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Mgmt Module 2
Segment 6
| Question | Answer |
|---|---|
| macro environment | includes factors affecting all organizations |
| organization's environment | all forces outside the firm's abstract boundaries |
| competitive environment | includes Porter's Five Forces in an industry: buyer power, supplier power, substitutes, new entrants, and rivalry |
| strategy | organization's goals and the plans and decisions it adopts to achieve them |
| 3 dynamics of the strategic management process | 1) establishment of mission, value and goals, 2)work on any other boxes, any amount, any time, 3)it is a never ending process |
| efficiency & effectiveness | two indicators of it your strategy is working |
| effectiveness | extent to which the organization achieves its goals |
| how to become more effective | reach a higher number of goals or meet your #1 goal |
| efficiency | organization's outputs and inputs |
| how to become more efficient | increase outputs or decrease inputs or both |
| Icarus Paradox | effectiveness can be dangerous: a company is never more vulnerable to complacency than when its at the height of its success |
| Specific, Measurable, Acceptable, Realistic & Challenging, Timed | goals are SMART |
| match your internal strengths and external opportunities and avoid internal weakness and external threat | the SWOT tool |
| environmental scanning | searching out information that is unavailable to most people and sorting through that information to interpret what is important and what is not |
| competitive intelligence | information necessary to decide how best to manage in the competitive environment they have identified (using environmental scanning) |
| scenario development | helps managers develop contingency plans for what they might do given different outcomes |
| forecasting | method for predicting how variables will change in the future |
| benchmarking | identifying the best-in-class performance by a company in a given area, say, product development or customer service, and then comparing your process to others |
| buffering | creating supplies of excess resources in case of unpredictable needs |
| smoothing | leveling normal fluctuations at the boundaries of the environment |
| competitive aggression | exploiting a distinctive competence or improving internal efficiency for competitive advantage (agressive pricing, comparative advantage) |
| competitive pacification | independent action to improve relations with competitors |
| public relations | establishing and maintaining favorable images in the minds of those making up the environment |
| voluntary action | vountary commitment to various interest groups, causes, and social problems |
| political action | efforts to influence elected representatives to create a more favorable business environment or limit competition |
| cooperative action | strategies used by two or more organizations working together to manage the external environment |
| contraction | negotiation of an agreemnet between the organization and another group to exchange goods, services, information, patents, and so on |
| cooptation | absorbing new elements into the organization's leadership structure to avert threats to its stability or existence |
| coalition | two or more groups act jointly with respect to some set of issues for some period of time |
| strategic maneuvering | an organization's conscious efforts to change the boundaries of its task environment (companies change the environment they are in) |
| domain selection | entering a new market or industry with an existing expertise |
| diversification | a firm's investment in a different product, business, or geographic area (Apple iPod) |
| merger/acquisition | two or more firms combine, or one firm buys another to form a single company |
| divestiture | a firm selling one or more businesses |
| corporate strategy | identifies the set of businesses, markets, or industries in which the organization competes and the distribtuion of resources among those businesses |
| concentration strategy | focuses on a single business competing in a single industry; used to gain entry into an industry when industry growth is good, or when the company has a narrow range of competencies |
| vertical integration strategy | acquisition or development of new businesses that produce parts or components of the organization's product |
| concentric diversification | moving into new businesses that are related to the company's original core business |
| conglomerate diversification | expansion into unrelated businesses |
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