Vocabulary Flashcards
What is the planning process?
1 .Define your objectives
2. Determine where you are in your objectives
3. Anticipate future events
4. Consider alternatives and make your plan
5. Consider alternatives and make your plans
6. Implement your plan and evalulate the results
Benefits of planning
- Improved Flexibility
- Improved coordination and control
- Better use of time
Long term Planning and who develops the plans
Objectives that will be accomplished in the future (more than a year away)
Top level manager develop long term plans
Short Term Planning Tools
Plans that will be completed in a year or less by middle/lower level managers
Policies
Rules/guidelines for decision making usually many policies are set in place
Operational plans
-helps display a clear understanding of day to day tasks (how an organization operates)
-helps employees reach the organization’s basic objectives
Rational Comprehensive Plan
Main idea is to make a perfect plan with data
Logical decision making using data and math models
Incrementalism Planning
Time efficient using gut decision and little data
Collectivist Planning
Combo of incrementalism and rational comprehensive planning
Budgeting
Plan with money and resources to ensure no over spending and the company is profitable
Allocate resources
Strategic Plans
Organization’s vision (organization’s purpose and what it hopes to be in the future)
Forecasts
Long term predictions
Trying to predict the company’s future profits,revenues, cost since they significantly change the companies value
Participatory Planning
Including the interests/values of share/stakeholders in the company that often lead to creativity or informed decisions
Benchmarking
Comparing both external and internal from other companies companies to make improvements in the future
Observe others and incorporate their idea or learn from their mistakes to become more successful
Scenario Planning
Identifying possible events or occurrences in the future to develop plans to deal with them if they happen
Help organization deal with them quickly and efficiently with a change
What is Strategy?
Comprehensive action plan that identifies long range direction of the organization
Guides how they make use of their resources (money, capital resources)
Competitive advantages
Is a position in which an organization performs better than their competitors allowing them to secure their customers
Examples of competitive advantages
- Low Cost
2.Quality
3.Knowledge - Speed Quick to market advantage
- Barrier to entry
- Financial position advantage
What are the levels of strategic planning and who is in charge?
- Corporate (Top Level Manager)
- Business (Middle Manager)
- Functional (front-line manager and supervisors)
Level Of Strategic Planning
1.Corporate strategy (What business are we in?)
2.Business Strategy (How do we compete in each major business?)
3.Functional Strategy (How do we best support each of our best strategies?)
How do managers make decisions?
By seeing the environment
Certain environments:
Offer complete information about possible action alternatives and their outcomes.
Risk environments:
Lack complete information about action alternatives and their consequences, but offer some estimates of probabilities of outcomes for possible action alternatives.
Uncertain environments:
Information is so poor that probabilities cannot be assigned to likely outcomes of known action alternatives
Strategic Planning Managment Tools
Porter’s Five Forces Model
Corporate Culture
Porter’s Five Forces Model
Competition in the industry
New Entrants threat in industry
Threat of existing substitutes
Power of Suppliers
Power of Customers
Corporate Culture
The outer perspective -observable culture
inner perspective-core culture.
Globalization strategy
-world is one large market;standardize products and advertising as much as possible
-ethnocentric view
Multidomestic strategy
Customize products and advertising to local markets as much as possible
Polycentric view
Transnational view
Balances efficiencies in global operations and responsiveness to local markets
Geocentric view
Strategic alliances
Two or more organizations partner to pursue an area of mutual interests
Types of strategic alliances
Outsourcing alliance
Supplier alliance
Distribution
what is the E- business strategies
The strategic use of the internet to gain competitive advantage
Popular e-business strategies
Business to business (B2B) strategies
Business to customer (B2C) strategies
Programmed decision
Apply solutions that are readily available from past experiences to solve structured problems
Non-programmed decision
Develop novel solutions to meet the demands of the unique situation that presented unstructured problems
Crisis Decision Making
A crisis that involves an unexpected problem that can lead to disaster if not resolved quickly and appropriately
Systematic thinking
Approaches the problems in a rational, step by step and analytical fashion
Intuitive thinking
Approaches problems in a flexible and spontaneous fashion
Multidimensional thinking
Applies both intuitive and systemic thinking
Organic Growth
Internal growth from existing operations
Inorganic growth
Growth through acquisition or expansion
Concentration Strategies
Trying to compete successfully within a single industry
Diversification Strategies
Related or unrelated products or services or vertical integration
Growth
Attempts to expand the business
Retrenchment
Fixes problems and identifies weakness
Stability
Maintain status quo
Why is the porter’s five forces used?
This tool to better comprehend the market conditions they face
