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POM > Chapter 4: Strategic and Tactical Planning > Flashcards

Chapter 4: Strategic and Tactical Planning Flashcards

0
Q

Organisation mission is the organisation’s

A

Basic purpose

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1
Q

What is strategic planning?

A

A process done by managers
Determine organisation mission
Set of means to achieve this basic purpose

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2
Q

A strategy is a

A

Broad and general plan developed to reach

Strategic and long term goals

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3
Q

Companies that don’t just have a single business are into

A

Diversification

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4
Q

Diversification refers to

A

Number of different goods/services a company produces

And the number of different markets it serves

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5
Q

Large scale diversified organisations are called

A

Conglomerates

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6
Q

Diversified organisations have different

A

Levels at which strategic planning is done

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7
Q

The levels at which strategic planning is done is

A

Corporate level

Business level

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8
Q

Corporate level develops a

A

Strategy that guides the activities of organisations that consist of more than one line of business

It focuses on:
Kinds of business the firm wants to engage in
Ways to acquire or divest business
Allocation of resources among various business
Ways to manage these business

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9
Q

Business level strategy is done

A

After corporate strategy

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10
Q

Business level strategy

A

Guides the operations of a single business that produces a particular good/service to a specific industry or market segment

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11
Q

The focus is on which level?

A

Business level

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12
Q

What are the steps of strategic planning?

A
  1. Develop mission and goals
  2. Diagnose threats and opportunities
  3. Assess strengths and weaknesses
  4. Generate alternative strategies
  5. Develop strategic plan
  6. Develop tactical plan
  7. Correct and assess results
  8. Repeat planning process
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13
Q

Organisational mission and goals are developed by asking

A

Who are we
What business are we in
What do we want to become

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14
Q

What are the big groups of threats?

A

General environment

Porter’s 5 major competitive forces

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15
Q

What are the dimensions in Porter’s 5 major competitive forces?

A 
Rivalry among existing firms
Bargaining power of customer
Bargaining power of suppliers 
Threats of new entrants
Threat of substitute product or service
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16
Q

The greater the competitive forces,

A

The greater the threat

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17
Q

We measure the competitive forces by

A

Intensity

High/low

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18
Q

If there is too great threat, organisation

A

Might not reach strategic goals

Reduced profit potential

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19
Q

When the competitive forces are weaker,

A

There are greater opportunities for the company to operate successfully

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20
Q

Rivalry among existing firms is the extent to which

A

Competitors continually compete for business

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21
Q

Factors for high rivalry among existing firms include

A 
Large number of competitors
High rate of industry growth
Price competition
Advertising battles
New product introduction
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22
Q

The bargaining power of customers is the extent to which

A 
Customers are able to
Force down prices 
Bargain for higher quality 
More service at the same price
Play competitors against each other
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23
Q

Customers have high bargaining power when

A

Small number of customers purchase relatively large volumes from seller
Customers purchase standard/undifferentiated goods or services
Customers can easily switch from one seller to another

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24
Q

The bargaining power of suppliers is the extent to which

A

Suppliers can exert power of businesses in an industry by
Threatening to raise price
Reduce the quality of goods/services

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25
Q

Suppliers have high bargaining power when

A

Small number of suppliers sell to a large number of buyers
Suppliers goods are differentiated
Suppliers do not have to worry about substitute goods and service

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26
Q

Threats of new entrants is the extent to which

A

New competitors can enter the same product or service markets

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27
Q

Threat of new entrants is affected by

A

Barriers to entry

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28
Q

Threat of substitute product or service is the extent to which

A

Businesses in other industries offer substitute products

29
Q

Assessing strengths and weaknesses helps managers identify organisation

A 
Distinctive capabilities and competencies
Relative competitive position 
Human resource skills 
Technological capabilities
Financial resources 
Managerial depth
30
Q

The two strategies are

A

Growth strategies

Porter’s competitive strategies

31
Q

Growth strategies explains the

A

Direction of strategy

WHERE

32
Q

Porters competitive strategies explains

A

How companies choose to compete

33
Q

The growth strategies are

A

Market penetration
Market development
Product development
(Differentiation)

34
Q

Market penetration involves

A

Seeking growth in current markets

Using current goods/services

35
Q

A firm increases market share in market penetration by

A

Increasing rate of purchase of product
Attracting competitors customers
Buying a competition
Converting nonusers to users

36
Q

Market development involves

A

Seeking new markets with current products

37
Q

Market development is done by

A

Finding new geographic markets
Finding new target markets
Finding new uses

38
Q

Product development strategy involves

A

developing new or improved goods or services

For current markets

39
Q

Product development is done by

A

Improving features
Improving quality
Enhancing aesthetic appeal
Adding models

40
Q

Porters competitive strategies involve two dimensions. They are

A

Strategic target

Strategic advantage

41
Q

Strategic target spans from

A

Industry wide

Industry niche

42
Q

Strategic target indicates how

A

Widely the good or service is intended to compete

43
Q

Niche is a

A

Narrowly defined market segment

Competitors overlook and have difficulty serving

44
Q

Strategic advantage spans from

A

Low cost

Uniqueness

45
Q

Strategic advantage indicates the

A

basis on which good or services are intended to compete

46
Q

Industry wide and unique. The strategy is

A

Differentiation

47
Q

Differentiation involves

A

Developing goods/services that are viewed as unique in the industry

48
Q

The ways products can be different are

A 
Unique design
Unique brand image
Technology
Customer service
Features
High quality 
Product warranty
49
Q

With successful differentiation, firms can

A

Change premium prices

Leading to above average profits

50
Q

Industry wide and low cost. The strategy is

A

Cost leadership

51
Q

Cost leadership involves

A

Emphasising internal organisational efficiency

Overall prices of providing goods/services are lower than those of competitors

52
Q

When strategic target is niche, strategy is

A

Focus

53
Q

Focus strategy involves

A

Competing in a specific industry niche
Offering unique product
Or low cost product

54
Q

A strategic plan is developed after

A

Strategy is selected

55
Q

A strategic plan should

A

Specify action to be taken in order to achieve goals

Addresses how:
Technological 
Marketing 
Financial
HR will be obtained

Research and development will be conducted

Organisation and management capabilities utilized

56
Q

Tactical plans helps

A

Implement strategic plan

57
Q

Strategic and tactical planning must be accompanied by

A

Controls

58
Q

Controls ensure

A

Implementation of plans

Evaluation of results

59
Q

If plans do not produce desired results, managers need to

A

Change mission
Goals
Strategies
Or plans

60
Q

Planning needs to be repeated because

A

Factors and forces that affect organisation are constantly changing
Need to adapt

61
Q

Two mistakes in planning are

A

Extinction by instinct

Paralysis by analysis

62
Q

Extinction by instinct occurs when

A

Managers are so concerned with solving immediate problems
Making quick decisions
Do not strategically plan long-term

63
Q

Paralysis by analysis occurs when

A

Managers get so bogged down with detailed planning

Neglect making important decisions

64
Q

Common barriers to effective planning are

A

Inability to plan
Improper planning process
Improper information

65
Q

Inability to plan arises from

A

Managers lacking
Background
Knowledge
Conceptual skill

66
Q

Improper planning process arises from

A

Inexperienced managers not knowing the process

67
Q

Improper information are

A

Out of date
Poor quality
Insufficient

68
Q

Effective planning is ensured through

A

Getting as much information as possible
Multiple sources of information
Inclusion of right people

69
Q

Getting information should be

A

Within limits of time and money

70
Q

There should be multiple sources of information because

A

Manger is not an expert in every area

POM (16 decks)

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