Chap 6 Core Concepts of Management

what is a competitive advantage?
A competitive advantage comes from operating and successful ways that are difficult to imitate.
What is a strategy?
A strategy is a comprehensive plan that sets direction and guides the allocation of resources to achieve long-term objectives.
The strategic management?
Strategic management is the process of formulating and implement strategies.
Name the two major responsibilities in strategic management
strategy formulation: this involves assessing existing strategies, organization, and environment to develop new strategies in strategic plans capable of delivering future competitive advantage.
Strategy implementation: once strategies are created they must be acted upon successfully to achieve the desired results.
What is a mission?
The mission of the organization is its reason for existence as a supplier of goods and services to society. A good mission statement is precise and identifying the domain in which the organization intends to operate including the customers in intends to serve, the products and services it provides, and the location it intends to operate. Should also communicate the underlying philosophy that will guide these operations.
What our stakeholders?
Stakeholders are those directly affected by an organization and its accomplishments. These are employees and members of the external environment, customers, shareholders, suppliers, creditors, PD groups. In a strategic constituencies these analysis the specific interests of each stakeholder are assessed along with the organization's record and responding to them
what is a corporate culture?
Corporate culture is the predominant value system for the organization as a whole.
What are operating objectives?
Operating objectives are specific results that organizations try to accomplish. They are shorter-term targets against which actual performance can be measured. Examples of business operating objectives include: profitability, market share, human talent, financial health, cost efficiency, product quality, innovation, social responsibility.
What is a SWOT analysis?
This analysis examines organizational strengths and weaknesses and environmental opportunities and threats. A major goal is to identify core competencies in the form of special strings. Their capabilities that by virtue of being rare, costly to imitate, and non-substitutable become viable sources of competitive advantage.
What is a core competency?
A core competency is a special string that gives an organization a competitive advantage. They may be found in special knowledge or expertise, superior technologies, efficient manufacturing technologies, or unique product distribution. The goal is to create strategies that leverage core competencies for competitive advantage by building upon the organization's strengths.
What are weaknesses in the SWOT analysis
weaknesses may be identified in such things as the emergence of new competitors, resource scarcities, changing customer case, and new government regulations.
Name Michael Porter's five forces model for competitive industry analysis?
1. Industry competitors
2. New entrants: threats of new competitors entering the market
3. Suppliers: bargaining power of suppliers
4. Customers
5.Substitutes: threats of substitute products or services
what is an unattractive industry?
Unattractive industry is one in which rivalry among competitors intense, substantial threats exist in the form of possible new entrants and substitute products, and the suppliers and buyers are very powerful bargaining over such things as process and quality
what is an attractive industry?
an attractive industry has less existing competition, few threats from new entrants or substitutes, and no bargaining power among suppliers and buyers
what is a corporate strategy?
A corporate strategy sets long-term direction of the total enterprise
what is a business strategy?
A business strategy identifies how a division or strategic business unit will compete in its product or service domain. It describes strategic intent with respect to a given industry or market. The term strategic business unit SBU. Is often used to describe such divisions would operate with separate missions within a large enterprise
what is a functional strategy?
A functional strategy guides activities within one specific area of operations. This level of strategy focuses on activities within a specific functional area of operations, such as marketing, manufacturing, finance, human resources.
What is a growth strategy?
A growth strategy involves expansion of the organization's current operations. Some organizations grow through concentration: that is by using existing strengths in new and productive ways without taking the risks of great shifts in direction. Others grow through paper syndication, the acquisition of or the investment in new businesses in unrelated areas.
What is a retrenchment strategy?
A retrenchment strategy involves reducing the scale of current operations. It is a turnaround strategy of downsizing to reduce costs and restructuring to improve operating efficiency. Retrenchment by the investor involves selling parts of the organization to refocus on core competencies, cut costs. Retrenchment by liquidation involves closing operations to the complete sale of assets or the declaration of bankruptcy.
What is a stability strategy?
A stability strategy maintains the present course of action. Is sometimes pursued when an organization is doing well and the environment is not perceived to be changing. It can also be used as a time to consolidate organizational strength after a period of growth or retrenchment
what is a strategic alliance?
A strategic alliance organizations joined together in partnership to pursue an area of mutual interest. One way to cooperate strategically is through outsourcing alliances contracting to purchase important services from another organization.
What is an E business strategy?
this strategy uses the Internet to gain competitive advantage
what is portfolio planning?
A portfolio planning approach seeks the best mix of investments among alternative business opportunities.
What are the major opportunities for competitive advantage?
Cost and quality, knowledge and timing, barriers to entry, financial resources
what is a BGC matrix?
this matrix analyzes business opportunities according to market growth rate and market share. It ties strategy formulation to an analysis of business opportunities according to market growth rate and market share. It includes four possibilities went to possible strategic direction.
What are the four possibilities in a be see BGC matrix?
1. Stars are high market share businesses in high-growth markets. Recommended strategy equals growth add resources and build the business further based on marker productions
2. Question marks are low market share businesses in high-growth markets. Recommendation equals growth or retrenchment apply resources to accomplish positive turnaround
3. Cash cows are high market share businesses in low growth markets. Recommendation equals ability or modest growth to maintain benefits of strong cash flow while keeping resource investment minimum
4. Dogs are low market share businesses and low growth markets. Recommendation equals retrenchment, divest, sell, liquidate
Michael Porter's generic strategies framework
1. Differentiation: the organization's resources and attention are directed towards distinguishing its products from those of the competition
2. Cost leadership: what organization's resources and attention are directed towards minimizing cost operate more efficiently than the competition
3. Focused differentiation: what organization concentrates on one special market segment and tries to offer customers in that segment a unique product
4. Focused cost leadership or the organization concentrates on one special market segment and tries to that segment to be the provider with lowest costs
what is a differentiation strategy?
A differentiation strategy offers products that are unique or different the competition
what is a cost leadership strategy?
a cost leadership strategy seeks to operate with lower costs than competitors
what is a focused differentiation strategy?
A focused differentiation strategy offers a unique product to a special market segment
what is a focused cost leadership strategy?
A focused cost leadership strategy seeks the lowest cost of operation within a special market segment
what is logical incrementalism?
James Bryant Quinn calls this process of logical incrementalism whereby incremental changes in strategy occur as managers learn from experience. This approach has much in common with Henry Mintzberg's and John Carter's description of managerial behavior in chapter 1.
What are emergent strategies?
Mintzberg identifies emergent strategies as strategies that develop progressively over time as streams of decisions made by managers as they learn from and respond situations
what are failures of substance?
Failures of substance are caught, and strategic planning pitfalls that reflect an adequate attention to the major strategic planning elements: analysis of mission, values and objections, organizational strengths and weaknesses, and environmental opportunities and threats.
Where failures of process?
Also a common strategic planning pitfall failures of process reflect poor handling of the strategic planning process itself a good example is lack of participation error
what is corporate governance?
Corporate governance is the system of control and performance monitoring of top management.
What is strategic leadership?
Strategic leadership enthuses people to continuously change, refined, and improve strategies in their implementation
Porter's notes on the chief strategists
a strategic leader has to be the guardian of trade-offs, to make sure that the organization's resources are allocated in ways consistent with the strategy. They also need to create a sense of urgency not allowing the organization and its members to gross loan complacent, they need to make sure that everyone understands strategy and that leader must be a teacher. Strategic leader must also be a great communicator, keeping everyone focused on the organization's strategic priorities
what is entrepreneurship?
Entrepreneurship is a dynamic, risk-taking, creative, and growth oriented behavior.
What is an entrepreneur?
An entrepreneur pursues opportunities in risk situations. In the business context and entrepreneur starts debentures that bring to life new product or service ideas. Typical characteristics of entrepreneurs include: internal locus of control, high energy level, I need for achievement, tolerance for ambiguity, self-confidence, action oriented
what is a small business?
A small business has fewer than 500 employees, is independently owned and operated, does not dominate its industry.
what is a business plan?
A business plan is important foundation for success is a written document that describes the nature of the business unit strategy, as well as exactly how one entrepreneur intends to start and operate it
what is intrapreneur ship?
Intrapreneur ship is entrepreneurial behavior displayed by people or subunits within large organizations