MODULE 1-3 Flashcards
the directing of activities toward the
accomplishment of corporate
objectives.
EXECUTIVE
LEADERSHIP
occurs when two firms share a director or when an executive of one firm sits on the board of a second firm.
direct interlocking directorate
Lower-priority
groups that affect or are affected by the
achievement of a firm’s objectives
Secondary stakeholders
BENEFITS OF STRATEGIC
MANAGEMENT
CREATING, ACQUIRING, AND TRANSFERRING
KNOWLEDGE
ITS BEHAVIOR
MODIFYING
ITS BEHAVIOR
REFLECT NEW
KNOWLEDGE
AND INSIGHTS.
a process of understanding the interaction of decisions and their impact upon the organization to gain an advantage
STRATEGIC DECISION MAKING
A decision-making mode that involves the systematic gathering of appropriate information for situation analysis,
the generation of feasible alternative strategies, and the rational selection of the most appropriate strategy.
Planning mode
a description of what the company is
capable of becoming. It is often communicated in the company’s mission and vision
statement
STRATEGIC
VISION
CARROLL’S FOUR
RESPONSIBILITIES
OF BUSINESS
Economic, Legal, Ethical, Philantropic
A decision-making mode characterized by reactive solutions to existing problems, rather than a proactive search for new opportunities.
Adaptive mode
INTERLOCKING DIRECTORATES
Direct and indirect interlocking directorates
STRATEGIC DECISION MAKING PROCESS
Evaluate current performance results
Review corporate governance
Scan and assess the external environment
Scan and assess the internal corporate environment
Analyze strategic SWOT factor
Generate, evaluate, and select the best alternative strategy
Implement the selected strategy
Evaluate implemented strategy
ROLE OF THE BOARD IN
STRATEGIC MANAGEMENT
Monitor, Evaluate and influence, Initiate and determine
Involved to a limited degree in the performance or review of selected key decisions, limited engagement in discussion and decision making
nominal participation
is the identification and evaluation of corporate stakeholders
STAKEHOLDER ANALYSIS
Degree of Involvement
Phantom, rubber stamp, minimal review, nominal participation, active participation and catalysts
A leader who
causes change and movement in an organizaztion by providing a strategic vision.
Transformational leader
refers to the relationship of BOD, Top
management and Shareholders in
determining the direction and performance of the corporation
CORPORATE GOVERNANCE
High level of engagement, approves, questions and makes decision
active participation
THEORIES ABOUT INTERNAL & OUTSIDE BOD
Agency Theory
Stewardship Theory
A high priority
group that affects or is affected by the
achievement of a firm’s objectives
Primary stakeholders
The internationalization of markets and corporations
Globalization
Formally reviews selected issues that officers bring to its attention, limited assessments on operation
minimal review
BASIC MODEL OF STRATEGIC MANAGEMENT
ENVIRONMENTAL SCANNING
STRATEGY FORMULATION
STRATEGY IMPLEMENTATION
EVALUATION AND CONTROL
takes the leading role
catalyst
no active involvement, never knows what to do
Phantom
CHALLENGES TO STRATEGIC MANAGEMENT
ENVIRONMENTAL SUSTAINABILITY AND GLOBALIZATION
MINTZBERG MODES OF SDM
ENTREPRENEURIAL MODE
ADAPTIVE MODE
PLANNING MODE
LOGICAL INCREMENTALISM
who said that “there is one and only social responsibility of business-to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game”
Milton Friendman
a set of managerial decisions and
actions that determines the long run
performance of a corporation
STRATEGIC
MANAGEMENT
RESPONSIBILITIES OF BOARD OF DIRECTORS
- Setting corporate strategy, overall direction, mission, or vision
- Hiring and firing the CEO and top management
3.Controlling, monitoring, or supervising top management
- Reviewing and approving the use of resources
- Caring for shareholder interests
permits officers to make all decisions, lacks independence and critical thinking
Rubber stamp
occurs when two corporations have
directors who also serve on the board of a third firm
indirect interlock
A strategy made by
one powerful individual in which the focus is on opportunities, and problems are
secondary
Entrepreneurial mode
A decision-making
mode that is a synthesis of the planning, adaptive, and entrepreneurial modes.
Logical incrementalism
