
Switching Costs
Fixed costs buyers face when they change suppliers
