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Intro To Management > Topic 2B Strategy (chapter 6) > Flashcards

Topic 2B Strategy (chapter 6) Flashcards

1
Q

Benchmarking

A

A process by which a company compares its performance with that of high-performing organizations

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2
Q

Business- level strategy

A

Focuses on individual business units or product/service lines

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3
Q

Contingency Planning

A

Creation of alternative hypothetical but equally likely futures conditions

Also called scenario planning and scenario analysis

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4
Q

Corporate- level strategy

A

Focuses on the organization as a whole

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5
Q

Differentiation strategy

A

Offer products that are of unique and superior value compared to those of competitors and target a wide market.

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6
Q

Diversification

A

Moving into and/ or operating new lines of business

Products may be related or unrelated

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7
Q

Execution

A

Consists of using questioning, analysis, and follow-through in order to mesh strategy with reality, align people with goals, and achieve results promised

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8
Q

Focused- differentiation strategy

A

Offer products that are of unique and superior value compared to those of competitors and target a narrow market.

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9
Q

Forecast

A

A vision or projection of the future

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10
Q

Functional- level strategy

A

Plan of ­action by each functional area of the organization to support higher level strategie

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11
Q

Market

A

can be thought of as a group of customers with similar needs or preferences

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12
Q

Organizational opportunities

A

Environmental factors that the organization may exploit for competitive advantage

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13
Q

Organizational strengths

A

The skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its mission

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14
Q

Organizational threats

A

Environmental factors that hinder an organization’s achieving a competitive advantage

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15
Q

Organizational weaknesses

A

The drawbacks that hinder an organization in executing strategies in pursuit of its mission

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16
Q

Porter’s 4 competitive strategies

A
  1. Cost- leadership strategy
  2. Differentiation strategy
  3. Cost- focus strategy
  4. Focused- differentiation strategy
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17
Q

Related diversification

A

When a company purchases a new business that is related to the company’s existing business portfolio

18
Q

Scenario analysis

A

Also known as scenario planning and contingency planning; the creation of alternative hypothetical but equally likely future conditions

19
Q

Strategic control

A

Monitoring the execution of strategy and taking corrective action, if necessary

20
Q

Sustainable competitive advantage

A

Exists when other companies cannot duplicate the value delivered to customers

21
Q

SWOT analysis

A

A situational analysis in which a company assesses its strengths, weaknesses, opportunities, and threats

22
Q

Trend analysis

A

Hypothetical extension of a past series of events into the future

23
Q

Unrelated diversification

A

Occurs when a company acquires another company in a completely unrelated businesses

24
Q

Vertical integration

A

Firm expands into businesses or activities that provide the supplies (product inputs) it needs or that distribute and sell its products

25
Q

VRIO

A

A framework for analyzing a firm’s resource or capability to determine its competitive strength or power

26
Q

What is a strategy, or strategic plan?

A

Sets the long term goals and direction for the organization
Consists of a company’s action plan for outperforming its competitors and achieving superior profitability

27
Q

What key 3 principles underlie strategic positioning?

A
  1. Strategy is the creation of a unique and valuable position
    - serve a few needs, many customers
    - serve broad needs, few customers
    - serve broad needs, many customers
  2. Strategy requires trade-offs in competing
    - “trade-offs” require focus; you can’t be “all things to all people”
  3. Strategy involves creating a “fit” among the activities managed by a business
    Ex) supply chain management
    - manufacturing
    - marketing/ sales
28
Q

A company’s strategy needs to have what, to draw customers in?

A

Distinctive element

29
Q

What is the 1st step of the strategic management process?

A
  1. Establish the mission, vision, and values statements
30
Q

What is the 2nd step of the strategic management process

A
  1. Assess the current reality

Assessment tools:
- competitive intelligence
- SWOT analysis
- VRIO
- forecasting
- benchmarking

31
Q

What is the 3rd step of the strategic management process

A
  1. Formulate corporate corporate, business, and functional strategies
32
Q

What is the 4th step in the strategic management process

A
  1. Execute the strategies
33
Q

What is the 5th step in the strategic management process

A
  1. Maintain strategic control
34
Q

VRIO: value meaning…

A

Is the resource or capability valuable?

35
Q

VRIO: Rarity meaning….

A

Is the resource or capability currently controlled by only a few firms or no other firms?

36
Q

VRIO: Imitability meaning…

A

Is the resource or capability costly or difficult for other firms to imitate?

37
Q

VRIO: Organization meaning…

A

Is the firm organized to exploit the resource or capability?

38
Q

Cost- leadership strategy

A

Keep the costs, and hence prices, of a product or service below those of competitors and target a wide market.

39
Q

Cost-focus strategy

A

Keep the costs of a product below those of competitors and target a narrow market

40
Q

Wide Markets

A

consists of a broad group of customers that purchase a range of different types of products

EX) The market for all kinds of chocolate products

41
Q

Narrow Market

A

usually consists of a subset of customers (a “segment” or “niche”) within a broader market

EX) The market for expensive, luxury chocolate suitable for gifts

42
Q

What are the 4 key steps of keeping a strategic plan on track:

A
  1. engage people
  2. keep it simple
  3. stay focused
  4. keep moving

Intro To Management (6 decks)

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