Topic 5 Flashcards

1
Q

Strategy to ________ how an organization to _______ its own capabilities with the opportunities in the market place to _______ its objectives

A

specify

match

accomplish

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2
Q

Strategy to _______ how an organization can create value for its customers while differentiating itself from its competiors.

A

describe

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3
Q

To _______ its strategy, an organization must first thoroughly understand its industry: 5 forces: competitors, potential entrants into the market, equivalent products, barganing power of customers, and bargaining power of input suppliers

A

formulate

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4
Q

To ______ to these challenges, the company must choose between two basic strategies: differentiating its product or achieving cost leadership

A

respond

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5
Q

Product differentiation to _____ products or services its customere perceive to _______ superior and unique

A

offer

be

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6
Q

Managers use differentiation to ________ brand loyalty and _______ higher prices.

A

increase

charge

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7
Q

Cost leadership is to _______ lower costs relative to competitors through productivity and efficiency improvements, elimination of waste, and tight cost control.

A

achieve

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8
Q

To _______ the success of its strategy, a company must trace the sources of its profitability to product differentiation or cost leadership.

A

evaluate

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9
Q

To _______ cost leadership strategy, the company must further improve its own internal capabilities

A

achieve

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10
Q

Reengineering is the fundamental rethinking and redesign of business processes to ______ improvements in critical measures of performance, such as cost, quality, service, speed, and customer satisfaction.

A

achieve

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11
Q

To _____ successful, reengineering efforts must focus on an entire process, change roles and responsibilities, eliminate unnecessary activities and tasks, use information technology and develope employee skills

A

be

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12
Q

Balance scorecard translates an organization’s mission and strategy into a set of performance measures to _______ the framework for implementing its strategy.

A

provide

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13
Q

Balance scorecard to ________ financial objectives and its also highlights the nonfinancial objectives to _______ and _______ its financial objectives

A

achieve

meet

sustain

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14
Q

The set of measures used to _______ performance depend on strategy is called a “ a balanced scorecard”

A

trace

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15
Q

Balance scorecard to __________ the use of financial and nonfinancial performance measures to ________ short-run and long-run performance in a single report

A

balance

evaluate

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16
Q

Strong improvement in nonfinancial measures usually to _________ future economic value

A

create

17
Q

A strategy map is a diagram to _______ how an organization creates value by connecting strategic objectives in explicit cause-and-effect relationships with each other in the financial, customer, internal-business-proces, and learning-and-growth perspecitives.

A

describe

18
Q

The strategy map help to ________ whether these activities are generating financial returns

A

evaluate

19
Q

Finanacial perspective to _______ the profitability of the strategy and the creation of shareholder value

A

evaluate

20
Q

Customer perspective to _______ targeted customers and maret segments and to _______ the company’s success in these segments

A

identify

measure

21
Q

Internal - business - process perspective focuses on internal operations to _______ value for customers that, in turn, help to ______ financial performance

A

create

achieve

22
Q

The problems with non-financial performance measures

- Wide choice of non-financial _______ available

- Their development can be _______ and undirected

- Managers must necessarily make trade-offs between achieving some measures and not others

- Some measures lack integrity

+ Accuracy of the data, opportunity for manipulation

- Some measures not easily translated into financial outcomes

A

measures

ad-hoc

23
Q

VISION AND MISSION

- Before determining the objectives and measures, an organization should already have a ______ and ______ statement

+ And a general idea of its strategy

- These high-level statements can then be translated into detailed objectives and measures

- The exact definitions of vision and mission can vary, but the following examples should provide helpful guidelines

A

vision

mission

24
Q

VISION

  • A concise statement that defines the mid to long-term (______ year) goals of the organization
  • The vision should be ______ and ________ and should express, often in colorful or “visionary” terms, how the organization wants to be perceived by the world
A

3 - 10

external

market-oriented

25
Q

MISSION

  • A concise, _________ statement of how the organization expects to compete and deliver value to customers
  • It often states the reason for the organization’s existence, the basic purpose towards which its activities are directed, and the values that guide employee’s activities
A

internally-focused

26
Q

PUTTING VISION IN ACTION

  • The Vision and Mission set the general direction for the organization

    + They are intended to help shareholders, customers, and employees ________ what the company is about and what it intends to achieve
  • But these statements are far too vague to guide day-to-day actions and resource allocation decisions
  • Companies start to make the statements operational when they define a strategy of how the vision and mission will be achieved
A

understand

27
Q

STRATEGY AND THE BSC

It identifies and makes explicit the hypotheses about ____________ relationships between:

- Outcome measures in the Financial and Customer perspectives

+ E.G., ROI and customer loyalty

- and the _________ of those outcomes that are measured in the Internal and Learning & Growth perspectives 

+ Such as zero defect processes, short cycle times, and skilled, motivated employees

A

the cause and effect

performance drivers

28
Q

OBJECTIVES

  • Are concise statements that articulate what the organization hopes to accomplish
  • Best stated as action phrases

    + May include the means and the desired results
  • Tell the story of the strategy through the cause-and-effect relationships in each of the four balanced scorecard perspectives

E.g: ________

A

Obj. 1=> To achieve a 40% market share within 5 years.

Obj. 2=> To achieve an ROI of 10% within 5 years.

29
Q

Typical objectives found in each of the four BSC perspectives include:

- Increase revenues through expanded sales to existing customers ( __________ perspective)

- Become service oriented ( __________ perspective)

- Achieve excellence in order fulfillment through continuous process improvements ( _________ perspective)

- Align employee incentives and rewards with the strategy ( _________ perspective)

A

Financial

Customer

Internal

Learning & Growth

30
Q

MEASURES

  • Describe how ________ in achieving an objective will be determined.
  • Provide specificity and reduce the _________ that is inherent in word statements
  • Specifying exactly how an objective is measured will give employees a __________ focus for their improvement efforts
  • Once the objectives have been translated into measures, managers select _________ for each measure
A

success

ambiguity

clear

targets

31
Q

NON-FINANCIAL MEASURES for OPERATIONAL CONTROL

- Customer satisfaction

---> Measured by survey administered to customers

- \_\_\_\_\_\_\_\_\_\_ measures

---> Measurement of faults in a product that occur during the manufacturing process

---> Support a \_\_\_\_\_\_\_\_\_ strategy

- Quality

---> Periodic inspections or testing of products

- Accident report

---> Safety statistics

- Multi-skilling

---> Number of employees who have attained skills to allow them to undertake a range of operational tasks

- Machine downtime & Productivity

---> Number of hours, or percentage of total production hours, that machines are unable to operate

---> Labour Productivity

- Delivery on time

---> Prompt delivery to customers is an important driver of customer value
A

Defect

high-quality

32
Q

FINANCIAL PERSPECTIVE

  • Reflects perspective of the shareholder
  • Summarises the financial outcomes of decision and actions
  • Measures include various cost and product measures, __________, cash flow measures, shareholder value measures.
A

return on investment

33
Q

CUSTOMER PERSPECTIVE

- Measures the company’s success in ________ customer value

- Outcome (lag) measures include customer profitability, market share, number of _________.

- Lead indicators include on-time delivery, number of defects

A

achieving

new customers

34
Q

INTERNAL BUSINESS PROCESSES

- Objectives relate to ________ processes that contribute to achieving customer and financial objectives

- Processes critical to delivering products to customers and achieving financial strategies

- Product design, operations, marketing, sales, customer service processes

- Measures of cost, product quality, time-based measures, ________ development

A

specific

new product

35
Q

LEARNING AND GROWTH

  • Focuses on the capabilities of the organisation to achieve ____________ that create both customer and shareholder value.
  • To deliver long-term growth and ________
  • Measures focus on employee capabilities, capabilities of information systems and organisational climate
  • Employee satisfaction, training, skills, employee suggestions
A

superior internal processes

improvement

36
Q

Measures in the balanced scorecard provide balance between

- Short-term and ________ objectives

- Financial and customer measures, and measures of business processes, and learning and growth

- Objective and easily quantified measures and subjective performance measures

- Outcome measures and _______ of those outcomes, i.e. lead and lag measures.

A

long-term

drivers

37
Q

LAG INDICATORS

  • Monitor progress towards the organisation’s ________.
  • Difficult to monitor directly
  • Summary financial measures, market share, customer satisfaction
A

objectives

38
Q

LEAD INDICATORS

  • Measures that drive the outcomes and provide information that is actionable and manageable
  • Relate to the _______ and _______ of the business
  • Improvements in these measures should, over time, flow through to improvements in lag indicators
A

processes

activities