Midterm Review CH: 1,2,3,4,14

Question 0

What is strategic management?

Answer 0

Formulating, implementing, and evaluating a company’s strategies.

Question 1

What is strategy?

Answer 1

The company’s game plan.

Question 2

What does the strategic management cycle look like?

Answer 2

Create mission and vision
Internal and external assessment
Create long-term objectives
Generate, evaluate, select strategies
Implementation
Performance and evaluation

Question 3

Strategic management achieves a firm’s success through ___________.

Answer 3

Integration

Question 4

What does strategic management integrate?

Answer 4

Management
Information management
Human resources
Research and development
Marketing
Finance/accounting
Production (operations)

Question 5

What are the aspects of a business strategy diamond?

Answer 5

Arenas
Vehicles
Differentiators
Economic logic
Staging (and pacing)

Question 6

Adapting to change requires __________ focus.

Answer 6

Long-term

Question 7

Strategic management involves gaining and maintaining ________________.

Answer 7

Competitive advantage

Question 8

Considering external factors, the difference between intended and realized strategy depends on what?

Answer 8

Implementation levers and leadership.

Question 9

What are implementation levers?

Answer 9

Structure
Systems
People

Question 10

What is leadership?

Answer 10

Resource allocation and support

Question 11

What are the specific targets for a company that have measurable outcomes?

Answer 11

Strategic goals/objectives

Question 12

Describe what a company’s vision and mission are.

Answer 12

The fundamental purpose; values; a view of the future.

Question 13

What are porters five forces?

Answer 13

Threat of substitutes 
Threat of new entrants
Supplier (bargaining) power
Buyer power
Degree of rivalry
\+ 1 complementors

Question 14

Explain the degree of rivalry force.

Answer 14

How intense is the competition?

Will they fight or exit the industry?

Question 15

Describe threat of new entrants.

Answer 15

How easy is it to enter the industry?

Cost, resources, government policies…

Question 16

Explain threat of substitutes.

Answer 16

At what price will customers switch?

How easy is it to develop substitutes?

Question 17

Explain bargaining (supplier) power.

Answer 17

How many suppliers are there?
How much power do they have?
What are the customer switching costs?

Question 18

Define the bargaining power of customers.

Answer 18

How much do customers know?
How much power do they have?
Are products undifferentiated?

Question 19

Define the complementors force.

Answer 19

Products in one industry increase sales in another.

Can working with buyers/suppliers add value?

Question 20

Explain the stages of the industry life cycle.

Answer 20

Embryonic
Growing
Mature
In decline

Question 21

What is a KSF and a value curve?

Answer 21

KSF - key success factors

Which are then plotted on a value curve based on the factors.

Question 22

Describe the steps to doing an external factors evaluation (EFE) matrix.

Answer 22

1. Summarize external factors (opportunities, threats)
2. Rank importance of issue
3. Evaluate the company’s response to the issues
4. Calculate the average score of their responses to the issues

Question 23

Give some examples of board duties.

Answer 23

Set strategy goals/direction.
Hire/fire CEO.
Supervise top management.
Review/approve use of resources.
Care for shareholder interests.

Question 24

What are the types of directors?

Answer 24

Inside - management Outside - non-management Affiliated

Question 25

When managers identify with company and will do what is right for company, what is this called?

Answer 25

Stewardship theory

Question 26

What are the factors of PESTEL analysis?

Answer 26

``` Political Economical Socio-cultural Environmental Legal ```

Question 27

What environment does PESTEL analyze?

Answer 27

Macro environment

Question 28

Explain the resource-based view of competition.

Answer 28

Resources plus capabilities and strategic leadership create competitive advantage/disadvantage.

Question 29

What are resources and capabilities?

Answer 29

Physical (plant, equip, tech, materials) Human (people, collective experience, skills, knowledge) Organizational (process, systems, culture, structure)

Question 30

What does the VRINE framework summarize?

Answer 30

``` For testing competitive resources. Valuable Rare Inimitable Non-substitutabile Exploitable ```

Question 31

What is a value chain?

Answer 31

A linked set of value-creating activities.

Question 32

Explain how using value chains gain competitive advantage.

Answer 32

Identical -> differentiated processes Different processes - long-lasting advantage Better processes - short-term advantage

Question 33

The systematic review of resources and capabilities of a business is considered what?

Answer 33

Internal assessment

Question 34

Describe the steps of internal assessment.

Answer 34

1) VRINE analysis 2) value-chain analysis 3) internal factors evaluation