STRATEGIC MANAGEMENT CH 1

annual objectives

Represent the basis for allocating resources

understanding

____________ the most important benefit of strategic management, followed by commitment

ownership of strategies

______________________ by the people who have to execute them is a key to success

strategic plan

a company's game plan

empower individuals

a great benefit of strategic management, then, is the opportunity that the process provides to ____________________

competitive advantage

all about gaining and maintaining - as it is esssntial for long-term success "anything that a firm does especially well compared to rival firms" or when a firm can do something that rival firms cannot do, or owns something that rival firms desire.

strategic management

allows an organization to be proactive than reactive in shaping its own future; it allows an organization to initiate and influence activities - and thus to exert control over its own destiny

environmental scanning

also known as "industry analysis"; process of conducting research and gathering and assimilating external information

internal strengths and weaknesses

an organization's controllable activities that are performed especially well or poorly

strategy implementation strategy formulation

annual objectives are especially important in ___________, whereas long-term objectives are particularly important in ________________

e-commerce and globalization

are external changes that are transforming business and society today

opportunities and threats

are largely beyond the control of a single organization - thus the word "external"

strategies

are potential actions that require top management decisions and large amounts of the firm's resources

strategies

are the means by which long-term objectives will be achieved

competitive team

by fostering communication and interaction among managers and employees across hierarchical levels, strategic management helps a firm function as a ______________________________

strategic management process

can be describes as an objective, logical, systematic approach for making major decisions in an organization

strengths and weaknesses

can be determined relative to a firm's own objectives

Vision Statement

expresses what the organization should become, where it wants to go strategically; often considered the first step in strategic planning, preceding even development of a mission statement.

strategy evaluation

final stage in strategic management; primary means of obtaining information

Strategic Management

focuses on integrating management, marketing, finance/accounting, production/ operations, research and development , and information systems to achieve organizational success

strategists

have various job titles: ceo, president, owner, chair of the board, executive director, chancellor, dean, or entrepreneur.

strategists

help an organization gather, analyze, and organize information. they track industry and competitive trends, develop forecasting models ad scenario analyses, evaluate corporate and divisional performance, spot emerging market opportunities, identify business threats, and develop creative action plans

strategy implementation

includes developing a strategy-supportive culture, creating an effective organizational structure, redirecting marketing efforts, preparing budgets, developing and utilizing information systems, and linking employee compensation to organizational performance

intuition and analysis

most organizations can benefit from strategic management, which is based upon integrating ____________ and _____________ in decision making

competitive advantage strategists vision and mission statements external opportunities and threats internal strengths and weaknesses long-term objectives strategies annual objectives policies

nine (9) key terms in strategic management:

strategy implementation

often called the "Action stage" or the "difficult stage" in strategic management, as it requires discipline, commitment, and sacrifice.

lobbying

one activity that some organizations utilize to influence external opportunities and threats

intuition

particularly useful for making decisions in situations of great uncertainty or little precedent

lack of knowledge or experience in strategic planning poor reward structures firefighting waste of time too expensive laziness content with success fear of failure overconfidence prior bad experience self-interest fear of the unknown honest difference of opinion suspicion

reasons for poor or no strategic planning:

external and internal opportunities

refer to economic, social, cultural, demographic, environmental, political, legal, governmental, technological, and competitive trends and events that could significantly benefit or harm an organization in the future

strategic planning

referring only to strategy formulation

strategy implementation

requires a firm to establish annual objectives, devise policies, motivate employees, and allocate resources so that formulated strategies can be executed

strategic plan

results from tough managerial choices among numerous good alternatives, and it signals commitment to specific markets, policies, procedures, and operations in lieu of other, "less desirable" courses of action.

annual objectives

short-term milestones that organizations must achieve to reach long-term objectives; similar to long-term objective, it must be measurable, quantitative, challenging, consistent, realistic, and prioritized

objectives

specific results that an organization seeks to achieve in pursuing its basic mission

corporate divisional or strategic business unit functional

strategy formulation, implementation, and evaluation activities occur at three (3) hierarchical levels in a large organization:

empowerment

the act of strengthening employees' sense of effectiveness by encouraging them to participate in decision making and to exercise initiative and imagination, and rewarding them for doing so.

strategic management

the art and science of formulating, implementing, and evaluating cross-functional decisions that enable an organization to achieve its objectives

strategists

the individuals who are most responsible for the success or failure of an organization

policies

the means by which annual objective will be achieved; includes: guidelines, rules, and procedures established to support efforts to achieve stated objectives are guides to decision making and address repetitive or recurring situations

decentralized line-manager planning

the notion centralized staff planning is being replaced in organizations by ___________________________

strategic management

used synonymously with the term strategic planning

Mission Statement

"enduring statements of purpose that distinguish one business from other similar firms. It identifies the scope a firm's operations in product and market terms."

reviewing external and internal factors that are the bases for current strategies measuring performance taking corrective actions

3 fundamental strategy-evaluation:

strategy formulation strategy implementation strategy evaluation

3 stages of strategic management:

mission statement

describes the values and priorities of an organization; broadly charts the future direction of an organization

strategy formulation

developing a vision and mission, identifying an organization's external opportunities and threats, determining internal strengths and weaknesses, establishing long-term objectives, generating alternative strategies, and choosing particular strategies to pursue. (just a plan, no action)

participation

is the key to gaining commitment for needed changes

strategic management process

it attempts to organize qualitative and quantitative information in a way that allows effective decisions to be made under conditions of uncertainty.

objectives

it states direction; aid in evaluation; create synergy; reveal priorities; focus coordination; and provide a basis for effective planning, organizing, motivating, and controlling activities should be challenging, measurable, consistent, reasonable, and clear

strategic management

its purpose is to exploit and create new and different opportunities for tomorrow; "long-range planning", in contrast, tries to optimize for tomorrow the trends of today.