Strategy Module 4 - Business Strategies and the Strategic Planning Process Flashcards
What is a business strategy and what question does it address?
A business strategy builds a competitive focus in one line of a business and addresses the question, “how do we win in this market?”
What is an intended strategy?
The agreed-upon strategy arrived at through the formal planning process.
What is an emergent strategy?
A strategy created from new ideas and conditions.
What is a discarded strategy?
A strategy that deemed inappropriate due to changing circumstances.
What is a realized strategy?
The implemented plan, or “what actually happened.”
What does the strategic planning process define?
The organization’s future direction, permanence targets, and approaches to achieve the targets in a formal written statement.
What are the steps of the strategic planning process?
- Establish the mission, vision, and values
- Develop objectives
- Analyze the external environment
- Identify the competitive advantage
- Determine the competitive position
- Implement the strategy
- Evaluate the performance
What is a mission statement?
An articulation of a view of a realistic, credible, and attractive future for the organization that clearly states the reason for the existence of the business and differentiates the organization from the competition.
What is a vision statement?
A clear compelling statement about the future that serves to unite an organization’s efforts.
What is the purpose of a values statement?
- Conveys a sense of identity for employees
- Generates employee commitment to something greater than themselves
- Adds to the stability of the organization as a social system
- Serves a frame of reference for employees to make sense of organizational activities and to use a guide for appropriate behavior.
What is the purpose of a balanced scorecard?
They organize objectives into four categories: financial, customer, learning and growth, and internal business process.
What is SWOT analysis?
A SWOT analysis is an environmental analysis that examines the strengths and weakness of a company (the internal environment) as well as its threats and opportunities (external environment).
What is a competitive advantage?
A firm’s characteristics that enable it to earn higher rates of profits than its competitors by utilizing its resources.
What resources does an organization have at its disposal?
- Tangible assets (assets that have substance and can consumed)
- Intangible assets (assets that are not concrete, such as reputation)
- Capabilities (the collective skills, abilities, and expertise, and core competencies)
What is a value proposition?
A statement of benefits your products or services provide in the marketplace.
What are the five competitive strategies in Porter’s Model?
- Low-cost leader strategy
- Broad differentiation strategy
- Best-cost provider strategy
- Focused, or market-niche, strategy based on differentiation
- Focused, or market-niche, strategy based on lower cost
What is the low-cost leader strategy? Give an example.
Overall low-cost provider of a product/service that appeals to a broad range of customers.
Example: Sam’s Club or Walmart
What is the broad differentiation strategy? Give an example.
Differentiate the product offerings from rivals’ that appeal to a broad range buyers.
Example: Whole Foods
What is the best-cost provider strategy? Give an example.
More value for the money by emphasizing both low cost and upscale difference.
Example: Ikea
What is the focus, or market-niche, strategy based on differentiation? Give an example.
Targets a niche market based on differentiation and likely provides a very high end product that only a small segment would desire.
Example: Rolls-Royce
What is the focus, or market-niche, strategy based on lower cost? Give an example.
Targets a niche market based on a lower cost.
Example: Maybelline
What is strategic implementation?
The operation planning process consisting of programs, budgets, and procedures.
In terms of strategic implementation, what is a budget?
The financial resources need to accomplish the goal.
in terms of strategic implementation, what is a program?
The steps or activities necessary to accomplish a goal.
In terms of strategic implementation, what is a procedure?
The steps required to get a job done.
What are some indicators when evaluating performance?
Financial, Operational, Other
What are some errors in strategic planning?
Not involving key people.
Failing to use the plan developed in the strategic planning process as a guide.
Failing to align incentives, other HR programs and policies to the achievement of strategy.
What is governance?
Governance establishes who has power, who makes decisions, who is accountable for carrying out those decisions, and how others are heard.
What does governance do?
Ensures decisions are made in line with the organization’s policies, guidelines, philosophies and cultural norms.
Guards against conflicts of interest.
Ensures everyone has access to due process.
