SESSION 4-5

Question 1

What are the MUSTS for a Vision Statement?

Answer 1

• Should be developed first. It is the
  foundation for developing a mission statement
• A vision statement is a declaration
  of an organization’s overarching objective or goal.
• Your vision should be big, exciting
  and compelling.
• The vision statement should be
  short, preferably one sentence, and
  as many managers as possible
  should have input into developing
  the statement –SHARED VISION

Question 2

Which perspective should the Vision Statement be written in?

Answer 2

Customer’s

Question 3

Which should the Vision Statement do more and talk about?

Answer 3

Must do more than identify the
product/service a firm offers:

Should talk about the type of
business the company is engaged in.

Question 4

What are the MUSTS for a Mission Statement?

Answer 4

• A declaration of an
  organization’s “reason for being.”
• Your mission covers the who, what
  and how
• Also known as a Creed statement, a
  statement of purpose, philosophy,
  beliefs, business principles, or a definition of the business
• It is essential for effectively
  establishing objectives and formulating strategies.

Question 5

What are the characteristics for a Mission Statement?

Answer 5

1. Broad in scope; does not include monetary amounts, numbers, percentages,
   ratios, or objectives
2. Fewer than 150 words in length
3. Inspiring
4. Identifies the utility of a firm’s products
5. Reveals that the firm is socially responsible
6. Reveals that the firm is environmentally responsible
7. Includes nine components: customers, products or services, markets, technology,
   concern for survival/growth/profits, philosophy, self-concept, concern for public
   image, concern for employees
8. Reconciliatory
9. Enduring

Question 6

What are the 9 components for a Mission Statement?

Answer 6

1. Customers—Who are the firm’s customers?
2. Products or services—What are the firm’s major products or services?
3. Markets—Geographically, where does the firm compete?
4. Technology—Is the firm technologically current?
5. Survival, growth, and profitability—Is the firm committed to growth and financial soundness?
6. Philosophy—What are the basic beliefs, values, aspirations, and ethical priorities of the firm?
7. Self-concept (distinctive competence)—What is the firm’s major competitive advantage?
8. Public image—Is the firm responsive to social, community, and environmental concerns?
9. Employees—Are employees a valuable asset of the firm?

Question 7

What is Organizational Culture?

Answer 7

• Organizational culture has been described as the shared values,
  principles, traditions, and ways of doing things that influence the way
  organizational members act.
• All organizations have cultures, but not all cultures influence employees’
  behaviors and actions equally.
• Culture is perception
• Culture is descriptive
• Culture is shared.

Question 8

Which is better, a strong culture or a weak culture?

Answer 8

• Employees are more loyal in
  organizations with strong cultures,
• Organizations with strong cultures are
  associated with high performance.
• If values are clear and widely accepted, employees know what they’re
  supposed to do and what’s expected of
  them,
• However, the drawback is that a strong
  culture also might prevent employees
  from trying new approaches especially
  when conditions are changing

Question 9

How do you build an organizational culture?

Answer 9

• Through Stories – founder, discoveries,
  great events
• Rituals – ceremonies, rites, events,
  celebrations
• Artifacts and symbols – uniforms, logos,
  pins, awards
• Language – jargon, own acronyms

Question 10

What are the six components of a great company culture?

Answer 10

1. Vision: A great culture starts with a vision or mission statement that articulates a company’s purpose. (Non-profit orgs, Apple, Tesla, Ateneo)
2. Values: Values are the core of its culture. Values offer a set of guidelines on the behaviors and mindsets needed to achieve that vision. (Japanese
   companies)
3. Practices: Values are of little importance unless they are enshrined in a company’s practices. Walk the talk. (Google, Apple)
4. People: No company can build a coherent culture without people who either share its core values or possess the willingness and ability to embrace those values. (stringent recruiting policies, Google)
5. Narrative: Any organization has a unique history — a unique story. And the ability to unearth that history and craft it into a narrative is a core element of culture creation. (Coke, Apple, Ford)
6. Place: Whether geography, architecture, or aesthetic design — impacts the values and behaviors of people in a workplace. (Silicon valley, Wall St.)

Question 11

What is BHAGs?

Answer 11

Big Hairy Audacious Goals

• A clear and compelling unifying point of
  effort and a catalyst for team spirit
• Looks at a long-term goal for the company
• Has a clear finish line
• Not a “sure shot”  more of a stretch target
• A powerful mechanism to create a sense of urgency and a goal to rally around

Question 12

Four types of BHAGs

Answer 12

• Target-oriented BHAG
• Competitive BHAG
• Role-Model BHAG
• Internal Transformation BHAG

Question 13

What is External Analysis?

Answer 13

• Also called Environmental Scanning or
  Industry Analysis Focuses on identifying,
  analyzing and evaluating trends and
  events beyond the control of a single firm
• The external analysis is aimed at
  identifying key variables that offer
  actionable responses
• Reveals key opportunities and threats
  confronting an organization so that
  managers can formulate strategies to take advantage of the opportunities and avoid or reduce the impact of threats

Question 14

What are the five key external factors?

Answer 14

1. Economic factors
2. Social, Cultural, Demographic, Natural
   Environment factors
3. Political, Governmental, and Legal
   factors
4. Technological factors
5. Competitive factors

Question 15

What are economic factors?

Answer 15

How economic conditions shift supply and demand to directly affect a
company. This includes economic growth or decline and changes in
inflation and interest rates

Question 16

Impact of a healthy stock market…

Answer 16

1. Stock prices of listed companies are increasing
2. Investors and consumers have more wealth
3. There is general bullishness and optimism about the future
4. Confidence leads to increased spending and investments
5. Increased consumer purchases
6. Increases earning for businesses
7. Over-all GDP growth

Question 17

Impact of increasing disposable income and consumer spending….

Answer 17

1. Households have more money to save or spend
2. Growth in consumption
3. Increase demand for products
4. Good for companies
5. More employment

Question 18

Impact of a strong dollar to the Philippine economy…

Answer 18

1. Makes imported goods more expensive
2. Purchase of raw materials from other countries now more expensive
3. Higher production cost leading to higher prices
4. Good for OFWs
5. Discourages Filipinos from travelling abroad and spending money
6. Leads to higher oil prices because oil globally is priced in U.S. dollars
7. But may boost local tourism industry

Question 19

Impact of the pandemic on the economy…

Answer 19

1. Shortened operating hours
2. Limited mobility
3. Lower demand
4. Additional operating costs
5. Limited capacity in establishments
6. Supply chain disruptions
7. Need for delivery and take-out options
8. Unemployment and business closures

Question 20

What are Social, Cultural, Demographic, Natural Environment factors?

Answer 20

*Emerging trends and patterns in population analytics, demographics, and customer behavior that may indicate changes in customer needs and wants

Question 21

What are Political, Governmental, and
Legal factors?

Answer 21

• The increasing global
  interdependence among economies, markets, governments, and organizations
  makes it imperative that firms
  consider the possible impact of
  political variables on the
  formulation and implementation
  of competitive strategies.

Question 22

What are technological factors?

Answer 22

New technologies are fueling innovation in many industries, and impacting strategic-planning decisions

Question 23

Technology is fueling innovation and
digitalization in the following key
sectors:

Answer 23

*Online Media - advertising, gaming, video and music streaming
*E-commerce - buying and selling of goods, online marketplace
*Ride-Hailing and Logistics - parcel and food delivery, and transport services
*Online Travel - flights, vacation, hotel
rentals
*Digital Financial Services - payments,
remittances, lending, investments,
insurance

Question 24

What is the External Factor Evaluation (EFE) Matrix?

Answer 24

Summarizes and evaluates the external factors: STEP-C

Question 25

How does the External Factor Evaluation (EFE) Matrix work?

Answer 25

1. List 20 key external factors
   identified in the external audit
   process.
2. Assign a weight from 0.0 to 1.0 for
   each factor. Sum of all weights
   must be equal to 1.
3. Rate the effectiveness of firm’s
   current strategies from 1-4 vs. each
   factor. (1 is poor, 4 is superior.)
4. For each factor, multiply weight by
   rating.
5. Sum weighted scores.
6. The higher the total score the
   better the strategies

Question 26

What is the Competitive Profile Matrix (CPM)?

Answer 26

• Identifies firm’s major competitors and their strengths & weaknesses
• CPM uses critical success factors to be successful in the industry which
  include both internal and external factors.
• A weight is assigned from 0.0 to 1.0 for each factor. Sum of all weights
  must be equal to 1.
• Compares a company to its competitors, revealing relative strengths
  and weaknesses
• Each firm is ranked vs. competitors (from 1 to 4) based on Critical
  success factors and reveals areas for improvement

Question 27

What is the summary of Session 5: External analysis?

Answer 27

• Increasing turbulence in industries means that external analysis has become a vital part of the strategic management process.
• Firms that do not do external analysis may fail to anticipate emerging opportunities and threats and may pursue ineffective strategies and miss opportunities.
• Quantified, organized, prioritized, and
  actionable external information is a key
  ingredient for making decisions that result in winning strategic plans and sustained competitive advantages.