Management-Chapter 8 Flashcards
Strategic Management
Refers to the set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals.
Strategy
The plan of action that describes resource allocation and activities for dealing with the environment, achieving a competitive advantage and attaining goals.
Competitive Advantage
Refers to what sets the organiation apart from others and provides it with a distinctive edge in the marketplace.
Core Competence
Something that the organization does particularly well in comparison to others.
Synergy
When the organization’s parts interact to produce a joint effect that is greater than the sum of the parts acting alone.
Corporate-Level Strategy
Pertains to the organization as a whole and the combination of business units and products that make it up.
Business-Level Strategy
Pertains to each business unit or product line within the organization.
Functional-Level Strategy
Pertains to the major functional departments within each business unit, such as manufacturing, marketing and research and development.
Strategy Formation
The stage of strategic management that includes the planning and decision making that lead to the establishment of the organization’s goals and a specific strategic. plan
SWOT Analysis
Managers often start with an audit or careful examination of strengths, weaknesses, opportunities and threats that affect organizational performance.
Strategy Execution
The stage of strategic management that involves the use of managerial and organizational tools to direct resources toward achieving strategic outcomes.
Portfolio Strategy
Pertains to the mix of strategic business units and product lines that fit together in a logical way to provide synergy and competitive advantage.
Strategic Business Unit (SBU)
A division of the organization that has a unique business, mission, product or service line, competitors, and markets relative to other units of the same organizations.
BCG Matrix
A concept developed by the Boston Consulting Group that evaluates SBU’s with respect to two dimensions- business growth rate and market share- and classifies them as cash cows, stars, question marks, or dogs.
Diversification
The strategy of moving into new lines of business.
Related Diversification
Moving into a new business that is related to the corporation’s existing business activities.
Unrelated Diversification
Expanding into totally new lines of business.
Vertical Integration
Some managers pursue diversification through this strategy which means expanding into businesses that either provide the supplies needed to make products or distribute and sell the company’s products.
Differentiation Strategy
A strategy with which managers seek to distinguish the organization’s products and services from those of others in the industry.
Cost Leadership Strategy
A strategy with which managers aggressively seek efficient facilities, cut costs, and use tight costs controls to be more efficient than others in the industry.
Focus Strategy
Managers use either a differentiation or a cost leadership approach, but they concentrate on a specific regional market or buyer group.
Globalization Strategy
Product design and advertising are standardized throughout the world.
Multidomestic Strategy
Means that competition in each country is handled independently; product design and advertising are modified to suit the specific news of individual countries.
Transnational Strategy
A strategy that combines global coordination to attain efficiency with local flexibility to meet needs in different countries.
