Lecture 4 Flashcards
strategy
The overall plan for future direction and actions of a company. It applies to the company as a whole.
The plan for the future of the company and how it will achieve its goals.
What it wants to achieve and how it is going to do that/
business model
How the company will create and capture value. Can vary per product or service.
mission
a statement of what a business wants to achieve and what business it is in
reasons for being, what the company stands for.
The company’s identity and what it wants to achieve.
vision
Image of future direction. Build on the mission; it discribes how the future would look like if the mission is achieved.
mission, vision, strategy and goals/objectives
- Mission provides the core purpose, answering “why” the company exists.
- Vision describes the desired future state, answering “what” the company wants to become.
- Strategy lays out “how” the company will move toward the vision and fulfill the mission.
- Goals & Objectives are measurable steps within the strategy that track progress toward achieving the mission and vision.
emergent strategy
The unexpected strategies that arise from changes in the company’s environment. Adjusting the strategy in response to the real world.
IS/IT strategy
How information systems (IS) are used in an organization to support the business strategy and possibly create an advantage over competitors.
This has to be aligned with the business strategy:
- business aligning
- business impact
- interaction model
3 ways of aligning or formulating IS strategy
- Business Aligning: aligning IS with the business strategy (technology should help to achieve business goals)
- Business Impact: changes in technology can force you to redefine the strategy (technology can change business strategy)
- Interaction Model: Business strategy and IS strategy influence and adapt to each other.
PESTEL analysis
Analysing the external macro-environment of the organisation
P: Political
E: Economic
S: Social
T: Technological
E: Environmental (e.g., weather, climate)
L: Legal
Porter’s five forces model
Helps organization analyse the competitive forces in an industry.
- Threat of New Entrants – the likelihood that new competitors will enter the market and challenge existing players.
- Bargaining Power of Suppliers – the influence suppliers have on prices and terms.
- Bargaining Power of Buyers – the ability of customers to demand lower prices or higher quality.
- Threat of Substitutes – the impact of alternative products or services on demand.
- Rivalry Among Existing Competitors (competitive rivalry) – the level of competition among companies in the market.
Porter’s competitive strategies
- Cost Leadership: Strive to be the lowest-cost provider in the industry, offering the cheapest prices.
- Differentiation: Focus on being better than competitors by offering unique or superior products and services.
- Focus: Concentrate on a specific market segment or customer group, tailoring products or services to their needs.
Tracy & Wiersema’s value disciplines
- Operational Excellence: Focus on efficiency and reliability, delivering products or services at the lowest cost
- Product Leadership: Focus on innovation, offering the best and most unique products
- Customer Intimacy: Focus on personalized customer relationships and tailored solutions
threshold value
You must achieve a basic level of acceptance in all three value disciplines in order to compete in the market.
leadership value
that you excel in one of the three value disciplines (operational excellence, product leadership or customer intimacy) and thereby gain a competitive advantage over your competitors
SWOT
Used to analyze the internal and external factors that affect an organization.
- S – Strengths: Internal factors that give the organization an advantage over others.
- W – Weaknesses: Internal factors that put the organization at a disadvantage.
- O – Opportunities: External factors or trends that the organization can use to its advantage..
- T – Threats: External factors that could harm the organization.
balanced scorecard
Helps to translate strategy into clear and measurable objectives.
> Set clear objectives, measures, targets and initiatives
Four key perspectives it measures:
- Financial: Focus on financial goals (e.g., revenue, profit).
- Customer: Measure customer satisfaction and loyalty.
- Internal Processes: Improve operational efficiency and quality.
- Learning & Growth: Focus on employee satisfaction and development (and innovation).
