Test 1 Flashcards
Romantic View of Leadership
situations in which the leader is the key force in determining the organization’s success, or lack thereof
External Control View of Leadership
situations in which external forces (where the leader has limited influence) determine the organization’s success
Strategic Management
analyses, decisions and actions an organization undertakes in order to create and sustain competitive advantages
Operational Effectiveness
performing similar activities better than rivals
Four Key Attributes of Strategic Management
Directs the organization toward overall goals and objectives (thinking about the company as a whole)
Includes multiple stakeholders in decision making
Requires incorporating both short-term and long-term perspectives
Recognition of trade-offs between effectiveness (the right thing) and efficiency (doing things right)
Ambidexterity
the challenge for managers to take advantage of existing product markets and proactively exploring new opportunities
Intended Strategy
organizational decisions are determined only by analysis (no unforeseen environmental developments…etc)
Realized Strategy
combination of deliberate and emergent strategies
3 Key Strategic Management Processes
Strategy analysis
Strategy formulation
Strategy implementation
Strategy Analysis
study of firms’ external and internal environments and their fit with organizational vision and goals
Strategy Formulation
decisions made by firms regarding investments, commitments and other aspects of operations that create and sustain competitive advantages
Strategy Implementation
actions made by firms that carry out the formulated strategy
Corporate Governance
the relationship among various participants in determining the direction and performance of corporations (management, shareholders and board of directors)
Zero-sum
Zero-sum: employees wants higher wages, but that drives down profits. Suppliers want higher prices for their goods and slower and more flexible delivery times, which drives up costs
Triple Bottom Line
financial, social and environmental performance
Local-line Leaders
significant profit and loss responsibility
Executive Leaders
champion and guide ideas, create learning infrastructure and establish a domain for taking action
Internal Networkers
generate power through clarity and conviction of their ideas
Hierarchy of Goals
organizational goals that range from more broad and less specific, to more specific and measurable (strategic goals-mission statement-vision)
Vision
organizational goal(s) that evoke(s) powerful and compelling mental images
Mission Statement
set of organizational goals that include the purpose of the organization, its scope of operations and the basis of its competitive advantage
Strategic Objectives
organizational goals that are used to achieve the mission statement
Objectives must be…
Measurable Specific Appropriate Realistic Timely
Perceptual Acuity
the ability to sense what is coming before the fog clears
3 Parts that Make up Forecasts
Environmental Scanning
Environmental monitoring
Competitive intelligence
Environmental Scanning
surveillance of external environment to predict environmental changes and detect changes already under way (looking at P&G numbers for consumer spending)
Environmental Monitoring
tracking the evolution of environmental trends, sequences of events or streams of activities (looking at CPI or net disposable income)
Competitive Intelligence
collecting and interpreting data on competitors and identifying their strengths and weaknesses
Scenario Analysis
an in-depth approach to environmental forecasting that involves experts’ detailed assessments of societal trends and more
SWOT Analysis
Strength, Weaknesses (Internal), Opportunities and Threats (External)
Porter’s Five Forces
Threat of new entrants
Bargaining power of buyers
Bargaining power of suppliers
Threat of substitute products and services
Intensity of rivalry among competitors in an industry
Economies of Scale
decreases in cost per unit as absolute output per period increases
Product Differentiation
the degree to which a product has strong brand loyalty or customer loyalty
Powerful Buyer Group when…
Most of supplier's sales are from one buyer Products are undifferentiated Buyer faces few switching costs It earns low profits (need lower costs) Pose a threat of backward integration
Powerful Supplier Group when…
The group is dominated by a few companies
There are few or no substitutes
The industry is not an important customer of the supplier group
The supplier’s product is an important input to the buyer’s business
Their products are differentiated
The supplier group poses a credible threat of forward integration
Zero-sum Game
situation with multiple players and winners win only by taking from other players
Strategic Groups
clusters of firms that share similar strategies
Value-Chain Analysis
views the organization as a sequential process of value-creating activities
Five Primary Activities
inbound logistics-receiving, storing and distributing inputs of a product
operations- all activities associated with transforming inputs into the final product
outbound logistics-collecting, storing and distributing the product or service to buyers
marketing and sales- activities associated with purchases of products and services by end users and the inducements used to get them to make purchases
service-actions associated with providing service to enhance or maintain the value of the product
4 Support Activities
Procurement
technology development
human resource management
general administration
Resource-Based View
firm’s competitive advantages are due to their strategic resources that are valuable, rare and costly to substitute
VRIN Model
Valuable
Rare
Inimitable
Non-substitutable
Path Dependency
characteristics of resources that are developed through a unique series of events
Casual Ambiguity
a characteristic of the firm’s resources that is costly to imitate because a competitor cannot determine what the resource is or how it was created
Social Complexity
being a great company to work for also makes you a great company to work with
