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Management > Chapter 6 Organizational Strategy > Flashcards

Chapter 6 Organizational Strategy Flashcards

1
Q

what are the four components of a sustainable competitive advantage?

A

valuable, rare, imperfectly imitable, and non-substitutable (VRIN)

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2
Q

resources

A

the assets, capabilities, processes, employee time, information, and knowledge that an organization uses to improve its effectiveness and efficiency and create and sustain competitive advantage

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3
Q

competitive advantage

A

providing greater value for customers than competitors can

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4
Q

sustainable competitive advantage

A

competitive advantage that other companies have tried unsuccessfully to duplicate and have, for the moment, stopped trying to duplicate

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5
Q

valuable resource

A

a resource that allows companies to improve efficiency and effectiveness

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6
Q

rare resource

A

a resource that is not controlled or possessed by many competing firms

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7
Q

imperfectly imitable resource

A

a resource that is impossible or extremely costly or difficult for other firms to duplicate

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8
Q

nonsubstitutable resource

A

a resource that produces value or competitive advantage and has no equivalent substitutes or replacements

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9
Q

what are the steps in a strategy-making process?

A

assess the need for strategic change, conduct a situational analysis, and choose strategic alternatives

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10
Q

competitive inertia

A

a reluctance to change strategies or competitive practices that have been successful in the past

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11
Q

strategic dissonance

A

a discrepancy between a company’s intended strategy and the strategic actions managers take when implementing that strategy

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12
Q

situational analysis (SWOT)

A

an assessment of the strengths and weaknesses in an organization’s internal environment and the opportunities and threats in its external environment

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13
Q

shadow-strategy task force

A

a committee within a company that analyzes the company’s own weaknesses to determine how competitors could exploit them for competitive advantage

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14
Q

distinctive competence

A

what a company can make, do, or perform better than its competitors

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15
Q

core capabilities

A

the internal decision-making routines, problem-solving processes, and organizational cultures that determine how efficiently inputs can be turned into outputs

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16
Q

strategic group

A

a group of companies within an industry against which top managers compare, evaluate, and benchmark strategic threats and opportunities

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17
Q

core firms

A

the central companies in a strategic group

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18
Q

secondary firms

A

the firms in a strategic group that follow strategies related to but somewhat different from those of core firms

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19
Q

strategic reference points

A

the strategic targets managers use to measure whether a firm has developed the core competencies it needs to achieve a sustainable competitive advantage

20
Q

what are the two types of corporate-level strategies?

A

portfolio strategy and grand strategy

21
Q

corporate-level strategy

A

the overall organizational strategy that addresses the questions: “what business or businesses are we in or should we be in it?”

22
Q

diversification

A

a strategy for reducing risk by buying a variety of items (stocks or businesses) so that failure of one stock or business does not doom the entire portfolio

23
Q

portfolio strategy

A

a corporate-level strategy that minimizes risk by diversifying investment among various businesses or product lines

24
Q

acquisition

A

the purchase of a company by another company

25
Q

unrelated diversification

A

creating or acquiring companies in completely unrelated businesses

26
Q

BCG (Boston Consulting Group) matrix

A

a portfolio strategy that categorizes a corporation’s businesses by growth rate and relative market share and helps managers decide how to invest corporate funds

27
Q

star

A

a company with a large share of a fast-growing market

28
Q

question mark

A

a company with a small share of a fast-growing market

29
Q

cash cow

A

a company with a large share of a slow-growing market

30
Q

dog

A

a company with a small share of a slow-growing market

31
Q

related diversification

A

creating or acquiring companies that share similar products, manufacturing, marketing, technology, or cultures

32
Q

grand strategy

A

a broad corporate-level strategic plan used to achieve strategic goals and guide strategic alternatives that managers of individual businesses or subunits may use

33
Q

growth strategy

A

a strategy that focuses on increasing profits, revenues, market share, or the number of places in which the company does business

34
Q

stability strategy

A

a strategy that focuses on improving the way in which the company sells the same products or services to the same customers

35
Q

retrenchment strategy

A

a strategy that focuses on turning around very poor company performance by shrinking the size or scope of the business

36
Q

recovery

A

the strategic actions taken after retrenchment to return to a growth strategy

37
Q

industry-level strategy

A

a corporate strategy that addresses the question, “how should we compete in this industry?”

38
Q

character of the rivalry

A

a measure of the intensity of competitive behavior between companies in an industry

39
Q

threat of new entrants

A

a measure of the degree to which barriers to entry make it easy or difficult for new companies to get started in an industry

40
Q

threat of substitute products or services

A

a measure of ease with which customers can find substitutes for an industry’s products or services

41
Q

bargaining power of suppliers

A

a measure of the influence that suppliers of parts, materials, and services to firms in an industry have on the prices of these inputs

42
Q

bargaining power of buyers

A

a measure of the influence that customers have on a firm’s prices

43
Q

cost leadership

A

the positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors can, so that the firm can offer the product at the lowest price in the industry

44
Q

differentiation

A

the positioning strategy of providing a product or service that is sufficiently different from competitors’ offerings that customers are willing to pay a premium price for it

45
Q

focus strategy

A

the positioning strategy of using cost leadership or differentiation to produce a specialized product or service for a limited, specially targeted group of customers in a particular geographic region or market segment

46
Q

attack

A

a competitive move designed to reduce a rival’s market share or profits

47
Q

response

A

a competitive countermove, prompted by a rival’s attack, to defend or improve a company’s market share or profit

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