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MGT 305 > EXAM 4 > Flashcards

EXAM 4 Flashcards

1
Q

Planning

A

Setting goals and deciding how to achieve them

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1
Q

Plan

A

A document that outlines how goals are going to be met

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2
Q

Business plan

A

A document that outlines a firm’s goals, the strategy for achieving them and the standards for measuring success

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3
Q

Business model

A

Outlines the need the firm will fill, the operations of the business, its component and functions, and expected revenues and expenses

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4
Q

Strategy

A

Sets the longterm goals and direction for an organization

Generally reconsidered every year because of changing conditions

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5
Q

Strategic management

A

A process that involves managers from all parts of the organization in the formulation and implementation of strategies

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6
Q

An organization should adopt planning and strategic management for 3 reasons

A
  1. Provide direction and momentum
  2. Encourage new ideas
  3. Develop a sustainable competitive advantage
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7
Q

Mission statement

A

“What is our reason for being?”

Responsibility of top management and board of directors

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8
Q

Vision statement

A

“What do we want to become?”

Guides decisions

Developed by top managers

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9
Q

Values statement

A

“What values do we want to emphasize?”

What a company stands for

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10
Q

Strategic planning

A

Done by top managers for the next 1-5 years

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11
Q

Tactical planning

A

Done by the middle managers for the next 6-24 months

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12
Q

Operational planning

A

Done by first-line managers for the next 1-52 weeks

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13
Q

Characteristics of effective vision statements

A

Clarity
Future focus
Abstractness & challenge
Idealism

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14
Q

Goal (objective)

A

A specific commitment to achieve a measurable result within a stated period of time

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15
Q

Long-term goals (strategic goals)

A

1-5 years

Focus on achieving the strategies in a company’s strategic plan

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16
Q

Short-term goals (tactical or operational goals)

A

12 months

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17
Q

Means-end chain

A

Shows how goals are connected or linked across an organization

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18
Q

Operating plan

A

A plan that breaks long-term output into short-term goals

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19
Q

Action plan

A

The course of action needed to achieve a stated goal

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20
Q

SMART goal

A

Specific
Measurable (or quantifiable)
Attainable (or realistic)
Results-oriented (support company’s vision)
Target dates (deadlines)

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21
Q

Management by objectives (MBO)

A
  1. Jointly set objectives
  2. Develop action plans
  3. Periodically review performance
  4. Give performance appraisal and rewards
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22
Q

Cascading goals

A

Process of ensuring that the strategic goals set at the top level align (or cascade) downward with more specific short terms goals

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23
Q

For goal setting to be successful…

A
  1. Top management and middle management must be committed
  2. It is best to cascade goals
  3. Goals must “cascade” (be linked consistently down through the organization)
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24
Q

Planning/control cycle

A
  1. Make the plan
  2. Carry out the plan
  3. Control the direction by comparing results with the plan
  4. Control the direction by taking corrective action in 2 ways (correcting deviations or improving future plans)
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25
Q

Main core skill

A

Critical thinking/problem thinking (consider alternative solutions to problems and remain open-minded)

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26
Q

Main soft skill

A

Networking

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27
Q

Main knowledge skills

A

Task-based/functional

Understanding the business

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28
Q

Proactive

A

Relying on your own choices instead of luck and circumstances. Controlling the situation

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29
Q

Strategic positioning

A

Attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company

(Performing different activities from rivals)

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30
Q

Key principles of strategic positioning

A
  1. Strategy is the creation of a unique and valuable position
  2. Strategy requires trade-offs in competing
  3. Strategy involves creating a “fit” among activities
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31
Q

Levels of strategy

A
  1. Corporate-level
  2. Business-level
  3. Functional-level
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32
Q

Corporate-level strategy

A

Focuses on the organization as a whole

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33
Q

Business-level strategy

A

Focuses on individual business units or product/service lines

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34
Q

Functional-level strategy

A

A plan of action by each functional area of the organization to support higher level strategies

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35
Q

5 steps of the strategic management process

A
  1. Establish the mission, visions, and values statements
  2. Assess the current reality
  3. Formulate corporate, business, & functional strategies
  4. Strategic implementation: Execute the strategies
  5. Maintain strategic control: The feedback loop
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36
Q

Strategy formulation

A

Process of choosing among different strategies and altering them to best fit the organization’s needs

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37
Q

Strategy implementation

A

Putting strategic plans into effect

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38
Q

Strategic control

A

Consists of monitoring the execution of strategy and making adjustments

39
Q

Sustainable competitive advantage

A

Exists when other companies cannot duplicate the value delivered to customers

40
Q

SWOT analysis

A

A company assesses its strengths, weaknesses, opportunities, and threats

41
Q

SWOT analysis divided into 2 parts

A
  1. Internal strengths and weaknesses
  2. External opportunities and threats
42
Q

Organizational strengths

A

The skills and capabilities that give the organization special competencies and competitive advantages

43
Q

Organizational weaknesses

A

The drawbacks that hinder an organization

44
Q

Organizational opportunities

A

Environmental factors that the organization may exploit for competitive advantage

45
Q

Organizational threats

A

Environmental factors that hinder an organization’s achieving a competitive advantage

46
Q

VRIO

A

A framework for analyzing a resource or capability to determine its competitive strategic potential

47
Q

VRIO questions

A

Valuable?
Rare?
Costly to imitate?
Organized to exploit value, rarity, Imitability? (capable or worthy of being imitated)

48
Q

Forecast

A

A vision or projection of the future

49
Q

Trend analysis

A

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

50
Q

Contingency planning (scenario analysis)

A

Creation of alternative hypothetical but equally likely future conditions

51
Q

Benchmarking

A

A process where a company compares its performance with that of high-performing organizations

52
Q

3 types of corporate strategies

A
  1. Growth strategy
  2. Stability strategy
  3. Defensive strategy
53
Q

A growth strategy

A

Involves expansions as in sales revenues, market share, number of employees, or # of customers

54
Q

Innovation strategy

A

Part of growth strategy

Grows market share or profits by innovating improvement in products or services

55
Q

Stability strategy

A

Involves little or no significant change

56
Q

Defensive strategy

A

Involves reduction in the organization’s efforts

57
Q

BCG matrix

A

Used by companies to evaluate their strategic business units on the basis of (1) their business growth rates and (2) their share of the market

58
Q

Stars

A

High growth, high market share (definite keepers)

59
Q

Question marks

A

Risky new ventures (some will become stars, some dogs)

60
Q

Cash cows

A

Have slow growth but high market share

61
Q

Dogs

A

Have low growth, low market share (should be gotten rid of)

62
Q

Diversification

A

Company operates several businesses in order to spread the risk

63
Q

Related diversification

A

When a company purchases a new business that is related to the company’s existing business portfolio

Ex. Disney purchase of 21st century fox

64
Q

Unrelated diversification

A

Company acquires another company in a completely unrelated business

Ex. Amazon’s purchase of Whole Foods

65
Q

Vertical integration

A

A firm expands into businesses that provide the supplies it needs to make its products

Ex. Starbucks buys and roasts their own coffee

66
Q

Porter’s Model for industry analysis

A
  1. Threats of new entrants
  2. Bargaining power of suppliers
  3. Bargaining power of buyers
  4. Threats of substitute products or services
  5. Rivalry among competitors
67
Q

Porter’s 4 competitive strategies

A
  1. Cost-leadership (keep costs and prices low or a wide market)
  2. Differentiation (offering unique and superior value for a wide market)
  3. Cost-focus (keeping costs and prices low for a narrow market)
  4. Focused differentiation (offering unique and superior value for a narrow market)
68
Q

3 core processes of business

A
  1. People (consider who will benefit you in the future)
  2. Process (consider how success will be accomplished)
  3. Operations (consider what path will be followed)
69
Q

Controllings

A

Monitoring performance, comparing it with goals, taking corrective actions

70
Q

Control process steps

A
  1. Establish standards
  2. Measure performance
  3. Compare performance to standards
  4. Take corrective action
71
Q

Control standard

A

The desired performance level for a given goal

72
Q

Feedforward control

A

Focuses on preventing future problems

73
Q

Control charts

A

A visual statical tool used for quality control purposes

74
Q

Concurrent control

A

Entails collecting performance information in real time

75
Q

Feedback control

A

Amounts to collecting performance information after a task or project is done

76
Q

Balanced scorecard

A

Gives top managers a fast but comprehensive view of the organization via 4 indicators

  1. Customer satisfaction
  2. Internal processes
  3. Organization’s innovation & improvement activities
  4. Financial measures
77
Q

Budget

A

A formal financial projection

78
Q

Incrementing budgeting

A

Allocating increased or decreased funds to a department by using the last budget period as a reference point

79
Q

Fixed budget

A

Allocates resources on the basis of a single estimate of costs

80
Q

Variable budget

A

Allows the allocation of resources to vary in proportion with various levels of activity

81
Q

Customer retention

A

Refers to the actions companies take to reduce customer defections

82
Q

Productivity

A

Outputs / inputs

83
Q

Quality assurance

A

Focuses on the performance of workers, urging employees to strive for 0 defects

84
Q

Deming management

A
  1. Quality should be aimed at the needs of the consumer
  2. Companies should aim at at improving the system, not blaming workers
  3. Improved quality leads to increased market share, company prospects, and employment

4.Quality can be improved on the basis of hard data

85
Q

PDCA cycle

A

A Plan-Do-Check-Act cycle used to observe data for continuous improvement of operations

86
Q

Total quality management (TQM)

A
  1. Make continuous improvement a priority
  2. Get every employee involved
  3. Listen to and learn from customers and employees
  4. Use accurate standards to identify and eliminate problems
87
Q

Two core principles of TQM

A
  1. People orientation
  2. Improvement orientation
88
Q

Kaizen

A

Japanese philosophy of small continuous improvements

89
Q

Reduced cycle time

A

The reduction of steps in the work process

90
Q

Statistical process control

A

Uses periodic random samples from production runs to see if quality is being maintained

91
Q

Six sigma

A

A process that reduces defects in manufacturing and service-related industries

92
Q

Lean six sigma

A

Focuses on problem solving and performance improvement

93
Q

ISO 9000 Series

A

Quality control procedures companies must install

94
Q

Main attitude

A

Career management

95
Q

6 areas of control

A

Structural
Cultural
Physical
Human Resources
Informational
Financial

96
Q

Barries to control success

A

Too much control

Overemphasis on means instead of ends

Overemphasis on one instead of multiple approaches

MGT 305 (3 decks)

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