chapter 6 organization and management
Which level of strategic management focuses on the organization as a whole?
corporate level
The president, chief financial officer, and chief operating officer of Jensen Mfg. meet annually to discuss the direction of the company including what products they will continue to offer and what new products they will introduce. Which level of strategic management does this represent?
corporate-level
When corporate departments such as marketing, human resources, and information technology implement plans of action that support higher-level strategies, they are following a(n) ______ strategy.
functional
one of the three strategy levels; plan of action by each functional area of the organization to support higher level strategies "how will you grow?"
functional-level strategy
One of three grand strategies, this strategy involves expansion—as in sales revenues, market share, number of employees, or number of customers or (for nonprofits) clients served
growth strategies
the use of strategic management techniques and processes is associated with ______________ small business performance
increased
When other companies cannot duplicate the value provided by a competitor, then the competitor has established a(n) ______ competitive advantage.
sustainable
Also known as a situational analysis, the search for the Strengths, Weaknesses, Opportunities, and Threats affecting the organization; helps asses the current reality
SWOT analysis
The "feedback loop" in the strategic-management process involves ______.
revising actions if necessary
One of three grand strategies, this strategy involves little or no significant change ex. company that makes the famous tabasco sauce, has only added seven flavors since it first started in 1868.
stability strategy
one of the five steps of the strategic management process; Monitoring performance to ensure that strategic plans are being implemented and taking corrective action as needed
strategic control
one of the five steps of the strategic management process; The implementation of strategic plans
strategic implementation
strategy that attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company
strategic position
Exists when other companies cannot duplicate the value delivered to customers
sustainable competitive advantage
True or false: According to Bossidy and Charan, execution is the central part of any company's strategy.
true
When would a company use a VRIO analysis?
when deciding whether or not a new product might work in the marketplace
Aligning people with goals, achieving promised results, and integrating strategy with reality are all part of the ______ process.
execution
True or false: It is common practice today for most small business owners to engage in strategic planning.
false
A vision or projection of the future
forecast
Strategic positioning attempts to achieve sustainable competitive advantage by ______.
preserving what is distinctive about a company
Strategic ______ involves monitoring the execution of strategy and taking corrective action when necessary. Multiple choice question.
control
What are the core processes of business identified by Bossidy and Charan? (Choose every correct answer.) 1. People 2. Competition 3. Operations 4. Strategy 5. Finance
1, 3, 4
Strategic position emerges from three sources: 1. _________ needs, _______ cutomers ex. crocs sells only shoes, but it provides them to all kinds of people 2. example: Buy Buy Baby sells clothing, strollers, and other items for babies 3. Allegiant Airlines is a low-cost travel company that not only offers flights across the United States, but also owns budget-friendly hotels.
1. few needs, many customers 2. broad needs, few customers 3. broad needs, many customers
A management strategy by which companies evaluate their strategic business units on the basis of (1) their business growth rates and (2) their share of the market
BCG matrix
What strategy is American Tile Corp. using when it acquires a company that makes industrial cleaning products that American Tile does not currently offer?
Diversification
Juanita feels it is important for her taxi company to continually measure itself against its best competition. She keeps track of the number of rides per hour and turnaround times for all her drivers and compares it to that of other high-performing taxi companies in the area. Juanita is using the process of ______ to compare her company with others.
benchmarking
A ______ is a vision or projection of the future that is made following a SWOT analysis.
forecast
Leonore's Luxury Leather Footwear Corp. conducts a SWOT analysis and determines that at least 57 percent of consumers demand high-end footwear, and, as a result, its sales should increase by 18 percent in the next year. This vision of what could happen is known as a ______.
forecast
the strategic-management process has five steps: 1. establish the __________, vision, and values statements 2. assess the current ____________ 3. formulate corporate, business, and ____________ strategies 4. _____________ implementation 5. maintain strategic ____________
mission; reality, functional; strategic, control
Environmental factors that the organization may exploit for competitive advantage
organizational opportunities
Why do potential employers value the skill of strategic thinking in job candidates? (Choose every correct answer.) 1. Strategic thinkers are globally-minded. 2. Strategic thinkers make for more informed employees. 3. Strategic thinkers are quick to recognize opportunities. 4. Strategic thinkers are focused on advancement opportunities.
1, 2, 3
Which of the following represent competitive forces used in Porter's model for industry analysis? (Choose every correct answer.) 1. Bargaining power of suppliers 2. Rivalry among competitors 3. Threats of new entrants 4. Training of new employees 5. Threat of substitute products or services 6. Failure of new entrants
1, 2, 3, 5
According to Bryan Barry, which of the following help a manager keep a strategic plan on track? (Choose every correct answer.) 1. Keep moving 2. Stay positive 3. Engage people 4. Stay focused 5. Mix it up 6. Keep it simple
1, 3, 4, 6
What are the goals of attending industry conferences before or while working in a certain industry? (Choose every correct answer.) 1. To make industry contacts 2. To collect more accomplishments for a resume 3. To gather intelligence on competitors 4. To learn about the specific industry
1, 4
What are Porter's four competitive strategies? 1. Cost-focus 2. Vertical integration 3. Related diversification 4. Focused-differentiation 5. Differentiation 6. Cost-leadership
1, 4, 5, 6
What does the BCG matrix evaluate? (Choose every correct answer.) Multiple select question. 1. Economies of scale 2. Market share 3. Business growth rates 4. Cost of goods sold
2, 3
Which Porter's competitive strategies are appropriate when addressing a narrow market? (Choose every correct answer.) 1. Diversification 2. Cost-focus 3. Focused-differentiation 4. Cost-leadership
2, 3
Refer to Figure 6.2. Place the steps in the strategic-management process in the correct order, with the first step listed at the top. Instructions 1. maintain strategic control 2. Assess the current reality 3. Formulate corporate, business, and functional strategies 4. Establish the mission, vision, and values statements 5. Execute the strategies
4, 2, 3, 5, 1
In addition to value, what characteristics are being addressed in a VRIO analysis? (Choose every correct answer.) 1. Replacement 2, Intent 3. Obsolescence 4. Organization 5. Imitability 6. Rarity
6, 5, 4
A process by which a company compares its performance with that of high-performing organizations
Benchmarking
Also known as scenario planning and scenario analysis; the creation of alternative hypothetical but equally likely future conditions
Contingency planning
Of the three core processes of business identified by Bossidy and Charan, which do they believe is the most important?
People
Also called four generic strategies; (1) cost leadership, (2) differentiation, (3) cost-focus, and (4) focused-differentiation. The first two strategies focus on wide markets, the last two on narrow markets
Porter's four competitive strategies
What are functional strategies used to accomplish?
Putting strategic plans into effect
A ______ analysis is an assessment of the strengths, weaknesses, opportunities, and threats affecting the organization.
SWOT
Which "unwritten" skill did the Harvard Business Review consider essential to being promoted on the job? Multiple choice question.
Strategic thinking
What does business growth rate refer to, as used in the BCG matrix?
The speed of industry growth
Is a framework for analyzing a resource of capability to determine its competitive strategic potential by answering four questions about its Value, Rarity, Imitability, and Organization
VRIO
Why do many executives prefer visioning to execution?
Visioning is more exciting than execution.
Mcdonalds's, Burger King, and Wendy's are constantly watching and _____________ against each other in order to maximize efficiency, cut costs, and increase profits. This has led to innovations in drive-thru configurations and ordering approaches.
benchmarking
The process by which a company compares its performance with that of other high-performing organizations is known as ______.
benchmarking
one of the three levels of strategy; focuses on individual business units or product/service lines "how will you compete?"
business-level strategy
Netflix has an uphill battle since their customers do not get charged if they leave and they can acquire competitor's services simply by downloading an app. This demonstrates the bargaining power of who?
buyers
the preceding four competitive forces influence the fifth force: rivalry among ___________
competitors
one of the three levels of strategy; Focuses on the organization as a whole senior levels referred to as the "C" Suite "what do you want to achieve"
corporate-level strategy
one of the five steps of the strategic management process; Assessment to look at where the organization stands and see what is working and what could be different so as to maximize efficiency and effectiveness in achieving the organization's mission
current reality assessment
Also called retrenchment strategy, one of three grand strategies, this strategy involves reduction in the organization's efforts
defensive strategy
Strategic thinkers should have a knowledge base shaped like the letter "T," where the top of the "T" represents breadth of knowledge and the stem of the "T" represents ______.
depth of expertise
Porter's five competitive forces form a model for ______ analysis.
industry
Grows market share or profits by innovating improvements in products or services ex. Lululemon expanding their men's clothes
innovation strategy
To be successful, strategic planning requires a company to have a ______ orientation.
long-term
Disney purchasing 21st century Fox is an example of?
related diversification
When a company purchases a new business that is related to the company's existing business portfolio
related diversification
Within a SWOT analysis, the letter "S" represents a company's ______.
strengths
What does SWOT stand for? HINT: each letter represents something
strengths, weaknesses, (internal) opportunities, threats (external)
Netflix has to ensure that customers continue to prefer its offerings to the many other options available (other streaming services but also traditional cable providers and satellite television) this is an example of threats of ___________ products or services
substitute
Luxury Linens Inc. produces the highest thread-count sheets available anywhere and does so at a price that none of its competitors can duplicate. It can be said that Luxury Linens has a(n) ______.
sustainable competitive advantage
Netflix switching from in-store and mail-order DVD rentals to online streaming, which lead to other networks (NBC, HBO, CBS) to do the same aftter seeing how successful netflix became is an example of what?
threats of new entrants
A hypothetical extension of a past series of events into the future
trend analysis
The drawbacks that hinder an organization in executing strategies in pursuit of its mission
organizational weaknesses
having obsolete technology, outdated facilities, and a shaky marketing operation are all examples of what?
organizational weaknesses
research has found that organizations that clearly articulate their values in their mission statement perform ____________.
better
having to deal with new regulations, a shortage of resources, and/or substitute products are all examples of what?
organizational threats
Amazon buying Whole Foods and CVS buying Aetna is called?
diversification
Strategy by which a company operates several businesses in order to spread the risk (grow revenue or reduce risk)
diversification
The strategy of moving into new lines of business is called ______.
diversification
A business that wants to reach more customers and hires more employees to get this done is focusing on a ______ strategy.
growth
A grand strategy that involves expansion of things like sales revenues, market share, or number of employees is known as a ______ strategy.
growth
three fundamental types of corporate strategies are: 1. g 2. s 3. d
growth; stability, and defensive
A system of shared beliefs and values that needs to be aligned with the goal of producing efficient, quality work is called ______ culture.
organizational
having weak rivals, emerging markets, and a booming economy are all examples of what?
organizational opportunities
The skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its mission
organizational strengths
having a skilled workforce, a superior reputation, strong financing are examples of what?
organizational strengths
Environmental factors that hinder an organization's achieving a competitive advantage
organizational threats
Model proposes that business-level strategies originate in five primary competitive forces in the firm's environment: (1) threats of new entrants, (2) bargaining power of suppliers, (3) bargaining power of buyers, (4) threats of substitute products or services, and (5) rivalry among competitors
porter's model for industry analysis
Netflix changes the movies and tv shows they offer, but may provide suppliers with higher power since there are limited companies producing media and entertainment content. Netflix found a solution in producing its own original content, demonstrating the _____________ power of suppliers
power
Michael Porter defined ______ as an attempt to achieve sustainable competitive advantage by preserving what is distinct about a company.
strategic positioning
The process of choosing among different strategies and altering them to best fit the organization's needs
strategy formulation
Occurs when a company acquires another company in a completely unrelated businesses
unrelated diversification
strategy is the creation of a unique and ____________ position strategy requires ________-off in competing strategy involves creating a "____" among activities
valuable, trade, fit
By Starbucks buying and roasting all its own coffee and then selling it through Starbucks stores, they are practicing what type of diversification strategy?
vertical integration
Diversification strategy where a firm expands into businesses that provide the supplies it needs to make its products or that distribute and sells its products
vertical integration