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AS A JOSENIAN IE ^^ > STIE 1 C6 > Flashcards

STIE 1 C6 Flashcards

1
Q

It summarizes the basic input information needed to formulate strategies

A

Stage 1: Input Stage

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2
Q

Input Stage is composed of

A

EFE (External Factor Evaluation) Matrix

IFE (Internal Factor Evaluation) Matrix

CPM (Competitive Profile Matrix)

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3
Q

Focuses upon generating feasible alternative strategies by aligning key external and internal factors

A

Stage 2: Matching Stage

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4
Q

What consists Matching Stage?

A

SWOT Matrix
SPACE Matrix
BCG Matrix
IE Matrix
Grand Strategy Matrix

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5
Q

What do SWOT, SPACE, BCG, and IE mean?

A

Strengths-Weaknesses-Opportunities-Threats

Strategic Position and Action Evaluation

Boston Consulting Group

Internal-External

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6
Q

What does QSPM mean?

A

Quantitative Strategic Planning Matrix

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7
Q

Involves a single technique, the Quantitative Strategic Planning Matrix (QSPM)

A

Decision Stage

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8
Q

What occurs in QSPM?

A

Uses input information from Stage 1 to objectively evaluate feasible alternative strategies identified in Stage 2

Reveals the relative attractiveness of alternative strategies and thus provides objective basis for selecting specific strategies.

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9
Q

What is the SWOT Matrix?

A

An important matching tool that helps managers develop four types of strategies: SO (strengths-opportunities) Strategies, WO (weaknesses-opportunities) Strategies, ST (strengths-threats) Strategies, and WT (weaknesses-threats) Strategies.

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10
Q

use a firm’s internal strengths to take advantage of external opportunities.

A

SO Strategies

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11
Q

WO Strategies

A

aim at improving internal weaknesses by taking advantage of external opportunities

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12
Q

ST Strategies

A

use a firm’s strengths to avoid or reduce the impact of external threats.

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13
Q

defensive tactics directed at reducing internal weakness and avoiding external threats

A

WT Strategies

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14
Q

What do the SPACE Matrix quadrants indicate?

A

whether aggressive, conservative, defensive, or competitive strategies are most appropriate for a
given organization.

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15
Q

What are the four conservative strategies?

(MMPR - Mark Moore Paid Rent)

A
  • Market penetration
  • Market development
  • Product development
  • Related diversification
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16
Q

What are the five aggressive strategies?

(BMMPD - Bless My Mama, Papa, Dog)

A
  • Backward, forward, horizontal integration
  • Market penetration
  • Market development
  • Product development
  • Diversification (related or unrelated)
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17
Q

What are the defensive strategies?

(RDL - Right Dumbbell Lift)

A
  • Retrenchment
  • Divestiture
  • Liquidation
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18
Q

An organization is in an excellent position to use its internal strengths to take advantage of external opportunities, overcome internal weaknesses, and avoid external threats if a firm’s directional vector is located in the upper-right quadrant of SPACE Matrix.

A

Aggressive Quadrant

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19
Q

Conservative Quadrant

A

The directional vector may appear in the upper-left quadrant of the SPACE Matrix, which implies staying close to the firm’s basic competencies and not taking excessive risks.

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20
Q

The directional vector may be located in the lower-left of the SPACE Matrix, which suggests that the firm should focus on rectifying internal weaknesses and avoiding external threats.

A

Defensive Quadrant

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21
Q

The directional vector may be located in the lower-right of the SPACE Matrix, indicating competitive strategies.

A

Competitive Quadrant

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22
Q

What is a business portfolio?

A

Autonomous divisions (or profit centers) of an organization make up

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23
Q

These two matrices are designed specifically to enhance a multidivisional firm’s efforts to formulate strategies.

A

BCG and IE Matrices

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24
Q

Boston Consulting Group Matrix

A

Graphically portrays differences among divisions in terms of relative market share position and industry growth rate.
It allows a multidivisional organization to manage its portfolio of businesses by examining the relative market share position and the industry growth rate of each division relative to all other divisions in the organization.

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25
Q

The ratio of a division’s own market share (or revenues) in a particular industry to the market share (or revenues) held by the largest rival firm in that industry.

A

Relative market share position

26
Q

Divisions in Quadrant I that have a low relative market share position, yet they compete in a high-growth industry.

A

Question Marks

27
Q

Stars

A

Quadrant II businesses that represent the organization’s best long-run opportunities for growth and profitability

28
Q

Divisions positioned in Quadrant III that have a high relative market share position but compete in a low-growth industry.

A

Cash Cows

29
Q

Dogs

A

Quadrant IV divisions of the organization that have a low relative market share position and compete in a slow- or no-market-growth industry

30
Q

This positions an organization’s various divisions in a nine-cell display.

A

IE Matrix

31
Q

The prescription for divisions that fall into cells I, II, or IV

A

Grow and Build

32
Q

Divisions that fall into cells III, V, or VII can be managed best with this.

A

Hold and Maintain

33
Q

A common prescription for divisions that fall into cells VI, VIII, or IX

A

harvest or divest

34
Q

Grand Strategy Matrix

A

A popular tool for formulating alternative strategies that is based on two evaluative dimensions: competitive position and market (industry) growth.

35
Q

What is Culture?

A

It includes the set of shared values, beliefs, attitudes, customs, norms, personalities, heroes, and heroines that describe a firm.

36
Q

One of a group of persons entrusted with the overall direction of a corporate enterprise

A

Director

37
Q

A group of individuals who are elected by the ownership of a corporation to have oversight and guidance over management and who look out for shareholders’ interests.

A

Board of Directors

38
Q

What is Governance?

A

The act of oversight and direction

39
Q

limitations of QSPM

A

requires intuitive judgments and educated assumptions only as good as inputs

Only as good as the prerequisite
information and matching analyses upon which it is based

40
Q

t or f: successful strategies depend on the degree of support from a firm’s culture

A

TRUE

41
Q

What approach is the best way to avoid an organizational crisis?

A

The Strategy Analysis and Choice Process

42
Q

The process steps of developing a SPACE Matrix

(SACPAD - So All Cocks and Pussies Are Delicious?)

or

Select-Assign-Compute-Plot-Add-Draw

A
  1. Select a set of variables to define financial position (FP), competitive position (CP), stability position (SP), and industry position (IP).
  2. Assign a numerical value ranging from+ 1 (worst) to+ 7 (best) to each of the variables that make up the FP and IP dimensions. Assign a numerical value ranging from -1 (best) to - 7 (worst) to each of the variables that make up the SP and CP dimensions. On the FP and CP axes, make comparisons to competitors. On the IP and SP axes, make comparisons to other industries. On the SP axis, know that a - 7 denotes highly unstable industry conditions, whereas -1 denotes highly stable.
  3. Compute an average score for FP, CP, IP, and SP by summing the values given to the variables of each dimension and then dividing by the number of variables included in the respective dimension.
  4. Plot the average scores for FP, IP, SP, and CP on the appropriate axis in the SPACE Matrix.
  5. Add the two scores on the x-axis and plot the resultant point on X. Add the two scores on the y-axis and plot the resultant point on Y. Plot the intersection of the new (x, y) coordinate.
  6. Draw a directional vector from the origin of the SPACE Matrix (0,0) through the new (x, y) coordinate. That vector, being located in a particular quadrant, reveals particular strategies the organization should consider.
43
Q

The BCG Matrix graphically portrays differences among divisions based on two dimensions:

A

(1) relative market share position on the x-axis and (2) industry growth rate on the y-axis.

44
Q

in sales, measured in percentage terms-that is, the average annual increase in revenue for all firms in an industry.

A

industry growth rate (IGR)

45
Q

Grand Strategy Matrix
is based on two evaluative dimensions:

A

(1) competitive position on the x-axis and (2) market (industry) growth on the y-axis. Any industry whose annual growth in sales exceeds 5 percent could be considered to have rapid growth

46
Q

The IE Matrix is based on two key dimensions:

A

(1) the IFE total weighted scores on the x-axis and (2) the EFE total weighted scores on the y-axis

47
Q

What is Stability Position (SP)?

A

refers to the volatility of profits and revenues for firms in a given industry.

is based on the expected impact of changes in core external factors.

One of the four dimensions/axes of the SPACE Matrix that determines how stable/unstable a firm’s industry is, considering such factors as technological changes, rate of inflation, demand of variability, price range of competing products, barriers to entry into market, competitive pressure, ease of exit from market, price elasticity of demand and risk involved in business.

48
Q

Give the Principles of Good Governance

A
  1. No more than two directors are current or former company executives
  2. The audit, compensation, and nominating committees are made up solely of outside directors
  3. Each director owns a large equity stake in the company, excluding stock options
  4. Each director attends at least 75 percent of all meetings
  5. The board meets regularly without management present and evaluates its own performance annually
  6. The CEO is not also the chairperson of the board
  7. Stock options are considered a corporate expense
  8. There are no interlocking directorships (where a director or CEO sits on another director’s board)
49
Q

Five Tactics to Aid Strategists

ESGFP - Earl Smith Gets Four Pizzas

A

Equifinality

Satisfying

Generalization

Focus on Higher-Order Issues

Provide Political Access on Important Issues

50
Q

consumes valuable time, subverts organizational objectives, diverts human energy, and results in the
loss of some valuable employees

A

Political Maneuvering

51
Q

True or False: Political biases and personal preferences get unduly embedded in strategy choice
decisions

A

TRUE

52
Q

Positive Features of the QSPM

A

❖Sets of strategies can be examined
sequentially or simultaneously

❖Requires strategists to integrate pertinent external and internal factors into the decision process

❖Can be adapted for use by small and large for-profit and nonprofit organizations

53
Q

Steps of QSPM?

MAEDCC - Make Ants Eat Delicious Chocolate Cake

or

Make-Assign-Examine-Determine-Compute-Compute Total

A
  1. Make a list of the firm’s key external
    opportunities/threats and internal
    strengths/weaknesses in the left column of the
    QSPM
  2. Assign weights to each key external and internal factor
  3. Examine the Stage 2 (matching) matrices, and identify alternative strategies that the organization should consider implementing
  4. Determine the Attractiveness Scores (AS)
  5. Compute the Total Attractiveness Scores
  6. Compute the Sum Total Attractiveness Score
54
Q

Three major regions of IE Matrix

A

 Grow and build
 Hold and maintain
 Harvest or divest

55
Q

The major benefit of the BCG Matrix

A

t it draws attention to the cash flow,
investment characteristics, and needs of
an organization’s various division

56
Q

T or F: Proposed strategies should be listed in writing.

A

TRUE

57
Q

When all feasible strategies identified by participants are given and understood, the strategies should be ranked in order of ____________

A

Attractiveness

58
Q

T or F: Identifying and evaluating alternative strategies should involve many of the managers and employees who earlier assembled the organizational vision and
mission statements, performed the
external audit, and conducted the internal audit.

A

TRUE

59
Q

What are the three stages and their matrices?

A

STAGE 1: Input Stage
- EFE, IFE, CPM

STAGE 2: Matching Stage
- SWOT, SPACE, BGC, IE, Grand Strategy

STAGE 3: Decision Stage
- QSPM

60
Q

What are the competitive strategies?

A

AS A JOSENIAN IE ^^ (15 decks)

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