MANA 3335 Chapter 1,2,3,4 and 5

The international trade agreement that first incorporated the principle of most favored nation (MFN) status was the

General Agreement on Tariffs and Trade (GATT)

A small business starts an online store.

Growth of ecommerce

A business makes an app that processes financial transactions. The business owner decides to sell the app in another country where such apps are not currently in wide use. Which strategy is this business owner using?

Identifying a new market

Budgeting enough money for maintenance, marketing, and development of new products

Organizing

Having the potential to greatly increase profitability if it gains market share

Question marks

advisory board

consisting of experts recruited to help solve problems that are outside the entrepreneur's expertise

The Sarbanes-Oxley Act effectively writes ethical leadership into law because it requires CEOs and CFOs to

personally vouch for the truthfulness and fairness of their companies' financial disclosures

Donating money to a charity is an example of

philanthropic giving

Setting an organization's goals

planning

When middle- and lower-level managers develop______________

plans, they primarily discuss what their work groups will do in the short term.

When a strategy addresses the way in which an organization distributes money, people, and information to its different businesses, the strategy is guiding

resource deployment

Strategic alliances

in which another business helps fund the start-up because the new business will be useful in some way. For example, a tech company might help an app developer get started because the apps will greatly enhance the company's products.

Closely managing inventory to prevent interruptions to production

operations manager

The people with legal property rights to the organization are the

owners

Large businesses

small companies to provide parts and services in order to do business.

A more risky approach to entering a market is to

start a new business from scratch

The goals that are determined directly from the mission are the________________ goals.

strategic

Traditional lenders

such as banks, independent investors, and government agencies. To access these sources of funding, the entrepreneur must provide a formal business plan and often meet strict requirements.

Personal resources

such as the entrepreneur's own money or loans from friends and family

Operational plans are directly based on the

tactical plans and operational goals

Networking

whereby entrepreneurs form relationships with other businesspeople either independently or through organizations established to help people connect

Small-business investment companies (SBICs) and minority enterprise small-business investment companies (MESBICs)

which are federally licensed to borrow money from the Small Business Administration (SBA) and to invest it in or lend it to new ventures

Venture capital companies

which are groups of investors that provide capital in return for stock ownership and, often, some say over how the company is run.

SBA financial programs

which offer or facilitate a limited amount of funding to small businesses through a variety of mechanisms

management consultant

who provides expert advice, usually for a steep fee

start-up

Relatively new small businesses are called start-ups or new ventures. A new business may be poorly financed, be structured as a partnership, or use a first-mover strategy, but all these things can be true of long-established businesses as well.

Having a large share of a rapidly growing market

Stars

What are managers focusing on when they determine the organization's strategy?

Strategy formulation

Placing orders for materials

Technical skills

A department within an organization is

a subsystem within a system

A tax on goods that are shipped from one country to another is

a tariff

A written statement of the values and standards that guide the organization's actions is a

code of ethics

Which of the following are resources commonly provided by a franchiser to a franchisee? Check all that apply.

Financing Training Marketing strategy Low-cost supplies

Which of the following are examples of ethical issues in information technology? Check all that apply.

1. The need to have a corporate data privacy policy 2. The need to establish trust with customers by pledging to protect their private data

The chief impact officer, who is responsible for transforming the organization by developing strategy, is most likely a

top manager

1. Managers hire more employees and manage inventory and cash flow as demand increases. 2. Managers focus on stabilizing quality and reliable delivery of the product or service. 3. Organizations without a clearly differentiated product or that have not moved into higher-growth markets see a drop in profits.

1. Introduction 2. Growth 3. Decline

Small Business Administration

which offers a variety of advisory programs at little or no cost. One such program is the Service Corps of Retired Executives (SCORE), which matches retired executives who volunteer their time with entrepreneurs who need advice from experienced managers. Another program is the Small Business Institute, whereby business students earn college credit by helping small-business owners. In addition, the Small Business Development Center (SBDC) program creates centers that make management advice available at no or low cost.

Evidence-based management (EBM) is a rigorous process for making the best decisions possible. Here are five principles of EBM as proposed by Jeffrey Pfeffer and Robert I. Sutton:

•Build an organizational culture in which people feel it is safe to tell the truth, even when it's unpleasant.•Commit to using the best evidence available to guide decision making. •Encourage a spirit of experimentation, in which members of the organization feel comfortable trying things out to learn whether they work. •Critically examine recommendations for downsides. •Avoid relying on your opinions, your own organization's past practice, or the uncritical adoption of the practices of successful

Supervising a team of accountants

financial manager

state of certainty

the manager has a thorough understanding of the alternatives. A state of complete certainty is rare in the business world.

state of uncertainty

the manager knows neither all the alternatives, nor their associated risks, nor their likely outcomes. The risk of making a mistake is high in this condition. In today's highly dynamic business environment, a state of uncertainty dominates the decision-making landscape, especially for high-level managers setting strategy.

At action point 4

the organization has successfully carried out either its original plan or its contingency plan.

1. Understanding the organization's tactical goals 2. Evaluate progress in terms of the goal 3. Integrate the activities of different people and work groups

1. Develop the plan 2. Execute the plan 3. Execute the plan

Which of the following are steps in the decision-making process? Check all that apply.

1. Developing a plan to put the decision into effect 2. Identifying alternative courses of action 3. Choosing the alternative that is likely to be most effective

Which of the following are ways in which managers influence organizational culture? Check all that apply.

1. Shared experiences 2. Ceremonies 3. Stories

The table gives examples of different factors considered in a SWOT analysis. Identify whether each factor is a strength, weakness, opportunity, or threat. 1. Making products efficiently 2. Entry into the market of a new competitor 3. A poor location

1. Strength 2. Weakness 3. Threat

Which of the following are examples of information used in the art of management? Check all that apply.

1. Website articles on consumer trends 2. Conversations with industry experts

What is a contingency plan?

An alternative course of action developed when changed circumstances render the original plan obsolete

Having a large share of a stable market

Cash cows

Choosing to convey information in an email, a direct message, or a slide presentation based on the type of information and the audience

Communication skills

Forecasting correctly that certain world events will disrupt the company's relationships with suppliers and customers

Conceptual skills

Which of the following is the perspective that managers need to behave differently as appropriate for their organization's situation?

Contingency perspective

Creating an organizational culture that discourages stealing from the company

Controlling

After being downsized from a large retailer, a manager starts his own gift shop.

Crossover from large companies

Deciding to increase customer satisfaction by keeping prices low instead of by stocking more types of merchandise

Decision Making

Gathering the information needed and then setting departmental goals

Decision-making skills

Generating low or no profits and not deserving of investment

Dogs

Entrepreneurship and Small Businesses

Entrepreneurship and Small Businesses An entrepreneur- is someone who engages in entrepreneurship, which is the process of planning, organizing, operating, and assuming the risk of a start-up or new venture. A start-up or new venture- is a relatively new small business. A small business is privately owned by one individual or a small group and has revenues and assets that are not large enough to influence its environment.

Huab sees a number of busy small businesses in her neighborhood, so she thinks about starting her own business someday.

Improved chance of business survival

Realizing that a colleague is upset and talking to that person to soothe their feelings

Interpersonal skills

Meeting one-on-one with subordinates to discuss their strengths and opportunities for improvement

Leading

A candidate for divestiture

Loser

Which of the following is a downside of the widespread use of the quantitative management perspective?

Managers may perceive numbers as objective facts, but the results of quantitative analysis are only as good as the underlying assumptions.

The BCG Matrix guides corporations in managing their portfolio of businesses by rating businesses on which two dimensions?

Market growth and market share

Entrepreneurship

Much U.S. and global economic activity is generated by new companies founded by entrepreneurs. These companies are usually small when founded. Some successful small businesses stay small due to environmental constraints or because of their owner's preference, while others grow into large businesses.

An entrepreneur wants to join an association that helps like-minded business people meet each other and form relationships. What is the term for this kind of activity?

Networking

Frustrated at not being promoted despite her years of experience, a woman starts her own business.

Opportunities for underrepresented groups

Good competitive position but low industry attractiveness

Profit Producer

If multiple subsystems work better because they are designed to work together, what is happening?

Synergy

Which of the following are common reasons that new ventures fail? Check all that apply.

The entrepreneur lacks management expertise. The entrepreneur cannot put enough time into running the business. When new ventures do not succeed, failure is often due to one or more of the following factors: •Lack of management expertise •Lack of time •Lack of management control systems •Lack of capital

What is organizational culture?

The set of values, beliefs, behaviors, customs, and attitudes that define what the organization stands for, how it does things, and what it considers important

Which of the following describes operational goals?

These goals are set by lower-level managers, are specific in scope, and have short time frames.

Buy an existing business.

This is the lower-risk approach, because the entrepreneur can choose a business that already has a track record of success as well as a customer base, vendor relationships, or whatever else the business needs.

Unprogrammed decisions

are new and unstructured. In other words, it is not immediately clear what action should be taken. The manager must invest a great deal of capacity into understanding the situation and rely on intuition to make the decision. For example, as television executives decide how to handle the loss of market share to customers who prefer to stream shows via the internet, they are making a series of unstructured decisions, since this problem has never been solved before.

Crowdfunding

by which entrepreneurs solicit investors or lenders online

business plan

describes an entrepreneur's goals, strategies, and methods to implement those strategies. An entrepreneur writes a business plan to clarify their own thinking and to communicate to other stakeholders the goals for the business, the strategies that will be used to achieve those goals, and the way those strategies will be implemented. A sales forecast and a financial plan are usually components of the business plan, and a balance sheet is part of a financial plan.

A strategy is____________ when it aligns the organization with its environment and supports achievement of its goals.

effective

The people who work for the organization are the

employees

When a manager provides employees with resources and coordinates their activities, the manager is _______________ the plan

executing

A book which analyzes labor shortages in the early 1900s led to the development of ways to improve workers' performance is a book about

history and theory

Handling employee disciplinary actions, including termination policies

human resource manager

Decision making

is the act of choosing one alternative from among a set of alternatives. Includes several steps. 1. Recognizing and defining the nature of a decision situation. First, the manager needs to appreciate that a decision needs to be made. 2. Identifying alternatives. If there is only one possible course of action, then no decision needs to be made; the manager does the only thing that can be done. Almost always, however, there are multiple options. 3 .Choosing the most effective alternative. To make this judgment, the manager needs to have a clear definition of effectiveness as it applies to the situation. For example, in one situation, the most effective decision is one that minimizes costs, while in another situation, the most effective decision is one that maximizes market share. 4. Putting the decision into effect. The manager makes a plan to translate the decision into actions.

At action point 3

managers identify the signs that indicate a contingency event may be occurring, and they develop plans to reduce or avoid the risk. Then managers monitor the environment for these indicators. 1. Identify how managers will know a contingency event is occurring

Management science uses__________________ to aid in decision making and measuring results.

mathematical models

state of risk

the availability of each alternative and its pros and cons have associated probability estimates. For example, a corporate supplies buyer knows that buying a single laptop costs a certain amount, whereas buying at least 10 laptops gets a 20 percent discount but requires a much larger total expenditure. Based on experience, the buyer believes the company will probably (80 percent chance) need at least 10 laptops in the next few months and, therefore, spending the money for a bulk purchase to get the discount is worthwhile. However, if the buyer is mistaken (20 percent chance), the company will have tied up a lot of cash in laptops it doesn't need.

Why Some Start-ups Fail

• Lack of managerial expertise: Entrepreneurs may be talented at making the product or delivering the service they want to sell but ignorant of good business practices. • Lack of time: An entrepreneur may try to start a business while continuing to work at a full-time job, attending school full-time, or assuming full-time family responsibilities, but a start-up often demands all of its owner's time. • Lack of control: The control function of management alerts business owners to potential problems. If control systems are absent, an entrepreneur does not realize the business is in trouble before it is too late. • Lack of capital: Many entrepreneurs are overly optimistic about how soon the business will become profitable and do not have enough money to sustain the business and themselves until the enterprise gets established.

Which of the following are examples of new challenges managers face today? Check all that apply.

1. Making business decisions based on whether they will contribute to global climate change 2. Tracking and responding to bad reviews of their products on Facebook and Amazon

These are the steps in the rational decision-making process:

1. Recognize and define the decision situation. Based on a stimulus (some event or new information), realize a decision needs to be made. 2. Identify alternatives. The number of alternatives should rise in proportion with the importance of the decision. 3. Evaluate the alternatives. For each, consider how feasible it is, how well it's likely to address the problem or opportunity (how satisfactory it is), and what its consequences are likely to be. 4. Choose the best alternative, that is, the one most appropriate to the situation. 5. Implement the chosen alternative, working with other people or departments as needed. This step often involves an operational plan, as well as a contingency plan if things don't go as expected. 6. Evaluate the results. Perhaps the chosen alternative was the right one, or could work if implemented differently, or maybe a different alternative should be tried. In some cases, the manager will decide they were on the wrong track altogether and that the entire problem needs to be redefined.

Deserving of more investment

Winner

Many founders of start-ups choose not to borrow from ___________________ because they would be required to write up a thorough business plan and meet strict requirements.

a traditional lender

Managers should seek to maintain the organizational culture when________________ with the organizational environment.

the culture aligns well

Which of the following are arguments against businesses practicing social responsibility? Check all that apply.

1. The purpose of a business is to make a profit for its owners, not to solve social problems. 2. Businesses have enormous power already, and giving them control of social programs would give them even more power.

Which of the following are functions that goals serve in organizations? Check all that apply.

1. To help managers make effective plans 2. To motivate employees to achieve desired results 3. To help managers evaluate the organization's performance

franchising agreement

One way to purchase a business and get a great deal of support in running it is to sign a franchising agreement, a contract that allows the entrepreneur, or franchisee, to sell the product of the franchiser. The franchiser benefits when its franchisees are successful, so it provides them with assistance. This may take the form of a well-known brand, financing, equipment, training, low-cost supplies, a marketing strategy, and management advice. Disadvantages of being a franchisee include the high expense of purchasing the franchise, the limited control allowed by the franchiser, and potentially poor support from the franchiser.

Focusing on the most important task of the day, even when many less important tasks compete for attention

Time management skills

Why is it important for managers to study history?

To learn how and why managers and organizations have succeeded, failed, or changed what they did over time

Programmed decisions

are clearly structured and/or arise frequently. For example, if a call center has a rule that upset customers are to be transferred to a supervisor, when a representative realizes a customer is angry, he makes a programmed decision to transfer the customer.

Trends in Start-ups

•The rapid growth of e-commerce has opened many doors for entrepreneurs to find and create new markets as well as to serve existing markets in new ways. •Many new businesses are started by former employees of large companies. These individuals combine the experience and know-how gained from working at an established business with a passion for entrepreneurship. •People from underrepresented groups often decide that entrepreneurship offers more opportunities than working for another company. •Although starting a new business is still risky, the rate of failure has been decreasing, with about half of new ventures surviving at least five years.

For an organizational capability to be a distinctive competency, what needs to be true? Check all that apply.

1. The capability is possessed by only one or a few organizations. 2.The capability is a strength of the organization.

Start a new business.

This is the riskier approach, but it gives the entrepreneur the most latitude to shape the business to their exact specifications. To be successful, the founder must usually launch a product or service that people will pay for and cannot already buy. The entrepreneur must be able to answer the following questions: o Who are my customers? o Where are they? o At what price will they buy my product? o In what quantities will they buy? o Who are my competitors? o How will my product differ from those of my competitors?

Small businesses

tend to grow their workforces at a faster rate than large businesses do. For example, a company with one employee is more likely than a company with a hundred employees to double its workforce through hiring. In general, small businesses also shrink their workforces at a faster rate than do large businesses, since small businesses tend to have fewer resources to maintain employment through difficult times. When this effect is multiplied by the proportion of businesses that are small, it's clear that small organizations have a significant effect on U.S. employment. Small businesses are more likely to hire and fire at faster rates than large businesses are. A small business is more likely to be successful in the service or retail sector than in the manufacturing sector.

At action point 1

the organization is making its strategic, tactical, and operational plans, and managers consider possible contingencies. 1. Consider whether a political revolution could disrupt operations.

At action point 2

the organization puts its plans into place, and the highest-risk contingencies are defined. 1. identify a contingency event that is likely to occur

If an organization is following Porter's focus strategy, what should its managers decide to do?

Determine what a subset of customers desires and tailor a product to them.

Realizing that employees are not performing well because their training is inadequate

Diagnostic skills