Principles of Management Flashcards

Question

What are 4 strategic ways of growth?

Answer 1

- Concentration --> producing more/entering new markets - Vertical integration --> either backwards (acquire/merge with supplier) or forward (acquire/merge with retailer) - Horizontal integration --> acquire/merge with a competitor - Diversification --> launching new/different products

Answer 2

1. Retrenchment strategy = short run strategy for minor performance problems that involve reducing size, cutting costs & focusing on core business activities --> helps to stabilize operations, revitalize resources and prepares to compete again 2. Turnaround strategy = for more serious problems, designed to rescue a failing business

Answer 3

1. Cost leadership strategy --> being the cheapest in the market (mass products) 2. Differentiation strategy --> competing on quality, focus on unique characteristics (brand/luxury items) 3. Focus strategy --> focusing on a very narrow segment (e.g. only on young people in Vienna) 4. Stuck in the middle --> strategy without any focus (soon to be out of market bc others will be better)

Answer 4

- Customer service - Skilled & loyal employees - Innovation - Quality - Marketing - Big data

Answer 5

the process of making decisions about how specialized jobs should be, the rules to guide employee's behavior, and the level at which decisions will be made

Answer 6

when first introduced, specialization almost always generated higher productivity, but at some point, boredom, stress, etc. exceed the economic advantages (when tasks get too repetitive)

Answer 7

- Functional --> grouped by function, such as HR, Marketing, etc. --> does not show what firm actually does --> good coordination within functional area, but poor communication across functional areas (limited view of goals) - Product --> like Procter & Gamble, J&J --> managers become experts in industry & closer to customers, but creates duplication of functions - Customer --> makes sense when characteristics of customers are very different (e.g. travel agency) --> customer needs can be met by specialists, but creates duplication of function - Geographic --> makes sense if regions of divisions are very different --> more effective in handling regional issues, but duplication of functions & isolation from other areas - Process --> when different products need to go through same sequence of processes (e.g. in manufacturing company, where ALL products need to be painted, commissioned, etc) --> most efficient workflow, but can only be used with certain product types

Answer 8

reporting line that clarifies who reports to whom

Answer 9

Line authority --> manager directs work to an employee according to chain of command Staff authority --> functions to support, assist, advice managers

Answer 10

Authority = you have the legitimate right to do something based on your position Power = an individual's ability to influence decisions (not necessarily based on position)

Answer 11

Coercive power = power based on fear (having the right to punish someone) Reward power = power based on the ability to reward (opposite of coercive) Legitimate power = power that comes from your position (being the boss) Expert power = power based on expertise/knowledge (e.g. if you are the only IT expert) Referent power = power based on your personality (e.g. excellent interpersonal skills)

Answer 12

= number of employees a manager supervises --> decision on appropriate size depends on multiple factors, but generally it can be said that the more training & experience employees have, the less direct supervision they need & the larger the span of control can be

Answer 13

Mechanistic (e.g. Army) - hierarchical relationships - many rules - formalized communication channels - centralized decision authority - makes sense for large companies in a stable environment Organic (e.g. start-ups) - adaptable duties - less rules, more freedom - informal communication - decentralized decision authority - flat relationships - makes sense for small companies in a dynamic environment

Answer 14

While recruitment is the process of creating a pool of applicants, selecting means picking the right candidate among this pool

Answer 15

positive discrimination, where organization takes proactive steps to also include disadvantaged/underrepresented groups in the recruiting process

Answer 16

1. If the applicant who was hired proved to be successful on the job (if that is not the case, an "accept error" has occurred) 2. If the applicant who was not hired would not have been able to do the job (if that is not the case, a "reject error" has occurred) --> The major intent of any selection activity is to reduce the probability of making reject errors and accept errors while increasing the probability of making correct decisions

Answer 17

Validity = when instruments in an experiment measure what you want them to measure Reliability = when the outcomes are consistent if you would repeat the experiment e.g. final oral exam could be a valid measure to proof knowledge of BCi studies. A pass would be reliable if you would be able to pass multiple times

Answer 18

on-the-job = training that you do while you are doing your regular job (added on) off-the-job = training where you leave your workday/building and go somewhere else because the training is so important