Topic 2A Planning (chapter 5)

Question 1

Action plan

Answer 1

Course of action needed to achieve a stated goal

Question 2

Business model

Answer 2

Describes how its strategy will create value for the customer and at the same time generate revenues sufficient to cover costs and realize a profit

Question 3

Business plan

Answer 3

A document that outlines a proposed firm’s goals, the strategy for achieving them, and the standards for measuring success

Describes the company’s “business model”

Question 4

Cascading goals

Answer 4

is the process of ensuring that strategic goals set at the top level align, or “cascade” downward with more specific short-term goals at lower levels within an organization, including employees’ objectives

Question 5

Customer value proposition goal

Answer 5

Describes
(1) company’s approach to satisfying buyer needs or wants

(2) at a price the customer will consider a good value

Question 6

Long-term goals (2 things)

Answer 6

1. Generally referred to as strategic goals
2. Tend to span 1 to 5 years and focus on achieving the strategies identified in a company’s strategic plan

Question 7

Management by objectives (MBO)
(4 steps)

Answer 7

(1) managers and employees jointly set objectives for the employee

(2) managers develop action plans

(3) managers and employees periodically review the employee’s performance

(4) the manager makes a performance appraisal and rewards the employee according to results

Question 8

Mission statement (3 things)

Answer 8

Statement that expresses the purpose of the organization

1. Express the purpose of the organization.
2. What is our reason for being?
3. Why are we here?

Question 9

Objective

Answer 9

Also known as goal; a specific commitment to achieve a measurable result within a stated period of time

Question 10

Operating plan

Answer 10

Typically designed for a 1-year period, this plan defines how a manager will conduct his or her business based on the action plan; the operating plan identifies clear targets such as revenues, cash flow, and market share

Question 11

Operational goals

Answer 11

Goals that are set by and for first-line managers and are concerned with short-term matters associated with realizing tactical goals

Question 12

Operational planning
Planning/ control cycles
1- 52 weeks

Answer 12

Determining how to accomplish specific tasks with available resources within the next 1-week to 1-year period; done by first-line managers

Question 13

Short-term goals (2 things)

Answer 13

1. Sometimes referred to as tactical or operational goals, or just plain goals
2. Generally span 12 months and connected to strategic goals in a hierarchy known as a means-end chain

Question 14

SMART goals, what are the 5 keys terms

Answer 14

Specific:

Measurable

Attainable

Results-oriented

Target dates

Question 15

Strategic goals

Answer 15

Goals that are set by and for top management and focus on objectives for the organization as a whole

Question 16

Strategic management

Answer 16

A process that involves managers from all parts of the organization in the formulation and the implementation of strategies and strategic goals

Question 17

Strategic planning
1- 5 years

Answer 17

Determines what the organization’s long-term goals should be for the next one to five years with the resources they expect to have available

Question 18

A Strategy

Answer 18

or strategic plan, sets the long term goals and direction for the organization.

Question 19

Tactical goals

Answer 19

Goals that are set by and for middle managers and focus on the actions needed to achieve strategic goals

Question 20

Tactical planning
6 - 24 months

Answer 20

Determining what contributions departments or similar work units can make with their given resources during the next 6 months to 2 years; done by middle management

Question 21

Value statement (2 things)

Answer 21

1. What the company stands for: its core priorities, the values its employees embody, and what its products contribute to the world
2. What values do we want to emphasize?

Question 22

Vision

Answer 22

A long-term goal describing “what” an organization wants to become; it is a clear sense of the future and the actions needed to get there

Question 23

Vision statement (3 things)

Answer 23

Statement that expresses what the organization should become and where it wants to go strategically

1. A clear sense of the future and the actions needed to get there
2. What do we want to become?
3. Where do we want to go

Question 24

A business model contains what 2 things:

Answer 24

1. Customer value proposition
2. Profit formula

Question 25

Without a viable (successful) business model, the firm may fail to what?

Answer 25

1. Attract customers
2. Withstand or beat competition
3. Survive due to lack of profitability

Question 26

Typically, strategy consists of a company’s action plan for outperforming its what?

Answer 26

its competitors and achieving superior profitability

Question 27

Why are Planning and Strategic Planning Important? (3 things)

Answer 27

• Provide direction and momentum

•Encourage new ideas

•Develop a sustainable competitive advantage

Question 28

Planning and strategic management consists of what?

Answer 28

1. Establish the mission and vision and values
2. Assess the current reality
3. Formulate the grand strategy and strategic, tactical, and operational plans
4. Implement the strategy
5. Maintain strategic control

Question 29

The Specific in SMART Goals means what

Answer 29

Goals should be stated in specific rather than vague terms.

Question 30

Measurable in SMART Goals means what?

Answer 30

Whenever possible, goals should be measurable, or quantifiable

Question 31

Attainable in SMART Goals means what?

Answer 31

Goals should be challenging, of course, but above all they should be realistic and attainable

Question 32

Results- oriented in SMART Goals means what?

Answer 32

Only a few goals should be chosen for any work unit. And they should be results-oriented—they should support the organization’s vision

Question 33

Target dates in SMART Goals means what?

Answer 33

Goals should specify the target dates or deadline dates when they are to be to be obtained

Question 34

Management by objectives (4 steps)

Answer 34

1.Managers and employees jointly set objectives for the employee

2.Managers develop action plans

3.Managers and employees periodically review the employee’s performance

4.Managers make a performance appraisal and reward the employee according to the result

Question 35

What are the 3 objectives used in MBO

Answer 35

Performance

Behavioral

Learning

Question 36

Performance objectives

Answer 36

Focus: Express the objective as an outcome or end-result

Examples: “Increase sport utility sales by 10%.” “Reduce food spoilage by 15%.”

Question 37

Behavioral objectives

Answer 37

Focus: Express the objective as the behaviors needed to achieve an outcome

Examples “Greet all potential automobile customers with a smile and offer to assist.” “Ensure food is stored in seal-proof containers.

Question 38

Learning objectives

Answer 38

Focus: Express the objective in terms of acquiring knowledge or competencies

Examples “Attend sales training class.” “Learn how the features in our sports utility vehicles compare to competitors.”

Question 39

For MBO goal- setting to succeed, the following 3 things that need to happen are…

Answer 39

1.Top management must be committed to it

2.Goals must be applied consistently throughout the organization

3.Goals must “cascade” down through the organization

Question 40

What are the 4 -parts of the planning and control cycle

Answer 40

1. Make the plan
2. Carry out the plan
3. Control the direction by comparing the results with the plan
4. Control the direction in 2 ways:
   (1) correcting deviations in the plan being carried out (return to step 2) OR

(2) improving future plans (go to plan 1 to start over)