Chapter 6

Question 1

What is a plan?

Answer 1

A set of activities intended to achieve goals, whether for an entire organization, department, or an individual.

Question 2

What is a mission?

Answer 2

A definition of an organization’s fundamental purpose and its basic philosophy.

Question 3

What is a mission statement?

Answer 3

A formal written declaration of the organization’s mission: often includes the firm’s philosophy, its primary products and markets etc.

Question 4

What is a goal?

Answer 4

The final result that a firm wishes to achieve.

Question 5

strategic goals

Answer 5

goals set by higher managers that deal with general topics as the firm’s growth, new markets, or new goods

Question 6

tactical goals

Answer 6

intermediate goals of the firm, designed to stimulate actions necessary for achieving the strategic goals.

Question 7

operational goals

Answer 7

short term goals that are addressed to first line managers and usually apply to specific work operations

Question 8

strategic plans

Answer 8

plans that are intended to achieve strategic goals

Question 9

tactical plans

Answer 9

plans that are designed to achieve tactical goals

Question 10

operational plans

Answer 10

plans that are intended to achieve operational goals

Question 11

What is strategic management?

Answer 11

The Entire process an organization undertakes to develop and implement its strategic plan

Question 12

What is a strategy?

Answer 12

a course of action for implementing strategic plans and achieving strategic goals.

Question 13

What is distinctive competence?

Answer 13

What a firm does well relative to its competitors.

Question 14

What is a SWOT analysis?

Answer 14

evaluation of organizations strengths, weaknesses, opportunities, and threats.

Question 15

What is a corporate strategy?

Answer 15

The scope and resource deployment components of strategy for the enterprise as a whole.

Question 16

What is a business-level strategy?

Answer 16

the area of responsibility usually assigned to the divisional level managers.

Question 17

What is diversification?

Answer 17

strategy of acquiring or developing other businesses, which must ultimately be justified by its ability to build stockholder wealth.

Question 18

Related diversification

Answer 18

a firm’s acquisition of a business that has some connection with the company’s existing businesses.

Question 19

Unrelated diversification

Answer 19

The action of diversifying into any business that is potentially profitable for the organization.

Question 20

What are conglomerates?

Answer 20

Firms that pursue unrelated diversification strategies.

Question 21

What is divestment

Answer 21

A strategy of selling off businesses that the company no longer wishes to maintain

Question 22

What is a strategic business unit?

Answer 22

separate division within a company that has its own mission, goals, strategy, and competitors.

Question 23

What is a portfolio analysis?

Answer 23

A technique allowing for managers to visualize their businesses as a set or portfolio using certain common criteria

Question 24

What are stars in the Boston Consulting Group (BCG)?

Answer 24

businesses that have high market shares and operate in industries experiencing major growth

Question 25

What are question marks in BCG

Answer 25

businesses that are viewed positively in growing markets but have a low market share

Question 26

What are cash cows in BCG

Answer 26

businesses that tend to generate excess cash over what is needed for their continued growth. High Market share, slow growing market

Question 27

What are dogs in BCG

Answer 27

businesses that have only minimal profits or even losses due to low market share in slow growing markets.

Question 28

What is cost leadership?

Answer 28

Business-level strategy aimed at achieving the overall lowest cost structure in an industry.

Question 29

Differentiation

Answer 29

Business strategy in which the business offers a unique good or service

Question 30

Focus

Answer 30

Business strategy where the business concentrates on one part or segment of the market

Question 31

What is the product life cycle?

Answer 31

cycle of birth, growth, maturity, and decline of a product

Question 32

birth

Answer 32

initial stage when the product is introduced

Question 33

growth

Answer 33

stage characterized by dramatic increases in market share.

Question 34

maturity

Answer 34

stage when the products market share slows or has no growth

Question 35

decline

Answer 35

stage marked by decreases in market share

Question 36

What are contingency plans?

Answer 36

alternate courses of action to be undertaken if certain organizational or environmental conditions change.