MIDTERM Flashcards
(23 cards)
Define Strategy:
The set of ____-_________ actions a _____ takes to gain and sustain superior performance relative to its ______________.
The set of GOAL-ORIENTED actions a FIRM takes to gain and sustain superior performance relative to its COMPETITORS.
Purpose of Strategic Mgmt:
Enables you to view an ____________ in its ________. It also enables you to think like a ________ ________ to help position your organization for superior performance.
Enables you to view an ORGANIZATION in its ENTIRETY. It also enables you to think like a GENERAL MANAGER to help position your organization for superior performance.
3 Levels of Strategy…
AFI -
(Analysis -)
…Vision, Mission, Values
…External Analysis
… Internal Analysis
(Formulation -)
… Corporate Strategy
… Business Strategy
… Function Strategy
(Implementation -)
… Structure, Culture, Control
… Corporate Governance & Business Ethics
Define competitive advantage:
_________ performance relative to other competitors in the same ________ or the ________ average.
SUPERIOR performance relative to other competitors in the same INDUSTRY or the INDUSTRY average.
Relationship among mission, vision, and strategy:
Building on the _______, organizations establish a _______…
Firms need to back up their _______ and _______ with _______ commitments…
How? =
What? =
Why? =
Vision - What
Mission - Why
Strategy - How
Building on the VISION, organizations establish a MISSION…
Firms need to back up their VISIONS and MISSIONS with STRATEGIC commitments…
Value Chain - Primary Activities
- Inbound logistics
- Manufacturing
- Outbound logistics
- Marketing and Sales
- Sales Service
Value Chain - Support Activities
- R and D
- Information Systems
- HR
- Accounting and Finance
- Policies, Processes, and Procedures
Strategy Components:
Mission
Vision
Values
Macro PEST elements:
P - Political
E - Economical
S - Sociocultural
T - Technological
Porter’s Five Forces:
- Threat of Entry (top)
- Power of Suppliers (left)
- Power of Buyers (right)
- Threat of Substitutes (bottom)
- Rivalry Among Competitors (center)
Life Cycle Stages:
- Emerging
- Growing/growth
- Maturity
- Decline
Used to identify trends/stage trend is in.
Strategic Group Analysis:
Group A - ___ Cost
Group B - _____________
Definition - a framework that explains ____________ in firm performance within the same industry.
X-axis: _______
Y-axis: _____ _________
(Low bottom/left… high top/right)
Group A - LOW Cost
Group B - DIFFERENTIATED
Definition - a framework that explains DIFFERENCES in firm performance within the same industry.
X-axis: ROUTES
Y-axis: COST STRUCTURE
(Low bottom/left… high top/right)
3 Standards to Measure:
- Accounting Profitability
- Shareholder Value
- Economic Value
What is RBV?
… a model that sees certain types of ___________ as key to superior ____ performance.
Resource-Based View
… a model that sees certain types of RESOURCES as key to superior FIRM performance.
What is RBV good for?
Analyzing internal strengths and weaknesses.
2 Assumptions for RBV?
- Resource heterogeneity
2. Resource Immobility
VRIO framework… what’s the acronym?
V - Valuable
R - Rare
I - Imitation Costly
O - Organized to Capture Value
What is the VRIO decision tree?
A firm must answer yes to all four of the VRIO tree Qs for its resource in question to be a core competency.
4 Approaches to better protect your companies competitive advantage:
- Path dependence 2. Causal ambiguity 3. Intellectual Property (IP) protection 4. Social complexity
Total Economic Value:
Value creation because of superior product ______________.
Value creation because of superior product DIFFERENTIATION.
Can charge more
Producer’s Surplus:
Another term for ________.
Another term for PROFIT.
Price charged - cost to produce (P-C)
Consumer Surplus:
Difference between value a consumer attaches to a good or service and what he or she paid for it (V-P)
Triple Bottom Line:
Combination of Economic, Social, and Ecological (profit, people, planet) concerns — that can lead to a sustainable strategy.
