Exam 1

Question 1

Managers

Answer 1

Individuals in organizations who make decisions about the use of resources and who are concerned with planning, staffing, organizing, leading, and controlling the organization’s activities to reach its objectives.

Question 2

Strategy (According to Porter)

Answer 2

the creation of a unique and valuable position involving a different set of activities…or performing similar activities differently

Question 3

Operational Effectiveness

Answer 3

Performing similar activities better than rivals perform them or performing different activities than competitors.

Question 4

Strategic Positioning

Answer 4

Sustainable competitive advantage by preserving what is unique about a company through performing different activities from rivals, or performing similar activities in different ways

Question 5

Variety Based Positioning

Answer 5

can be based on producing a subset of an industries products or services (ex. Jiffy Lube)

Question 6

Needs Based Positioning

Answer 6

Serving most or all the needs of a particular group of customers (ex. IKEA)

Question 7

Access Based Positioning

Answer 7

segmenting customers who are accessible in different ways

Question 8

3 Activity Types (According to Porter)

Answer 8

Direct - involved in creating value for the buyer such as assembly, parts machining, sales force operation, advertising, product design

Indirect - make it possible to perform direct activities on a continuing basis such as maintenance, scheduling, sales force administration

Quality Assurance - ensure other activities such as monitoring, inspecting, testing, reviewing

Question 9

Types of Fit (According to Porter)

Answer 9

First order of Fit - Simple Consistency - There is simple consistency between each activity and the overall strategy. Ex. Southwest Airlines

Second order fit - Reinforcing consistency - When activities are reinforcing.

Third order fit - Optimization - Goes beyond activity reinforcement to what porter calls Optimization of effort

Stars Rape Ogers

Question 10

Margin (According to Porter)

Answer 10

the difference between total value and the collective cost of performing the value activities

Question 11

Primary Activities

Answer 11

Inbound logistics – activities associated with receiving, storing a disseminating inputs to the product such as warehousing, inventory control etc.

Operations – activities associated with transforming inputs into the final product

Outbound logistics – activities associated with collecting storing and distributing to buyers.

Marketing and sales – associated with providing a means to by which buyers can purchase the product and inducing them to do so.

Service – associated with providing service to enhance or maintain the value of the product.

Question 12

Support Activities

Answer 12

Procurement – the function of purchasing inputs used in the firm’s value chain. Ex raw materials

Technology development – know how, procedures, or technology embodied in process.

Human Resource Management – recruiting, hiring, training, development, and compensation.

Firm Infrastructure – general management, planning, finance, accounting, legal, govt affairs, and quality management.

Question 13

Soldiering (According to Taylor)

Answer 13

Working in the steel industry, Taylor had observed the phenomenon of workers’ purposely operating well below their capacity, that is, soldiering. He attributed soldiering to three causes:

1. The almost universally held belief among workers that if they became more productive, fewer of them would be needed and jobs would be eliminated.
2. Non-incentive wage systems encourage low productivity if the employee will receive the same pay regardless of how much is produced, assuming the employee can convince the employer that the slow pace really is a good pace for the job. Employees take great care never to work at a good pace for fear that this faster pace would become the new standard. If employees are paid by the quantity they produce, they fear that management will decrease their per-unit pay if the quantity increases.
3. Workers waste much of their effort by relying on rule-of-thumb methods rather than on optimal work methods that can be determined by scientific study of the task.

Question 14

4 new duties to combat soildering

Answer 14

1. Replace rule-of-thumb work methods with methods based on a scientific study of the tasks.
2. Scientifically select, train, and develop each worker rather than passively leaving them to train themselves.
3. Cooperate with the workers to ensure that the scientifically developed methods are being followed.
4. Divide work nearly equally between managers and workers, so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks.

Question 15

Taylor Organizational theory

Answer 15

• responsibility
• separation of planning from operations
• incentive schemes for workers
• management by exception
• task specialization

Question 16

Drukers Assumptions about Management

Answer 16

• No new tools needed
• Study Manager’s Job over Workers
• Opportunities over problems
• Effectiveness over efficiency
• Guided by 90/10 social principle (cost)
— We migrate to the 90%; why?
• Focus more deeply on less

Question 17

Effectiveness (Acc. to Drucker)

Answer 17

Degree to which goals are achieved

Question 18

Efficiency (Acc. to Drucker)

Answer 18

use of minimal resources to produce the desired amount of output

Question 19

3 Steps towards Effectiveness According to Drucker

Answer 19

Analysis – The manager has to know 3 main facts
• The opportunities and true costs of products
• The potential contributions of different staff activities
• The economically significant cost centers

Allocation – Manager has to allocate resources according to results anticipated
• How resources are allocated now
• How resources should be allocated in the future for greatest opportunity
• What steps are necessary to get from what is to what ought to be

Resource Decision Making – The manager must be prepared to take the most painful step of all – that of deciding on those products, staff activities or cost areas that breed clutter than bring opportunity and results.

Question 20

Folklore: The effective manager has no regular duties to perform
Fact:

Answer 20

Managerial work involves performing a number of regulare duties, including ritual and ceremony, negotiations, and processing of soft information that links the organization with its environment.

Question 21

Folklore: The senior manager needs aggregated information, which a formal management information system best provides.
Fact:

Answer 21

Managers strongly favor verbal media, telephone calls and meetings, over documents

Question 22

Folklore: Management is, or at least is quickly becoming, a science and a profession.
Fact:

Answer 22

The managers programs – to schedule time, process information, make decisions, and so on – remain locked deep inside their brains.

Question 23

Roles of Management (Acc. to Mintzberg)

Answer 23

Informational roles – A monitor, a disseminator, and a spokesperson.
Decisional Roles – An entrepreneur, a disturbance handler, a resource allocator, and a negotiator.

Question 24

4 Duties of Management (Taylor)

Answer 24

1. Science over rule of thumb
2. Select/train and develop employees
3. Work with employees including pay and compensation
4. Equal division of labor between managers and employees

Question 25

STARS

Answer 25

S – Situation Analysis – Ext/Int, Pestle, SWOP
T – Task
A – Alternatives
R – Recommendation
S – Story – Tying things together

Question 26

3 Reasons why Trade-Offs Arise

Answer 26

1. Company may lack Credibility
2. Limitations on internal control
3. Arise from activities themselves

Question 27

Situation (external) = PESTLE

Answer 27

Political
Economic
Social
Technological
Legal
Enviornmental

Question 28

Situation (Internal) 7s of McKinsey

Answer 28

Structure
Systems
Style
Strategy
Skills
Staff
Shared Values

Question 29

Friedman

Answer 29

Econominst; Social responsibility to maximize SHAREHOLDER value

Question 30

Mackey

Answer 30

responsibility to drive value for multiple STAKEHOLDERS

Question 31

Rogers

Answer 31

More Friedman than Mackey

Question 32

Machiavelli

Answer 32

• Ends Justify Means

- Not thought of as Cruel and corrupt

Question 33

Fayol

Answer 33

Classical School of management; Taught that five functions of management are five fold: Planning, Organizing, Commanding, Coordinating, Controlling

Question 34

Weber

Answer 34

Bureaucratic Organization; Advocated leveling of social classes

Question 35

Follett

Answer 35

Buisness = Microcosim of human society; Advocated “Power with” rather than “Power Over”

Question 36

Maslow

Answer 36

Developed the “Hierarchy of Needs”

Question 37

Drucker

Answer 37

Management as a discipline; Managment can be taught and studied;

Question 38

Hofstede

Answer 38

Cross Cultural Managment

Question 39

Senge

Answer 39

Developed 5 disciplines of a learning organization; Only organizations that have the flexibility and skills to adapt will survive