Models Flashcards
WHAT IS THE SMART MODEL?
It is used to analyse objectives of an organisation:
Specific - clear statement, easy to understand
Measurable - enable communication down the organisation
Attainable - pointless setting them otherwise
Relevant - appropriate to mission/ stakeholders
Timed - time period to achieve it
WHAT IS THE ASHRIDGE MODEL?
Looks at what a mission statement should include:
PURPOSE: why does the organisation exist?
STRATEGY: what resources, competencies or generic strategy give the company a competitive advantage?
POLICIES & VALUES: the company’s values/ ethical approach.
WHAT IS MENDELOW’S POWER- INTEREST STAKEHOLDER MATRIX?
It involves prioritising interest and power of stakeholders and shaping an appropriate response.
LEVEL OF INTEREST
Low High
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
Low Minimal effort Keep informed
Can be directed POWER
High Keep satisfied Key players
Intervention req Need participation
WHAT IS THE PESTEL ANALYSIS?
Political Economic Social/ demographic Technological Ecological/ environmental Legal
The is a form of external analysis to identify threats and opportunities.
These factors are outside the control of the business but may indicate if the market is likely to grow and in what direction.
WHAT IS PORTERS DIAMOND MODEL?
Model for external analysis. Used for international growth.
Demand Conditions
| Strategy, THE Related & Structure \_\_\_ COMPETITIVE \_\_ Supporting & Rivalry ADVANTAGE Industry
|
Factor Conditions
FACTOR CONDITIONS (supply side) The availability of factors or production. Basic factors are widely available so do not provide sustainable competitive advantage. Advanced factors are less available so do provide sustainable competitive advantage.
DEMAND CONDITIONS
More demanding local consumers force firms to be more innovative. Trend setting local consumers help local producers to anticipate future global trends.
RELATED AND SUPPORTING INDUSTRIES
Proximity of supply leads to reduced lead times and carriage costs. It also encourages knowledge sharing which increases innovation.
STRATEGY, STRUCTURE AND RIVALRY
Strong rivalry forces firms to be more efficient and therefore able to compete internationally.
WHAT ARE PORTERS 5 FORCES?
1) Threat of new entrants
- barriers of entry
2) Threat of substitute product
- substitute industries available?
3) Bargaining power of buyers
- strong buyer power = lower prices
4) Bargaining power of suppliers
- strong supplier power = higher input prices
5) Competition amongst existing players
- how strong is competition?
It measures the attractiveness of an industry.
DESIRABLE:
- weak suppliers/ buyers
- few substitutes
- significant entry barriers
- little existing competitive rivalry
SUBSTANTIAL COMPETITIVE ADVANTAGE
Resources Competences
________________________________
No SCA Threshold Threshold
resource competence
SCA Unique Core
resource competence
THRESHOLD RESOURCE
Basic resources, needed by all firms in the market (retail premises for M&S)
UNIQUE RESOURCE
These are better than competition and are hard to copy (brand)
THRESHOLD COMPETENCE
Activities and processes necessary to stay in business (automated till and re-ordering systems)
CORE COMPETENCE
Critical activities and processes, better than competition and are hard to copy (reputation for
customer service)
WHAT IS KAYS MODEL - CORE COMPETENCES?
(1) COMPETITIVE ARCHITECTURE
Unique organisational knowledge, co-operative and
organisational routines arising from:
- internal architecture, relations with employees
- external architecture, relations with suppliers/ customers
- network architecture, relations between group of firms
(2) REPUTATION
Helps promote a strong brand and thus sales.
(3) INNOVATIVE ABILITY
Ability to create and develop new products.
WHAT IS THE RESOURCE AUDIT?
(9M’s)
The MAN went to the MARKET with his MONEY to buy MATERIALS as MANAGEMENT told him he had to MAKE-UP MACHINES per the METHODS of the MANAGEMENT INFORMATION SYSTEMS.
Helps to identify CSF of a company and can be used in assessing strategic potential of a business.
WHAT IS THE MARKETING MIX?
PRODUCT INDUSTRY Product Price Place Promotion
SERVICE INDUSTRY
People
Processes
Physical evidence
BRAND POSITIONING - PRICE ANALYSIS
QUALITY
Low High
________________________________
High Cowboy Premium
brand brand
PRICE
Low Economy Bargain
brand brand
COWBOY BRAND - overpriced for quality of product
ECONOMY BRAND - low price and acceptable quality
PREMIUM BRAND - high price for high quality
BARGAIN BRAND - low price yet a good quality
WHAT IS THE 4C’S PRINCIPLES OF PRICING?
COSTS - must be covered by pricing structure in the long term
CUSTOMER - how and how much are customers willing to pay?
COMPETITION - what the opposition is charging
CORPORATE OBJECTIVES - how does the business price their goods to achieve their aims/ strategies?
MINTZBERG’S STRUCTURAL CONFIGURATIONS
6 component parts of an organisation explains the formal and informal structural relationships within the entity.
1) OPERATING CORE - basic work of an organisation
2) STRATEGIC APEX - higher management
3) MIDDLE LINE - managers linking between the strategic
apex and operating core
4) TECHNOSTRUCTURE - expert coordination of processes
5) SUPPORT STRUCTURE - provision of services to
organisations with supports it (e.g catering)
6) IDEOLOGY - organisations values and beliefs
HANDYS SHAMROCK ORGANISATION
Analyses how firms can improve efficiency and cut costs by considering staffing issues more flexibly. Businesses should focus on vital ‘permanent’ staff with support from part-time staff.
PROFESSIONAL CONTRACTUAL
CORE FRINGE
|______________________|
| |
FLEXIBLE LABOUR CUSTOMERS
FORCE
Professional core - permanently employed staff
Contractual fringe - outsourced staff, non core services
Flexible labour force - temporary/ part time staff
Customers - may perform some tasks themselves (e.g online booking)
BCG MATRIX
MARKET SHARE
High Low
________________________________
High Star Problem child
MARKET
GROWTH
Low Cash cow Dog
STAR - dominating position, high market growth, large cash flows to be reinvested to defend market share. Cash neutral = reinvest heavily
PROBLEM CHILD - attractive market but firm does not have the market share to be competitive. Lacking economies of scale. Investment will result in large negative cash flow.
CASH COW - dominating position in low growth market. Competitors will attack the market share. Large positive cash flow with minimal investment = minimal investment
DOG - low share of unattractive market, product isn’t competitive. Should kill the dog in the long run.
PORTERS GENERIC STRATEGIES
BASIS OF COMPETITION
Lower cost Differentiation
________________________________
Broad Cost Differentiator
leadership
COMPETITIVE
SCOPE
Narrow Cost Differentiation
focus focus
ANSOFF’S MATRIX
PRODUCTS
Existing New
________________________________
Existing Market Product
penetration development
MARKETS
New Market Diversification
development
MARKET PENETRATION - selling more existing products to existing markets (competitive pricing, advertising, sales promotion)
PRODUCT DEVELOPMENT - developing new products for existing markets (generate product ideas, use existing distribution channels and knowledge of the market)
MARKET DEVELOPMENT - new markets for existing products (new geographical markets, distribution channels, differential pricing, new segments)
DIVERSIFICATION - new products in new markets (vertical integration or conglomerate diversification)
RISK TREATMENT - TARA MODEL
AVOIDENACE
- avoid downside by not undertaking/ terminating risky activities
- usually loose upside potential as we’ll
TRANSFER
- transfer risk to a third party (insurance)
REDUCTION
- retain activity but take action to limit risk to acceptable levels
- e.g mitigation controls: preventive, corrective, directive, detective
RETENTION/ ACCEPTANCE
- tolerating losses when they arise
- for smaller risks may be cheaper than insurance
LYNCH EXPANSION MODEL
COMPANY
Internal External
Development Development
________________________________
Home (a) (b)
Country
NEW LOCATION
Abroad (c) (d)
(a) internal domestic development
(b) joint ventures, merger/ acquisition, alliance, franchise
(c) exporting, overseas office/ manufacture, global operation
(d) joint ventures, merger/ acquisition, alliance, franchise
BALANCED SCORECARD
Assumes that the overall goal of the organisation is to generate long term economic value. Aims to provide a broad range of both financial and non financial measures designed to reflect the complexity of the businesses circumstances.
THE FOUR PERSPECTIVES
- Customers, what do they value?
- Internal, what are our internal CSF?
- Innovation and learning, what new products to people need?
- Financial, how do we create value for shareholder?
DISADVANTAGES
- can encourage short termist behaviour
- ignore strategic goals
- historic measures are not predictive
- can be easily manipulated
WHAT ARE THE 4 V’S OF OPERATIONS?
VOLUME - high volume operations tends to be more capital intensive, likely to be greater specialisation in skills
VARIETY - some operations handle a wide variety of inputs/ outputs
VARIATION IN DEMAND - demand may vary significantly over periods (e.g seasonal trends)
VISIBILITY - when operation is highly viable, employees will have to show good communication skills and interpersonal skills when dealing with customers
LEWINS FORCE FIELD ANALYSIS
E.g. A very big change in management
Forces for | Resistance |
change => | <= to change |
| |
Current Desired
position position
LEWIN AND SCHEIN’S ICEBERG MODEL
Concerned with managing change. Three headings:
1) Unfreezing - invoices a trigger, challenge of existing behaviour, involvement of
outsiders or alteration to power structure
2) Moving - means making the changes, communicating and encouraging
adoption of new situation
3) Refreezing - means consolidation and reinforcement of new situation
Should discuss these three points as sub headings under the following three headings:
- communication
- education
- participation
