1-5 Study

What are the four essential components of corporate strategy?

1. Allocation of resources 2. Organizational design 3. Portfolio management 4. Strategic trade-offs.

Describe the planning process.

1. Develop the roadmap or series of objectives 2. Be willing to adapt 3. handle people well 4. Have considerable energy, moral courage, professional competence and general business knowledge.

What are the core traits of leaders as described by Edwin Locke?

1. Drive 2. Leadership motivation 3. Honesty and Integrity 4. Self-Confidence 5. Cognitive ability 6. Knowledge of the business 7. Other traits like charisma, creativity, flexbility,

What are 3 elements of performance metrics?

1. Establishing critical processes/customer requirements 2. Identifying specific, quantifiable outputs of work 3. Setting targets against which results can be scored

What are the 4 main components of full-range theory?

1. Individualized consideration 2. Intellectual stimulation 3. Inspirational motivation 4. Idealized influence

According psychologist Robert Katz, what are the three main areas of skills are necessary to be an effective manager?

1. Technical skills 2. Communication or human relations skills 3. Conceptual skills.

What are the four fundamental management functions? (also called management process" by Henri Fayol)

1. planning 2. organizing 3. leading 4. controlling

What is a liability?

A "liability" is an obligation or something you "owe." The obligation may include a requirement to pay cash, transfer assets, or provide services to someone else. Assets are used to pay off liabilities. The other option to pay off liabilities is using the owner's investment in the company or owner's equity. Owner's equity is a residual claim or interest. A residual claim means it is the value of the assets after all of the obligations from the liabilities have been satisfied.

Describe Differentiation

A firm's ability to create a good that is difficult to replicate, thereby fulfilling niche needs. This strategy can include creating a powerful brand image, which allows the organization to sell its products or services at a premium. Coach handbags are an excellent example of differentiation; the company's margins are high due to the markup on each bag (which mostly covers marketing costs, not production).

Describe Cost leadership

A firm's ability to create economies of scale through extremely efficient operations that produce a large volume. Cost leaders include organizations such as Procter & Gamble, Walmart, McDonald's, and other large firms generating a high volume of goods that are distributed at a relatively low cost

A hardworking, dependable employee is struggling to perform a particular job. What is the first step a manager should take before assigning this employee to another job? Refer the employee to human resources for an evaluation Provide the employee with training and a mentor Contact the employee's union representative for suggestions Identify the employee's strengths and weaknesses

A great manager understands an employee's strengths and weakness before determining the best approach to help a struggling employee.

What is drive?

A high level of effort, including a strong desire for achievement as well as high levels of ambition, energy, tenacity, and initiative

What is a mission statement?

A mission statement defines the organization's goals, values, and reason for existence.

What is Fiedler's contingency model of leadership?

A model that focuses on the interaction of leadership style and the situation (later called situational control).

What is the function of a tactical plan? Committing significant resources Emphasizing future operations Identifying short-term actions Creating long-term goals

A tactical plan identifies the steps required to achieve the strategic goals of the organization. The plan is specific, and is adjusted as the strategic goals are changed based on organizational and environmental conditions.

What is the "Great Man" theory?

A theory proposed by Thomas Carlyle in the mid-1800s that certain traits produce certain behaviors, patterns of behavior are consistent in different circumstances, and people are born with these traits. eg) You are either born to be a leader or not.

Describe Strategic objectives and analysis (SWOT)

A thorough internal investigation of an organization to assess its strengths (S) and weaknesses (W) and an appraisal of the external competitive environment looking for any opportunities (O) or threats (T). A useful acronym, PESTLE, can be used to evaluate political, economic, social, technological, environmental, and legal factors that may affect an organization's strategy.

What is a vision?

A vision is defined as a clear, distinctive, and specific view of what a company would like to achieve in the future.

What are the pros and cons of a diversified portfolio?

A well-diversified portfolio of companies will mitigate risk if the market changes significantly but may also stretch the core competencies of the organization further than a more focused approach would. It is more difficult for a company to be the market leader in three companies producing a range of products or services than it would be if all efforts were focused on one product or service.

To ensure a productivity goal is met, a manager provides new computers and software updates for all employees in the company. Which aspect of a SMART goal is reflected by this manager's action? Time-bound Achievable Strategic Operational

Achievable. When setting achievable SMART goals, it is important to make sure that the resources needed to accomplish a task are available to the employees.

What are administrative expenses?

Administrative expenses are nonmanufacturing costs that include the costs of top administrative functions and various staff departments such as accounting, data processing, and personnel. Executive salaries, clerical salaries, office expenses, office rent, donations, research and development costs, and legal costs are administrative costs. As with selling costs, all organizations have administrative costs.

Chief marketing officer (CMO), Cynthia Troutman, was tasked with developing and communicating a marketing brand to win over new customers for the new rechargeable battery. Which managerial attribute should she use to successfully complete this assignment on this tight timeline? Eyeing the horizon Taking on risk Allocating proper resources Creating vision

Allocating proper resources. Managers are responsible for working through and with others to efficiently and effectively complete activities that meet the goals of the organization.

What is the difference between an income statement and a balance sheet?

An income statement shows the change in the financial status of an organization over a specified period, whereas a balance sheet shows a list of the assets, liabilities, and stockholders' equity at a specific date, usually the end of a month, quarter, or year.

Which management style is likely to alienate employees? Authoritarian Democratic Laisse-faire Persuasive

Authoritarian. A manager with little or no people skills can end up using an authoritarian leadership style and alienating employees

A manager or leader who motivates desired behavior by scolding employees who arrive late to meetings and showing appreciation when they are early or on time. What theory does this example?

Behavior theory: rewards and punishments

What theory incorporates B. F. Skinner's theory of behavior modification, which takes into account the effects of reward and punishment on changing behavior?

Behavioral Theory

Chief marketing officer (CMO), Cynthia Troutman, is setting SMART goals for developing the new marketing brand for Sure Start. One of the goals involves increasing new customers for the rechargeable electric batteries. Which SMART goal should be used to obtain this result? Send out emails to the top auto manufacturers worldwide to promote the new electric battery product line as an eco-friendly choice By the end of the calendar year, buy placement in the top auto industry print publications in U.S., German, and Chinese markets Advertise in magazines in all of the countries where Sure Start wants to attract new automotive customers and offer discounts Increase the number of new customers who have heard of Sure Start's rechargeable electric battery through advertising and promotion

By the end of the calendar year, buy placement in the top auto industry print publications in U.S., German, and Chinese markets. This goal is clear, measurable, time bound, and motivating.

Carl Spith (COO) was tasked by Charlie (CEO) to relocate to Vietnam to open an office there and eventually to manufacture batteries within that country. How is Carl's power to manage others different than Charlie's power to lead? Charlie's power comes from his appointment to his position. Charlie's power is based on his use of authority to get compliance. Carl's power is derived from his ability to persuade others to follow him. Carl's power comes from his position within the hierarchy of the organization.

Carl's power comes from his position within the hierarchy of the organization. Carl's source of power comes from the larger organization and as his title of Chief Operations Officer.

What are cash receipts?

Cash receipts is a term used to describe money flowing into a business. It may include the following: Cash from cash sales (received in the month of sale) Cash from debtors who are paying for a past month's credit sale Sales of capital assets Short-term bank financing Accounts receivable financing Inventory financing Unsecured financing

The chief operating officer (COO) of an organization understands how the various parts of the system are interdependent. The COO also recognizes how the smooth operation of the organization produces value for customers.Which type of leadership skill is being illustrated by this COO? Conceptual Technical Interpersonal Problem-solving

Conceptual skills include the ability to view the organization as a whole, understand how the various parts are interdependent, and understand how it produces value for customers.

What is a production budget?

Consists of the costs inside the organization. Product costs are the costs a company assigns to units produced. Examples of product costs include the cost of producing an automobile; the cost of making and serving a meal in a restaurant; or the cost of teaching a class in a university.

Define community relations

Contact must be maintained and nurtured with representatives from various constituencies outside the company, including state and federal agencies, local civic groups, and suppliers.

Which strategy describes a company singularly focused on achieving economies of scale? Differentiation Market segmentation Cost leadership Customer-driven

Cost leadership. Gaining economies of scale allows an organization to create operational efficiencies and cost reduction through an increased production volume. This competitive strategy is focused on achieving higher profits through lower costs that create a competitive advantage.

What are expenses?

Cost of Goods Sold (COGS)—All costs in material, labor, and overhead that are directly required for the production and/or manufacturing of a given good. Selling and General Administration (SG&A) —These costs are support costs, such as the salaries of HR staff, management, legal, accounting, marketing, and other broader corporate expenses that benefit the sale of a particular good.

Which leadership attribute does Charlie Wicker demonstrate during the expansions being undertaken by Sure Start? Enacts the direction Eyes bottom line Creates a vision Manages the process

Creates a vision. A vision describes where a company wants to be in the future. Charlie wants Sure Start to enter into the rechargeable battery market.

Which information does a projected income statement report as a function of the budget-planning process? Current profit Deferred revenue Sales plan Market share

Current profit. The projected income statement contains sales and other data from the previous financial period. This provides information on current profit and expenses.

What is a decentralized organization? (organizational design)

Decision-making authority is spread out among employees. The benefits of a decentralized system include quicker answers for questions, faster resolution of problems, and more autonomy for employees. The drawback of a decentralized system can be a feeling of decreased control in higher levels of the administration.

What is a centralized organization?

Decisions are made by a few key people and passed down to employees. A centralized system allows for more consistency and control in decision-making but may increase the length of time customers must wait for answers or a resolution for a problem. A centralized system of administration may also lead to a feeling of dissatisfaction in employees due to a lack of autonomy and decision-making authority.

What is deferred revenue?

Deferred revenue appears on the balance sheet of a company as a liability. It refers to revenue that has not been earned and represents products or services that are owed to a customer.

What is a strategy?

Defines its competitive advantage and delineates how it will achieve economic, social, and environmental performance objectives; in essence, it helps bridge the gap between the long-term vision and the short-term decisions.

What is a direct labor budget?

Direct labor costs include the labor costs of all employees actually working on materials to convert them into finished goods. As with direct material costs, direct labor costs of a product include only those labor costs clearly traceable to, or readily identifiable with, the finished product. The wages paid to a construction worker, a pizza delivery driver, and an assembler in an electronics company are examples of direct labor.

Which decisional role does a manager play within an organization? Advocate Liaison Entrepreneur Disseminator

Entrepreneur is a decisional role a manager plays. This involves interpreting information and acting to improve a business.

As the leader of the organization, in which task must Charlie Wicker excel for Sure Start to be successful? Controlling existing circumstances Implementing the plan Administering detailed processes Establishing a direction

Establishing a direction. This task is the essence of leadership, which is Charlie's job for Sure Start.

What is a function of leadership? Establishing vision and mission Focusing on processes Maintaining order and stability Executing strategic plans

Establishing vision and mission is a function of leadership. Leadership focuses on setting direction for a company and establishing vision and mission is the most significant way in which this occurs.

Define long-range planning

Executive managers do strategic planning and determine the principal objectives that must be met to meet the mission of the organization while staying focused on the ideals and values of the organization.

What is the Least Preferred Coworker (LPC) scale?

Fiedler's scale to determine which traits a leader least likes in a coworker. A high LPC score suggests that a person has a positive orientation toward human relations, and a low LPC indicates that the leader relies more on the nature of the task to drive leadership

What are the two major components of the master budget? Direct materials and overhead budgets Selling and administrative budgets Financial and operating budgets Capital expenditures and cash budgets

Financial and operating budgets. The master budget is comprised of the operating budget and the financial budget.

What are the four perspectives in a balanced scorecard

Financial: includes measures focused on the question "How do we look to shareholders?" Customer: includes measures focused on the question "How do customers perceive us?" Internal business processes: includes measures focused on the question "What must we excel at?" Learning and growth: includes measures focused on the question "How can we continue to improve and create value?"

How do you create a leadership movement?

First, you have to decide on your cause. What's the one strategic issue your company needs to get after right now - the one thing that will make a big difference to both the company and employees?

What are fixed expenses?

Fixed expenses are those costs that remain the same no matter how many units are sold. Examples of fixed expenses can be administrative salaries, depreciation of a building or equipment, rent, heat, light, insurance, dues, equipment leases, and advertising. Since fixed expenses do not change, the more you sell, the more the expense is distributed.

Corporate leadership of a company informs the sales managers that they will need to adopt and use differentiation strategies to help improve operational performance at the beginning of the next fiscal year. Which action should the sales team take to meet this directive? Liquidate existing inventory to create new sales opportunities Focus on strengthening the company's branding Target a segment of the market that is not being addressed Sell a large volume of goods at a low cost

Focusing on branding is a key element of the differentiation competitive strategy.

Describe Strategic formulation (SWOT)

Goals and objectives are written based on the information obtained from the PESTLE and SWOT analyses. Goals are broad, primary outcomes the organization is hoping to achieve. Objectives are measurable, quantitative statements a manager can use to evaluate an organization's, department's, or employees' progress toward meeting their goals. Help identify whether the organization needs to obtain additional resources, watch for a specific threat, or change a set of internal processes.

What are the 3 key areas in Fiedler's contingency model of leadership?

His theory emphasizes three key areas: the leader's personality, the task itself, and whether the leader can exert control over the group.

As Sure Start works to establish their offices in Germany and Vietnam, its managers will be doing so in cultures that they are not familiar with and will be hiring local employees to fill the positions. According to Robert Katz, which managerial attribute will support expansion into these new markets? Conceptual understanding Long-term vision Human relation skills Technical skills

Human relation skills. These are the interpersonal skills managers use to accomplish goals.

Which report shows the change in the company's financial performance over a stated period of time? Balance sheet Sales budget Income statement Revenue projection

Income statement.

Describe Allocation of resources

Involves both people and capital. The strengths and weaknesses of employees need to be identified so they can be placed in the role where they provide the most value to the company. There is a limit to the amount of capital any organization has at its disposal. Both money and people need to be utilized in a way that earns the organization the highest risk-adjusted return on investment

Over the course of the next 3-5 years, a firm looks to grow revenue by 10%, expand into two new geographic markets, and launch two new projects which are currently in the research and development stage. Which business component is being addressed by this firm? Short-term goals Long-term goals Grand strategies Vision statements

Long-term goals are mission-supporting activities that a firm seeks to accomplish within a 3-5-year timeframe.

Sure Start's mission is "to be the preferred mass producer of rechargeable batteries for electric cars" in the industry. Its vision is: "At Sure Start, we know it is important you know your car will start every time. That is why we are dedicated to producing quality batteries that work every time you start your car." Which statement accurately illustrates how Sure Start should use their goals to support this mission and vision? Short-term goals are not necessary for Sure Start to develop each year if its long-term goals follow the SMART goal guideline of being specific, measurable, achievable, realistic, and time constrained. Short-term goals that are set annually will only matter to investors that Sure Start may use in the future to fund expansion programs. Long-term goals are only necessary if Sure Start decides to go in a different direction than the mission and vision. Long-term goals will help Sure Start define where it intends to be in 3-5 years, while short-term goals will help focus on what needs to be accomplished within one year, in support of its mission.

Long-term goals will help Sure Start define where it intends to be in 3-5 years, while short-term goals will help focus on what needs to be accomplished within one year, in support of its mission.

define monitoring products and services

Managers get involved in planning, scheduling, and tracking the design, development, production, and delivery of the organization's products and services.

Define environmental scanning.

Managers must continually watch for changes in the business environment. Track profit and loss statements, cash flow statements, stock trends to garner and protect market share.

Describe the negotiating/leading process.

Managers must have a thorough knowledge of each employee and be able to maintain a balance between the needs of the organization and the needs of an individual.

Define Customer relations and marketing

Managers must monitor customer satisfaction and develop policies on how to handle customer complaints. Watch marketing plan is and whether dollars are correctly spent to reach the market that will most likely buy their product.

Define coordinating

Managers often must coordinate the work of others both inside the work unit and out.

Define supervision

Managers oversee the work of their subordinates. responsible for the actions of employees under their supervision. They must walk a fine line between being controlling and being too laissez-faire.

Describe entrepreneurs

Managers that seek to improve their businesses, adapt to changing market conditions, and react to opportunities as they present themselves.

Describe performance metrics

Metrics measure an organization's behavior, activities, and performance. To be effective, the metric should relate to a range of stakeholder needs, including those of customers, shareholders, and employees. Metrics may be finance-based, or they may focus on some other measure of performance, such as customer service or customer perceptions of the product value.

A manager is asked to initiate activities that will support environmental scanning.Which activity should be used by this manager for this purpose? Monitoring competitors Reviewing production Setting the advertising budget Implementing a new program

Monitoring competitors. The competitive marketplace should be monitored as part of environmental scanning.

Describe the controlling process.

Monitoring progress and correcting for any veering off path. Correct any employee misbehavior and take corrective action concerning the allocation and use of human, financial, and material resources.

Describe market segmentation

Narrow in scope (both cost leadership and differentiation are relatively broad in scope) and is a cross between the two strategies. Segmentation targets finding specific segments of the market, which are not otherwise tapped by larger firms.

What is Operations management?

Operations management involves the actual implementation of the strategic plans by transforming inputs (labor, capital, equipment, land, buildings, materials, and information) into outputs (goods and services) as efficiently as possible to maximize the profit of an organization. Usually encompass one to two years

Which function is a manager performing when developing the department's annual budget? Organizing Planning Controlling Negotiating

Organizing. When developing the department's annual budget, the manager is matching resources to the plan developed to achieve the goals of the organization.

What are the two most important resources a manager has?

People and money.

Describe Strategic evaluation and control (SWOT)

Performance measurements will help determine if critical milestones are being met. Corrective actions are taken if the actual result varies from the strategic plan. Reexamining the goals. New plans may need to be formulated or organizational structures adjusted. Personnel may need to be retrained or shifted to other duties.

What are examples of operational strategy decisions?

Planning how a product will be made or service delivered Determining milestones and a timeline for a project Delineating the individual tasks that comprise the plan Deciding which department is responsible for implementing each task Using analytics to track milestones, budget, and return on investment

Which factor impacts a manager's roles and responsibilities? Style of leadership Financial performance of the department Outside competitive forces Position within the organizational hierarchy

Position within the organizational hierarchy. The roles and responsibilities vary according to whether the individual is a top manager, middle manager, first-line manager, or team leader.

Charlie wants Sure Start to be an early market entrant in the electric car rechargeable battery market since it is new and no one is established as the industry leader. In which operational strategy category is Sure Start focusing their efforts? Developing a well-integrated company Maximizing the organization's core competencies Producing products that focus on market position Creating a system to measure competitive priorities

Producing products that focus on market position. Sure Start is looking to take create valuable market position by being one of the first in the market.

What are the seven primary operations functions?

Product management Supply chain management Inventory management Forecasting Scheduling Quality assurance Facilities planning and management

A manager is working on department production goals set by a director and needs to illustrate how planning will be used in the next project. Which action illustrates this component? Determining if the project was profitable this month Projecting the number of units that will be sold Forming a committee to interview potential employees Appointing a new production manager

Projecting the number of units that will be sold. This is part of planning and is used to project the outcome of the activity.

Define reactive leadership

Reactive leadership occurs by not planning ahead to handle problems or opportunities.

A manager is responsible for controlling and overseeing a small company.Which management attribute is needed to undertake this set of responsibilities? Changemaker Risk-taker Resource allocator Visionary

Resource allocator. This management attribute would help with the overseeing of a small company by managing the flow of resources in a situation in which error should be minimal.

What are the typologies of power as outlined by French and Raven?

Reward power Coercive power Referent power Expert power Legitimate power

What are examples of tactical decisions?

Scheduling workforce Establishing quality assurance procedures Contracting with vendors Managing inventory

What are selling costs?

Selling expenses are costs incurred to obtain customer orders and get the finished product in the customers' possession. Advertising, market research, sales salaries and commissions, and delivery and storage of finished goods are selling costs. The costs associated with delivery and storage of finished goods fit under the heading of selling costs, because they are incurred after production has been completed. The cost of storing material is part of manufacturing overhead. Remember that retailers, wholesalers, manufacturers, and service organizations all have selling costs.

A fast food chain restaurant seeks to open three more locations in a geographic territory within a one-year timeframe. Which type of goal is being used for this expansion? Immediate-term Short-term Long-term Ultra-long-term

Short term goals are operational issues a firm seeks to address within a 1-year period.

What are objectives?

Short, measurable actions, are usually written to provide more detail. The objectives should state what will be accomplished, when it will be done by, and how much will be done

Define internal consulting

Some managers make use of their technical expertise to solve internal problems, acting as inside consultants for organizational change and development.

Chief Financial Officer (CFO) Darris Johnson is recommending that senior leadership create clearly defined goals for both the short term and the long term. Which short-term goal should be created by the senior leadership? Hiring a replacement General Manager for the Asian market. Determining the marketing strategy for the next generation of rechargeable batteries Staffing the Vietnam office with the appropriate headcount Increasing the customer pool by 150%

Staffing the Vietnam office with the appropriate headcount. Leadership's focus for the immediate future should be hiring staff for the Asia office.

An individual was recently promoted to an executive management position and will frequently be involved in creating objectives that meet the mission of the organization.Which type of planning will this executive be required to perform? Tactical Strategic Operational Contingency

Strategic planning involves long-range planning by executive management to determine the principle objectives of the organization.

What is operations strategy?

The "how" that follows the "what" of business strategy. It includes the entire process of production from beginning to end.

The head of the information technology (IT) department gathers, collates, analyzes, and disseminates information on a new computer networking project.Which management role is being performed by the head of this department? Informational Decisional Interpersonal Liaison

The informational role is to gather, collate, analyze, and disseminate information. Managers who are performing this role become information resource centers.

What is the operating budget?

The operating budget can be made up of the sales plan, production plan, materials purchasing plan, labor hiring and training program plan, and administrative and discretionary spending data.

What is the difference between the operating budget and the master budget?

The operating budget involves direct materials, overhead, selling, administrative, capital expenditures, and cash budgets. The master budget involves financial budget (projected balance sheet) and planned operating budgets (projected income statement).

Strategic implementation (SWOT)

The planning stops, and the action begins. Employees should be aware of their assignments, responsibilities, and authority. Management should provide any additional employee training necessary to meet the plan objectives during this stage, as well as allocate any necessary additional resources. Offering employees the tools required to implement the strategic plan, combined with personal motivation, leads to the best chance for successful implementation.

What is the mission statement of Western Governors University?

The principal mission of Western Governors University (WGU) is to improve quality and expand access to post-secondary educational opportunities by providing a means for individuals to learn independent of time or place, and to earn competency-based degrees and other credentials credible to both academic institutions and employers.

Why is it important that Sure Start managers set SMART goals during this period of growth and uncertainty? It will help ensure that Sure Start will be profitable in the years to come. They will help the managers identify goals that are focused, measurable, and well-defined to accomplish the vision of the company. They will help the company identify strategic plans that are focused, measurable, and well-defined to help them through this period of growth. It will help reassure the employees in North Carolina that they have a future with the company.

They will help the managers identify goals that are focused, measurable, and well-defined to accomplish the vision of the company. SMART goals are specific, measurable, achievable, realistic, and time constrained. They are not open ended goals.

A marketing team sets a goal to increase its product market share by 10%. Which other component of a SMART goal should the team include? Time-bound Acceptability Specificity Measurable

Time-bound. The goal needs a defined deadline for it to be achieved.

What is the function of operations management in achieving strategic goals? Transforms resources into profits Focuses on broad company outcomes Defines goals to support mission Describes long-term business goals

Transforms resources into profits. Operations management is focused on producing goods and services from inputs to create profits. Operations management is critical to implementing the day-to-day responsibilities associated with achieving strategic goals.

Describe the organizing process

Using resources in the most effective way, assigning tasks, delegating responsibilities, and determining who is reportable to whom.

What is a variable cost?

Variable costs change in relation to a specific variable, such as how many units are sold. Variables costs can include labor time, materials, electricity, wear on machines, shipping costs, and selling fees. Overhead costs are those variable costs that are not direct labor and materials or, in other words, not directly involved in the making of the product.

A company owner writes a detailed and clear picture of what the company will look like five years from now. What is he/she defining to the employees? Organizational Structure Mission Statement Innate Attribute Vision Statement

Vision Statement