Management- CH 3

Environmental Scanning

The first step managers use to make sense of their changing environments; precedes action steps such as downsizing, modifying budgets, or benchmarking

Simple Environment

a company in this environment would have few external factors in the environment that affect it

Punctuated Equilibrium theory

according to this theory companies often experience both stable and dynamic external environments; companies go through long, simple periods of environmental stability, followed by short, complex periods of dynamic, fundamental environmental change, finishing with a return to environmental stability. ex: US airline industry

Organizational Heroes

after an organization's founders are gone the organization uses this to sustain it organizational culture

Buyer Dependence

an increase in this can lead to opportunistic behavior in which one party benefits at the expense of another

Consumer Preferences

are an example of a trend in general behavior, an aspect of the socio-cultural environment.

Visible Artifacts

are signs of an organization's culture (e.g., company dress code). Changes in artifacts may be made in order to support the change process.

External Environments

are the forces and events outside a company that have the potential to influence or affect it.

Business Confidence Indices

are used by managers as predictors of future economic activity when making business decisions; economic statistics tend to be poor predictors of future business activity

Organizational Stories

are used to make sense of organizational events and changes and to emphasize culturally consistent assumptions, decisions, and actions.

General Environment

consists of the economy and the technological, socio-cultural, and political/legal trends that indirectly affect all organizations; indirectly influence organizations

Relationship Behavior

focuses on establishing long-term mutually beneficial relationships

Advocacy Groups

generally share the same point of view on a particular issue; three techniques used by this group are public communications, media advocacy and product boycotts; they cannot directly regulate organization practices

Political/legal Component

includes legislation, regulation, and court decisions that govern and regulate business behavior.

Industry Regulation

includes rules that govern business practices and procedures, including accessibility for disabled workers.

Company Founder

is a primary source of organizational culture

Competitive Analysis

is a process for monitoring the competition that involves identifying competitors, anticipating their moves, and determining their strengths and weaknesses. To understand competitive behavior, it is important that this company identify all of its likely competitors.

Dynamic Environment

is an environment in which the rate of change is fast; ex: video game maker bc it faces short product life and rapid changes in technology

Consistency

is defined as actively defining and teaching the organizational values, beliefs and attitudes.

Reactive Customer Monitoring

is defined as identifying and addressing customer trends and problems after they occur

Environmental Uncertainty

is defined as the extent to which managers can understand or predict which environmental changes will affect their businesses. Complexity and change make it more difficult for managers to achieve such understanding or make sound forecasts.

Adaptability

is the ability to notice and respond to changes in organizational environment.

Supplier Dependence

is the degree to which a company relies on a supplier because of the importance of the supplier's product to the company and the difficulty of finding other sources of that product.

Resource Scarcity

is the degree to which an organization's external environment has an abundance or lack of critical organizational resources.

Environmental Complexity

is the number of external factors in the environment that affect organizations.

Behavioral Substitution

is the process of having managers and employees perform new behaviors central to the new organizational culture in place of those behaviors that were central to the old organizational culture.

Specific Environment

is unique to each firm's industry and directly affects the way it conducts day-to-day business; directly affects the way a company conducts its business

Technological Components

knowledge, tools and techniques

Confidence Indexes

measure manager sentiment, which may yield a stronger prediction of near-term economic activity.

Opportunistic Behavior

one party benefits at the expense of another

Public Communications

os the least aggressive approach likely to be used by ay advocacy group

Behavioral Addition

refers to the process of having managers and employees perform new behaviors that are central to and symbolic of the new organizational culture that a company wants to create.

Environmental Change

refers to the rate at which a company's general and specific environments change.

Organizational Culture

refers to the set of key values, beliefs, and attitudes shared by organizational members; primary source is the company founder; characteristics: adaptability, consistency, involvement, a clear mission; very difficult to change and no intervention guarantees success

External Organizational Environments

two types: general environment and specific environment