strategic management Flashcards
What does the resource-based view focus on?
The resources of a company that enable it to attain competitive advantage
Resources are categorized as tangible and intangible.
Define core competency.
A collection of competences that cross divisional boundaries and is widespread throughout the corporation.
What is a distinctive competency?
Core competencies that are superior to those of the competition.
What are strategic capabilities?
The resources and competences of an organization needed for it to survive and prosper.
What is competitive advantage?
An attribute that allows an organization to outperform its competitors.
List the four components of the VRIO framework.
- Valuable
- Rareness
- Imitability
- Organization
What does the ‘Valuable’ component of VRIO assess?
Does it provide customer value and competitive advantage?
What is the definition of a business model?
A company’s method for making money in the current business environment.
What are the five elements typically composed in a business model?
- Who it serves
- What it provides
- How it makes money
- How it differentiates and sustains competitive advantage
- How it provides its product/service
Define value chain.
A linked set of value-creating activities that begin with basic raw materials and end with the final goods reaching the consumer.
What are the two segments of the value chain in the petroleum industry?
- Upstream
- Downstream
What is corporate culture?
The collection of beliefs, expectations, and values learned and shared by a corporation’s members.
What does cultural intensity refer to?
The degree to which members of a unit accept the norms, values, and other cultural content associated with the unit.
What is the purpose of the balanced scorecard?
To combine financial measures with operational measures on customer satisfaction, internal processes, and innovation.
What is activity-based costing?
Allocates indirect and direct costs to individual product lines based on value-added activities.
What does shareholder value measure?
The present value of anticipated future cash flows from the business plus the value of the company if liquidated.
What are key performance indicators (KPI)?
Critical indicators of progress towards a desirable outcome.
What are the three types of controls in management?
- Output controls
- Behaviour controls
- Input controls
What is the importance of the center of gravity in the value chain?
It indicates the part of the chain that is most important to the company and where its core competencies lie.
True or False: The VRIO framework includes the concept of Transparency.
True
Fill in the blank: A _______ is a graph showing time plotted against the sales of a product as it moves from introduction through growth and maturity to decline.
[Product life cycle]
What are the functions of corporate culture?
- Conveys a sense of identity for employees
- Generates employee commitment
- Adds to the stability of the organization
- Serves as a frame of reference for employees
What is the definition of performance in a business context?
The end result of activities.
What are some obstacles to effective control in performance measurement?
- Difficulty in developing appropriate measures
- Lack of quantifiable objectives
- Inability to use information systems
What does the economic value-added (EVA) measure?
The difference between pre-strategy and post-strategy values for the business.
What are typical liquidity ratios used for?
To measure a company’s ability to pay short-term obligations.
What is the role of benchmarking in performance evaluation?
To measure products, services, and practices against the toughest competitors.
