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Chapter 2 Terms
Terms in this set (34)
Strategic management process
Method put in place by strategic leaders to conceive and implement a strategy, which can lay the foundation for a sustainable competitive advantage.
Executives' use of power and influence to direct the activities of others when pursuing an organization's goals.
A statement about what an organization ultimately wants to accomplish; it captures the company's aspiration.
-Visionary companies tend to outperform their competitors
Description of what an organization actually does - the products and services it plans to provide, and the markets in which it will compete.
-achieve mission by...
Actions that are costly, long-term - oriented, and difficult to reverse.
Defines a business in terms of a good or service provided.
-can constrain changes
Defines a business in terms of providing solutions to customer needs.
-allow companies to adapt to changing environments
Ethical standards and norms that govern the behavior of individuals within a firm or organization.
The behaviors and styles of executives that influence others to achieve the organization's vision and mission.
A conceptual framework that views organizational outcomes - strategic choices and performance levels - as reflections of the values of the members of the top management team, who interpret situations through the lens of their unique perspectives.
Level-5 leadership pyramid
A conceptual framework of leadership progression with five distinct, sequential levels.
Level 1: Highly capable individual
Makes productive contributions through motivation, talent, knowledge, and skills.
Level 2: Contributing team member
Uses high level of individual capability to work effectively with others in order to achieve team objectives.
Level 3: Competent manager
Is efficient and effective in organizing resources to accomplish stated goals and objectives. Does things right.
Level 4: Effective leader
Presents compelling vision and mission to guide groups toward superior performance. Does the right things.
Level 5: Executive
Builds enduring greatness through a combination of willpower and humility.
the choice of strategy in terms of where and how to compete
where to compete (industry, markets, and geography).
how to compete (cost leadership, differentiation, or value innovation)
-occurs within strategic business units, or SBUs
how to implement business strategy
Strategic business units
A standalone division of a larger conglomerate, with its own profit-and-loss responsibility.
Strategic Management Approaches (3)
1. Strategic planning
2. Scenario planning
3. Strategy as planned emergence
Top-down strategic planning
A rational, top-down process through which management can program future success; typically concentrates strategic intelligence and decision-making responsibilities in the office of the CEO.
Strategy-planning activity in which managers envision different what-if scenarios to anticipate plausible futures.
Dominant strategic planning
The strategic option that top managers decide most closely matches the current reality and which is then executed.
Illusion of control
The hard numbers in a strategic plan can convey a false sense of security.
The outcome of a rational and structured top-down strategic plan.
Combination of intended and emergent strategy.
Any unplanned strategic initiative undertaken by mid-level employees of their own volition
Any activity a firm pursues to explore and develop new products and processes, new markets, or new ventures.
Strategy process in which organizational structure and systems allow bottom-up strategic initiatives to emerge and be evaluated and coordinated by top management.
Strategic initiatives undertaken by lower- level employees on their own volition and often in response to unexpected situations.
Any random events, pleasant surprises,
and accidental happenstances that can have a profound impact on a firm's strategic initiatives.
resource-allocation process (RAP)
The way a firm allocates its resources based
on a predetermined policies, which can be critical in shaping its realized strategy.