chapter 5

decision criteria

the standards used to guide judgments and decisions

lower level managers are reponsible for

operational plans

tactical plans

plans created and implemented by middle managers that specify how the company will use resources, budgets, and people over the next six months to two years to accomplish specific goals within its mission

single-use plans

plans developed for activities that are not likely to be repeated in the future

length of strategic plans

5 years

There are three kinds of operational plans:

single-use plans, standing plans, and budgets.

rules and regulations

standing plans that describe how a particular action should be performed or what must happen or not happen in response to a particular event

Policies

standing plans that indicate the general course of action that should be taken in response to a particular event or situation

length of tactical plans

6 months to 2 years

decision making

Choosing among two or more alternatives.

The presence of a gap between an existing state and a desired state is no guarantee that managers will make decisions to solve problems. Three things must occur for this to happen

First, managers have to be aware of the gap. They have to know there is a problem before they can begin solving it. Managers have to be motivated to reduce the gap between a desired and an existing state. Managers must also have the knowledge, skills, abilities, and resources to fix the problem.

3. Designing the business portfolio

Multi-business firms: Minimizes risk, differentiated. -United Airlines has passengers and freight. -FedEx has packages and logistics. -IU has different schools (bus, SPEA, nursing, etc)

1. company's mission

Purpose statements should be brief—no more than two sentences. They should also be enduring, inspirational, clear, and consistent with widely shared company beliefs and values.

In the context of the planning process, _____ are primary goals. a. distal goals b. recurrent goals c. passive goals d. short-term goals

a

Identify a true statement about electronic brainstorming. a. It is usually less productive than face-to-face brainstorming. b. It leads to evaluation apprehension. c. It restricts anonymity of ideas. d. It overcomes the problem of production blocking.

d

Identify an accurate feature of the strategic objective of an organization. a. It excludes a time frame. b. It is primarily developed by first-level managers. c. It specifies how the organization will use resources to accomplish specific goals. d. It must stretch and challenge the organization.

d

In the decision-making process, which of the following best defines the term maximizing? a. It refers to selecting the most efficient technique for evaluating comparisons. b. It refers to choosing the optimal decision criteria in decision making. c. It refers to selecting the best statistical method for making comparisons. d. It refers to choosing the best alternative course of action in decision making.

d

Benefits of Planning

intensified effort, persistence, direction, and creation of task strategies

2. Setting Company Objectives and Goals

is a more specific goal that unifies company-wide efforts, stretches and challenges the organization, and possesses a finish line and a time frame

operational plans

very short-term plans that specify what actions individuals, work groups, or departments need to accomplish in order to achieve the tactical plan and ultimately the strategic plan

persistence in planning

working hard towards following the plan

budgeting

quantitative planning through which managers decide how to allocate available money to best accomplish company goals

In the planning process, a(n) _____ lists the specific steps, people, resources, and time period for accomplishing a goal. a. vision statement b. code of ethics c. action plan d. budget

c

intensified efforts

putting forth great effort to following the paln

Strategic Planning Steps

1. Defining the Company's Mission 2. Setting Company Objectives 3. Designing the Business Portfolio 4. Implementing the Marketing Strategy

Delphi Technique steps

1. assemble a panel of experts 2. create a questionnaire consisting of a series of open-ended questions for the group. 3. the group members' written responses are analyzed, summarized, and fed back to the group for reactions until the members reach agreement. Asking group members why they agree or disagree is important because it helps uncover their unstated assumptions and beliefs.

management by objectives process

1. discuss possible goals (2) collectively select goals that are challenging, attainable, and consistent with the company's overall goals (3) jointly develop tactical plans that lead to the accomplishment of tactical goals and objectives (4) meet regularly to review progress toward accomplishment of those goals.

length of operational plans

30 days to 6 months

Jonathan is a manager at a departmental store. In recent weeks, the sale of goods in his store has decreased considerably. He does not know the reason behind this decline. As per the decision-making process, the next step that Jonathan must take is to: a. define the problem. b. evaluate each alternative. c. generate alternative courses of action. d. make absolute comparisons.

a

Karen, the sales manager of an appliance store, informs Jonah, one of her salespeople, that she expects him to sell $50,000 worth of merchandise by the end of the quarter. Every week, Jonah provides Karen with a report on his progress. In this scenario, Karen is using _____ to track Jonah's progress. a. performance feedback method b. slack resources c. a stock report d. an inventory analysis

a

Plushvier Inc. plans to launch its product in five regional markets. In order to maximize profit and reduce loss, initially, the company makes small investments in all five markets. The investments made are small so that if a particular market fails to perform, then the company can discontinue its investment in that market and invest in markets that produce good returns. In this case, Plushvier Inc. is using _____. a. options-based planning b. reverse planning c. transactional planning d. case-based planning

a

nominal group technique

a decision-making method that begins and ends by having group members quietly write down and evaluate ideas to be shared with the group

relative comparisons

a process in which each decision criterion is compared directly with every other criterion

absolute comparisons

a process in which each decision criterion is compared to a standard or ranked on its own merits

rational decision making

a systematic process of defining problems, evaluating alternatives, and choosing optimal solutions

Identify a true statement about the Delphi technique. a. It requires all members and experts to be in one place. b. It begins by assembling a panel of experts. c. It ends with a quiet time during which members vote for the preferred solution.

b

Identify a true statement about the nominal group technique. a. It produces better decisions than the devil's advocacy approach. b. It restricts c-type conflicts. c. It increases a-type conflicts. d. It is also known as electronic brainstorming.

b

In the context of conflicts, c-type conflict is a disagreement that focuses on _____. a. the physical proximity of group members b. issue-related differences of opinion c. the emotional reactions of individuals d. individuals or personal issues

b

Martha is a manager at Healier Life Inc. She drafts a list of specific goals that she wants her company to achieve by the end of the year. In the context of planning, the next step that Martha should take is to: a. calculate the time period required to achieve the goals. b. monitor the progress towards meeting the goals. c. develop commitment to those goals. d. identify the resources required to fulfill the goals. Hide Feedback

c

Supernova Inc. attempts to resolve a major technical issue in its database. To identify the best way to resolve the issue, the company assembles technical experts with different skill sets. The problem was explained to each of the experts and their individual opinions were collected, and a questionnaire based on the problem was given to each of them. The answers of all the experts were analyzed and then sent back to the experts for their final opinions. Identify the strategy that is being used by Supernova to generate solutions. a. The nominal group technique b. Devil's advocacy c. The Delphi technique d. Dialectical inquiry

c

_____ is a group decision-making method that begins and ends by having group members quietly write down and evaluate ideas to be shared with the group. a. The Delphi technique b. Dialectical inquiry c. The nominal group technique d. Face-to-face brainstorming

c

_____ is a process of weighing decision criteria in which each criterion is compared with a standard or ranked on its own merits. a. Satisficing comparisons b. Maximizing comparisons c. Absolute comparisons d. Relative comparisons

c

Top management is responsible for developing _____ that make clear how a company will serve customers and position itself against competitors in the next two to five years. a. tactical plans b. operational plans c. standing plans d. strategic plans

d

Planning and Direction

determination of intelligence requirements; development of appropriate intelligence architecture; preparation of collection plan; issuance of orders and requests to information collection agencies

standing plans

plans used repeatedly to handle frequently recurring events

There are three kinds of standing plans:

policies, procedures, and rules and regulations.

procedures

standing plans that indicate the specific steps that should be taken in response to a particular event

Strategic Planning

the process of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marketing opportunities

Creation of Task Strategies

thinking of better ways to get the job done

Delphi Technique

A decision-making technique in which group members do not meet face-to-face but respond in writing to questions posed by the group leader.

In the decision-making process, one of the rules of brainstorming is that: a. crazy and wild ideas are unacceptable. b. other group members' ideas should be used to come up with even more ideas. c. criticism or evaluation of ideas should be encouraged. d. the fewer the ideas, the better.

b

In the planning process, after developing goal commitment, a manager must: a. make the goal public. b. develop an effective action plan. c. maintain flexibility. d. track progress toward goal achievement.

b

Which of the following statements is true about an organization's purpose statement? a. It differs slightly from the organizational vision or mission. b. It states the company's reason for existing. c. It contains guidelines for day-to-day operations. d. It specifies how the organization will use resources to accomplish specific goals.

b

_____ is a decision-making method that creates c-type conflict by forcing decision makers state the assumptions of a proposed solution and generate a solution that is the opposite of that solution. a. Devil's advocacy b. Dialectical inquiry c. The Delphi technique d. The nominal group technique

b

identify a true statement about the planning process. a. Effective action plans precede the development of commitment in the planning process. b. The first step in the planning process is to track progress toward goal achievement. c. The final step in developing an effective plan is to maintain flexibility. d. The planning process ends with developing effective action plans.

c

Which of the following statements is true about the strategic objective of an organization? a. It is developed by first-level managers. b. It is ambiguous and fails to challenge the firm's potential. c. It is redundant and does not possess a finish line. d. It unifies companywide efforts.

d

_____ is a process of weighing decision criteria in which each criterion is compared with every other criterion. a. Satisficing comparisons b. Procedural comparisons c. Absolute comparisons d. Relative comparisons

d

strategic planning begins with the creation of a _____. a. code of ethics b. budget c. rules and regulations document d. purpose statement

d