Chapter 4 Basics of Stratgic Planning Flashcards
What are the steps of the formal planning steps?
- Situational analysis
- Alternative goals and plans
- Goal and plan evaluation
- Goal and plan selection
- Implementation
- Monitor and control
What are the steps of the general decision-makin stages?
- Identifying and diagnosing the problem
- Generating alternative solutions
- Evaluating alternatives
- Making the choice
- Implementation
- Evaluation
Goals should be?
Specific Measureable Attainable Relevant Time-bound
What happens in step 3 of the formal planning steps?
Goal and plan evaluation
Evaluate the advantages, disadvantages, and potential effects of each alternative goal and plan.
What happens in step 4 of the formal planning steps?
Goal and plan selection
Select the goals and plans that is the most appropriate and feasible. Identify the priorities and trade offs among the goals and plans
What is strategic planning?
Involves making decisions about the organization’s long term goals and strategies
What are strategic goals?
Typical strategic goals include growth, increasing market share, improving profitability, booting return on investments, fostering both quantity and quality of outputs, increasing productivity, improving customer service, and contributing to society
What is a strategy?
pattern of actions and resource allocations designed to achieve the goals of the organization.
What is tactical planning?
Focuses on the major actions the unit must take to fulfill it’s part of the strategic plan.
Often a functional area lie marketing or HR
What is operational planning?
Identifies the specific procedures and process required at lower level of the organization.
A method for aligning the organization’s strategic and operational goals?
Strategy map
Four key drivers of a strategy map:
- The skills of its people and their ability to grow and learn
- The effectiveness of its internal processes
- Its ability to deliver value to customers
- Ultimately its ability to grow its financial assets
What is strategic management?
Involves managers from all parts of the organization in the formulation and implementation of strategic goals and strategies
Strategic management six major process components:
- Establishment of mission, vision, and goals
- Analysis of external opportunities and threats
- Analysis of internal strengths and weaknesses
- SWOT (Strengths, weaknesses, opportunities, and threats) analysis and strategy formulation
- Strategy implementation
- Strategic control
What is the difference between a mission and strategic vision?
Mission is a clear and concise expression of the basic purpose of the organization as it currently operates while the strategic vision evolves from the mission and points to the future
What are a companies resources?
- Tangible assets such as real estate, productions facilities, raw materials
- Intangible assets such as company reputation, culture, technical knowledge, and patents as well as accumulated learning and experience
What is a companies core capabilities?
Typically refers to a set of skills or expertise in some activity rather than physical or financial assets
EX: Honda has a core competency in small engine design and manufacturing
What is benchmarking?
Is the process of assessing how well one company’s basic functions and skills compare with those of another company or set of companies.
Internal benchmarking the same thing however with comparing departments against each other within a company
What does basic SWOT look like?
Strengths:
- Effective sales and marketing
- User-friendly software
- Relatively low price
Weaknesses:
- Experience limited to smaller companies
- Need to prove capabilities for larger customers
Opportunities:
- Geographical expansion
- More markets
- New services (data discovery)
Threats:
- Large vendors with similar software
- Pressure on price
- Possibility of software becoming standard
What is corporate strategy?
Identifies the set of businesses, markets, or industries in which the organization competes and the distribution of the resources among those businesses
What is concentration strategy?
Focuses on a single business competing in a single industry
EX: Food retailing
What is vertical integration strategy?
involves expanding the domains of the organization into supply channels or to distributors
What is concentric diversification?
Involves moving into new businesses at are related to the company’s core business
What is conglomerate diversification?
A corporate strategy that involves expansion into unrelated businesses
Businesses with high-growth with weak competitive position are called?
Question mark
Businesses with high-growth and strong competitive position are called?
Stars
Businesses with low-growth and a strong competitive position are called?
Cash Cows
Businesses with low-growth and a weak competitive position are called?
Dogs
What is a business strategy?
Defines the major actions by which an organization build and strengthens its competitive position
What is a low-cost strategy?
Attempt to be efficient and offer a standard, no frills product (Walmart)
What is functional strategy?
Implemented by each function area of the organization to support the business strategy.
Functional areas:
- Production
- Human resources
- Marketing
- Research and development
- Finance
- Distribution
What is the strategic control system designed for?
To support the manager in evaluating the organization’s progress with its strategy and, when discrepancies exist, taking corrective action
