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MAN3025 > Chapter 6 > Flashcards

Chapter 6 Flashcards

1
Q

a large-scale action plan that sets the direction for an organization

A

strategy

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2
Q

a process that involves managers from all parts of the organization in the formulation and implementation of strategies and strategic goals; involves middle managers

A

strategic management

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3
Q

“building blocks” of competitive advantage

A
  1. responsiveness to customers
  2. innovation
  3. quality
  4. efficiency
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4
Q

the world’s leading expert on competitive strategy; emphasized the importance of not confusing tactics with strategy

A

Michael Porter

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5
Q

when a company attempts to achieve competitive advantage by preserving what is distinctive about it

A

strategic positioning

ex: Walmart & Target

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6
Q

when a firm is engaged in _______ positioning, it produces a subset of an industry’s products or services

A

variety-based positioning

ex: Southwest Airlines focuses on point-to-point

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7
Q

when a firm attempts to serve most or all of the needs of a particular group of customers

A

needs-based positioning

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8
Q

serving the broad needs of a few customers
ex: Bessemer only caters to a handful of wealthy customers

serving the differing needs of similar customers
ex: IKEA

A

two approaches to needs-based positioning

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9
Q

when a firm segments customers who are accessible in different ways, rather than on actual differences between them

ex: Carmike Cinemas serves customers in small markets of fewer than 200,000

A

access-based positioning

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10
Q

few needs, many customers

A

variety-based

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11
Q

broad needs, few customers

A

needs-based

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12
Q

broad needs, many customers

A

access-based

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13
Q

when a strategy aligns with an organization’s activities to reinforce one another in a strategic fit

A

virtuous circle

ex: SW Airlines

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14
Q

difference between operational efficiency and strategy

A

operational efficiency is performing tasks better than your competitors

strategy is a plan for competing in the market

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15
Q

the strategic management process

A
  1. determine a mission and vision
  2. determine the grand strategy
  3. generate strategic plans
  4. execute the strategic plan
  5. maintain control over the strategy
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16
Q

explains how an organization will accomplish its mission

A

grand strategy

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17
Q

a grand strategy that involves expansion - as in sales revenues, market share, number of employees, etc.

A

growth strategy

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18
Q

a grand strategy that involves little or no significant change

A

stability strategy

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19
Q

a grand strategy that involves the reduction of an organization’s efforts

A

defensive strategy

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20
Q

a strategic planning tool that involves the search for strengths, weaknesses, opportunities, and threats affecting the organization

A

SWOT analysis

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21
Q

refers to internal skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its mission

A

organizational strengths

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22
Q

refers to the internal drawbacks that hinder an organization in executing strategies in pursuit of its mission

A

organizational weaknesses

23
Q

refers to the environmental factors that the organization may exploit for competitive advantage

A

organizational opportunities

24
Q

refers to the environmental factors that hinder an organization’s achievement of competitive advantage

A

organizational threats

25
Q

a vision or projection of the future, used by managers to determine strategies going forward

A

forecast

26
Q

a hypothetical extension of a past series of events into the future

A

trend analysis

27
Q

the creation of alternative hypothetical, but equally likely, future conditions

A

contingency planning (or scenario planning/analysis)

28
Q

Porter’s Model for Industry Analysis

A
  1. threat of new entry: new competitors take customers away from existing organizations
  2. suppliers’ bargaining power: the more concentrated the industry, the greater the bargaining power of suppliers
  3. buyers’ bargaining power: buyers have more power when there is a relatively small numbers of buyers in the market
  4. threats of substitute products: a firm faces more competition when there are more available substitutes for its products and services
  5. competitive rivalry: firms in industries with more competitors tend to be less profitable
29
Q

Porter’s 4 Competitive Strategies

A
  1. cost-leadership strategy (wide)
  2. differentiation strategy (wide)
  3. cost-focus strategy (narrow)
  4. focused-differentiation strategy (narrow)
30
Q

strategy that is used to keep costs, and hence prices, of a product or service below those of competitors and to target a wide market

ex: Walmart

A

cost-leadership strategy

31
Q

strategy that is used to offer products or different services that are of unique and superior value compared to those of competitors and to a wide market

ex: Apple, Target, Coca-Cola

A

differentiation strategy

32
Q

strategy that is used to keep the costs, and hence prices, of a product or service below those of competitors and to target a narrow market

ex: store that produces low-end products

A

cost-focus strategy

33
Q

strategy that is used to offer products or services that are of unique and superior value compared to those of competitors and to target a narrow market

ex: IKEA

A

focused-differentiation strategy

34
Q

when a company makes and sells only one product within its market

(advantage is focus, increased competition is risk)

A

single-product strategy

35
Q

when a company operates several businesses to spread out the risk

A

diversification strategy

36
Q

occurs when an organization, under one ownership, operates several unrelated businesses

ex: GE, Virgin

A

unrelated diversification

37
Q

occurs when an organization operates, under one ownership, several separate businesses that are related to one another

ex: Pepsi; beverages and snacks

A

related diversification

38
Q

making products that involve the same type of management, capital investment, production, or have similar sources of risk

A

resource allocation

39
Q

making products that have similar key success factors, are in similar stages of the industry life cycle, or occupy similar competitive positions

A

strategy formulation

40
Q

making products that have targets defined in similar performance variables

A

performance management

41
Q

allocation, strategy formation, and performance management

A

factors that may influence a decision to use related diversification

42
Q

a means of evaluating business units based on growth rate and market share

A

The BCG Matrix

43
Q

____ are in a high growth industry and have high market share

A

stars; eventually become cash cows

44
Q

____ have low growth but high market share

A

cows; finance stars and question marks

45
Q

____ are new ventures with a high market growth but low market share

A

question marks; may grow into stars or diminish like dogs

46
Q

____ have a low growth and low market share

A

dogs; companies should divest from these markets

47
Q

refers to putting strategic plans into effect

A

strategy implementation

48
Q

consists of using questioning, analysis, and follow-through to mesh strategy with reality, align people with goals, and achieve promised results

A

execution

49
Q

tool effective leaders use to get their followers to adopt behaviors that lead to successful strategy execution; displayed through motivating people, modeling desired behaviors, and shaping culture and values

A

visible leadership

50
Q

tool used by managers to clearly define roles, delegate authority, and hold individuals accountable for strategy execution

A

clear roles and accountability

51
Q

tool used by managers to create a culture of honesty and openness, and they must listen to and encourage debate amongst subordinate

A

candid communication

52
Q

tool used by managers to ensure that the organization’s recruiting, selection, training, compensation, promotion, transfers, and layoffs fit well within the strategy

A

appropriate human responsibility practices

53
Q

three core processes of business

A
  1. people
  2. strategy
  3. operations
54
Q

consists of monitoring the execution of strategy and making adjustments if necessary

A

strategic control

MAN3025 (7 decks)

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