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Pareto > UNIT 1- Introduction to strategic management > Flashcards

UNIT 1- Introduction to strategic management Flashcards

1
Q

The GPS analogy of strategic decisions

A
  1. Where am I?
  2. Where do I want to go?
  3. How do I want to go?
  4. What are the alternatives?
  5. Go
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2
Q

Characteristics of strategic decisions

A
  • long term
  • scope of several organization activities
  • create advantage over competitors
  • fit the business environment (identifying and positioning in the market)
  • consider the expectations of powerful actors (stakeholders)
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3
Q

Implications of strategic decisions

A
  • Complexity (locations of suppliers, geographical scope, technological changes)
  • Uncertainty (the future: competitors, government, etc.)
  • Affect all business decisions (suppliers, logistics, product, technology)
  • Require integrated strategy for all areas of the company
  • Require relationships and networks (all supply chain)
  • Require organization changes (resources and cultural)
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4
Q

The strategy checklist

A
  • strategic position
  • strategic choices
  • strategy in action
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5
Q

Strategic position

A
  • What are the environmental opportunities and threats?
  • What are the organisation’s strengths and weaknesses?
  • What is the basic purpose of the organisation?
  • How does culture fit the strategy?
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6
Q

Strategic choices

A
  • How should business units compete?
  • Which businesses to include in a portfolio?
  • Where should the organisation compete internationally?
  • Is the organisation innovating appropriately?
  • Should the organisation buy other companies, ally or go it alone?
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7
Q

Strategy in action

A
  • Are strategies suitable, acceptable and feasible?
  • What kind of strategy- making process is needed?
  • What are the required organisation structures and systems?
  • How should the organisation manage necessary changes?
  • Who should do what in the strategy process?
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8
Q

Strategic position is concerned with:

A
  • the impact on strategy of the external environment
  • an organization’s strategic capability, and
  • the influence of stakeholders and culture.
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9
Q

The strategic position includes:

A
  1. Environment (opportunities and threats)
  2. Capabilities (resources and competences = strengths and weaknesses)
  3. Purposes (stakeholder expectations)
  4. Culture (cultural and historical influences)
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10
Q

Strategic choices involve:

A
  • corporate and business unit level
  • directions and methods of development
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11
Q

The strategic choices

A
  • Corporate-level (diversification decisions about the portfolio of products and the spread of markets, relationship between the separate parts of the business)
  • Business level (involve pricing and differentiation strategies, how to compete or collaborate with competitors)
  • International strategy
    (diversification into new geographical markets)
  • Evaluation (organic grow, mergers/acquisitions, strategic alliances)
  • Innovation (first-mover or follower)
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12
Q

The strategic in action

A
  • Structuring (to support successful performance)
  • Processes (to control the way in which strategy is implemented: intended and emergent)
  • Resourcing (people, information, finance, technology)
  • Practice (activities involved: people, activities, methodologies)
  • Changing (managing: changes and styles)
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13
Q

Identify and translate customer needs

A
  • What is your Product?
  • Who is your CLIENT?
  • What does the CLIENT want?
  • How can the environment influence (positively and negatively)?
  • What is the value of your business?
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14
Q

What is a vision?

A

A VISION statement is concerned with what the organization aspires to be.

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15
Q

What is a mission?

A

A MISSION statement provides employees and stakeholders with clarity about the overall purpose of the organization.

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16
Q

VMOSA

A

Vision
Mission
Objectives
Strategies
Action

17
Q

Mission definition

A

Overall purpose of the organization (in line with stakeholders’ values and expectations)

Example: Be healthy and fit

18
Q

Vision definition

A

Desired future
(what the organization aspires to be)

Example: To run the NY marathon

19
Q

Goal definition

A

General statement of aim or purpose

Example: Lose weight and do short / middle distance competitions

20
Q

Objective definition

A

Quantification or more precise statement of the goal

Example: Lose 6 kilos in 3 month , run the San Silvestre (10 km) in 6 month, run a half marathon in one year and run a marathon in 1 1/2 year.

21
Q

Strategic capability definition

A

Resources, activities and processes that provide ‘competitive advantage’

Example: Proximity to a fitness center, friends that will train with me, …

22
Q

Strategies definition

A

Long-term direction

Example: Exercise regularly, appropriate diet, participate in short / middle distance competitions

23
Q

Business model definition

A

How goods, service, information and material ‘flow’ between participating parties

Example: Join running club, following or consulting a nutritionist

24
Q

Control definition

A

Monitoring of action:
● assess effectiveness of strategies and actions
● modify as necessary strategies and/or actions

Example: Monitor weight, kilometers run and measure times. If progress satisfactory, do nothing. If not, consider other strategies and actions

25
Q

Corporate-level strategy

A

Corporate-level strategy is concerned with the overall scope of an organisation and how value is added to the constituent business units.

The top of the strategy triangle

26
Q

Business-level strategy

A

Business-level strategy is concerned with the way a business seeks to compete successfully in its particular market.

The middle of the strategy triangle

27
Q

Operational strategy

A

Operational strategy is concerned with how different parts of the organisation deliver the strategy, managing: resources, processes and people.

The bottom of the strategy triangle

28
Q

What is stakeholders?

A

STAKEHOLDER is everybody that can be affected by a company or its strategy, in a good or bad way.

Internal stakeholders:
- employees
- manager
- owners

External stakeholders:
- suppliers
- society
- government
- creditors
- shareholders
- customers

29
Q

Types of stakeholders

A
  • internal stakeholders
  • external stakeholders
30
Q

4 types of external stakeholders

A

– Economic (e.g. suppliers; shareholders, banks)

– Social/political (e.g. government agencies)

– Technological (e.g. standards agencies)

– Community (e.g. local residents)

31
Q

Stakeholders of a large organization

A
  • owners/shareholders
  • financial community
  • activist groups
  • customers
  • managers
  • unions
  • employees
  • trade associations
  • competitors
  • suppliers
  • government
  • political groups
32
Q

stakeholder mapping

A

identifies stakeholder interest and power and helps in understanding political priorities.

33
Q

Stakeholder mapping issues

A
  • Determining purpose and strategy – whose expectations need to be prioritised?
  • Who are the key blockers and facilitators of strategy?
  • Is it desirable to try to reposition certain stakeholders?
  • Can the level of interest or power of key stakeholders be maintained?
  • Will stakeholder positions shift according to the issue/strategy being considered?
34
Q

Power

A

Power is the ability of individuals or groups to persuade, induce or coerce others into following certain courses of action.

35
Q

Sources of power- within organizations

A
  1. Hierarchy (formal power)- e.g. autocratic decision making
  2. Influence (informal power)- e.g. charismatic leadership
  3. Control of strategic resources- e.g. strategic products
  4. Possession of knowledge and skills- e.g. computer specialists
  5. Control of the human environment- e.g. negotiation skills
  6. Involvement in strategic implementation- e.g. by exercising discretion
36
Q

For external stakeholders

A
  1. Control of strategic resources- e.g. materials, labour, money
  2. Involvement in strategy implementation- e.g. distribution outlets, agents
  3. Possession of knowledge or skills- e.g. subcontractors, partners
  4. Through internal links- e.g. informal influence
37
Q

Corporate social responsibility (CSR)

A

is the commitment by organisations to behave ethically and contribute to economic, social and environmental development, while improving the quality of life of their stakeholders.

38
Q

The “triple-bottom-line”

A

is the balance of economic, environmental and social imperatives while at the same time addressing the expectations of shareholders and stakeholders.

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