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According to Porter, organizations cannot simultaneously pursue both a low-cost strategy and a differentiation strategy. Illustrate why. Show how exceptions to this "rule" can be found, and give an example to demonstrate the point.
According to Porter's theory, managers cannot simultaneously pursue both a low-cost strategy and a differentiation strategy. Porter believed that differentiation always raises costs and thus requires premium pricing to recover those costs. However, organizations with extremely efficient production systems (such as Toyota) have been able to pursue both strategies simultaneously by keeping costs down while providing a superior design and quality product.
Identify and briefly define the three major types of managerial skills.
Conceptual skills-The ability to analyze and diagnose a situation and distinguish between cause and effect. Human skills-The ability to understand, alter, lead, and control the behavior of other individuals and groups. Technical skills-The job-specific knowledge and techniques required to perform an organizational role.
Explain briefly the role of a distributor. If distributors become powerful, what will be its impact on an organization?If distributors become so large and powerful that they can control customers' access to a goods and services, they can threaten the organization by demanding that it reduce the prices of its goods and services
Distributors-Organizations that help other organizations sell their goods or services to customers
What do economic forces include? How do they affect the general environment of the organization? What are the challenges that they present to managers?
Economic Forces Interest rates, inflation, unemployment, economic growth, and other factors that affect the general health and well-being of a nation or the regional economy of an organization
The barriers to entry results from three sources. Explain in brief the three sources
Economies of scale-Cost advantages associated with large operations Brand loyalty-Customers' preference for the products of organizations currently existing in the task environment Government regulations
Define the concept of emotional intelligence. How does having emotional intelligence help managers?
Emotional Intelligence-The ability to understand and manage one's own moods and emotions and the moods and emotions of other people. Helps managers carry out their interpersonal roles of figurehead, leader, and liaison
Discuss the results of globalization.
Globalization-the set of specific and general forces that work together to integrate and connect economic, political, and social systems across countries, cultures, or geographical regions so that nations become increasingly interdependent and similar
Define groupthink. Explain a technique that counteracts groupthink.
Groupthink A pattern of faulty and biased decision making that occurs in groups whose members strive for agreement among themselves at the expense of accurately assessing information relevant to a decision Nominal Group Technique A decision-making technique in which group members write down ideas and solutions, read their suggestions to the whole group, and discuss and then rank the alternatives
Hofstede's model of national culture states five dimensions along which national cultures can be placed. Select any two of these five dimensions and discuss how each of these dimensions creates a different type of climate in which an organization can do business.
Individualism A worldview that values individual freedom and self-expression and adherence to the principle that people should be judged by their individual achievements rather than by their social background Collectivism A worldview that values subordination of the individual to the goals of the group and adherence to the principle that people should be judged by their contribution to the group Power Distance The degree to which societies accept the idea that inequalities in the power and well-being of their citizens are due to differences in individuals' physical and intellectual capabilities and heritage Achievement orientations worldview that values assertiveness, performance, success, and competition Nurturing orientation worldview that values quality of life, warm personal friendships, and services and care for the weak Uncertainty Avoidance degree to which societies are willing to tolerate uncertainty and risk Long-Term orientation worldview that values thrift and persistence in achieving goals Short-term orientation worldview that values personal stability or happiness and living for the present
Distinguish between internal and external locus of control.
Internal locus of control-Tendency to locate responsibility for one's fate within oneself. External locus of control-Tendency to locate responsibility for one's own fate in outside forces and to believe that one's own behavior has little impact on outcomes
What is intuition? Give an example to support your definition. Should managers use intuition in decision making? Why or why not?
Intuition feelings, beliefs, and hunches that come readily to mind, require little effort and information gathering and result in on-the-spot decisions
Business plans differ in the time horizons that they cover. Discuss the three major types of business plans in terms of their intended duration and explain why all three of these types of plans are important to a business.
Long-term plans have time horizons of 5 years or more, while short-term plans have horizons of 1 year or less. In general, corporate- and business-level plans involve long- and intermediate-term horizons, while short-term horizons are most appropriate for functional plans. Time Horizon The intended duration of a plan. Long-term plans are usually 5 years or more. Intermediate-term plans are 1 to 5 years. Short-term plans are less than 1 year. According to Porter, organizations cannot simult
Explain why customers are considered to be the most critical stakeholder group.
Most critical stakeholder. Company must work to increase efficiency and effectiveness in order to create loyal customers and attract new ones. Without customers the company cannot survive so in almost all situations the customer needs have to come first. The customer can always to choose to take his business to a competitor so it is essential that we continue to innovate, to offer good products and good value for money.
Psychologist David McClelland has extensively researched the needs for achievement, affiliation, and power. Define these needs.
Need for Achievement-The extent to which an individual has a strong desire to perform challenging tasks well and to meet personal standards for excellence Need for Affiliation-The extent to which an individual is concerned about establishing and maintaining good interpersonal relations, being liked, and having other people get along Need for Power-The extent to which an individual desires to control or influence others
What is organizational culture?
Organizational Culture-Shared set of beliefs, expectations, values, norms, and work routines that influence how members of an organization relate to one another and cooperate to achieve organizational goals
What is organizational performance and what is its relationship with efficiency and effectiveness?
Organizational Performance-A measure of how efficiently and effectively managers use organizational resources to satisfy customers and achieve organizational goals Efficiency-A measure of how well or productively resources are used to achieve a goal Effectiveness-A measure of the appropriateness of the goals an organization is pursuing and the degree to which the organization achieves those goals.
What is socialization? How does it help an organization?
Organizational socialization-process by which newcomer's learn an organization's values and norms and acquire the work behaviors necessary to perform jobs effectively
Define personality traits. What are the Big Five personality traits?
Personality Traits-Enduring tendencies to feel, think, and act in certain ways that can be used to describe the personality of every individual. Managers' personalities influence their behavior and approach to managing people and resources. Extraversion-tendency to experience positive emotions and moods and feel good about oneself and the rest of the world Negative affectivity-tendency to experience negative emotions and moods, feel distressed, and be critical of oneself and others Agreeableness-tendency to get along well with others Conscientiousness-tendency to be careful, scrupulous, and persevering Openness to Experience-tendency to be original, have broad interests, be open to a wide range of stimuli, be daring and take risks
Give the four major reasons why planning is important.
Planning is necessary to give the organization a sense of direction and purpose Planning is a useful way of getting managers to participate in decision making about the appropriate goals and strategies for an organization A plan helps coordinate managers of the different functions and divisions of an organization to ensure that they all pull in the same direction and work to achieve its desired future state A plan can be used as a device for controlling managers within an organization
With reference to Hofstede's model of national culture, explain power distance.
Power Distance The degree to which societies accept the idea that inequalities in the power and well-being of their citizens are due to differences in individuals' physical and intellectual capabilities and heritage
Compare and contrast programmed and non-programmed decision-making in organizations.
Programmed Decision Routine, virtually automatic decision making that follows established rules or guidelines. Non-Programmed Decisions Nonroutine decision making that occurs in response to unusual, unpredictable opportunities and threats.
What is restructuring and what are its disadvantages?
Restructuring : downsizing an organizaton by eliminatng The jobs of large numbers of Top, middle, or FrsT line managers and non-managerial employees Disadvantages : Reduce The morale of remaining employees, who worry abouT Their own job securiTy. Sometmes The downsize was Too far when employees complain They are overworked and when increasing numbers of cusTomer complain abouT poor service.
Describe the major provisions of Title VII of the Civil Rights Act of 1964, the Equal Pay Act, and the Americans with Disabilities Act.
Some of the major equal employment opportunity legislation that prohibits discrimination among diverse groups are: • Title VII of the Civil Rights Act of 1964 prohibits discrimination in employment decisions on the basis of race, religion, sex, color, or national origin. Decisions include hiring, Fring, pay, promotion, and working conditions. • The Equal Pay Act requires men and women to be paid equally if they are performing equal work. • The Americans with Disabilities Act prohibits discrimination against disabled individuals in employment decisions and requires employers to make accommodations for disabled workers to enable them to perform their jobs.
Define stakeholders. List at least four types of stakeholders.
Stakeholders-The people and groups that supply a company with its productive resources and so have a claim on and a stake in the company
Explain the following terms: strategy, low-cost strategy, and differentiation strategy
Strategy-cluster of decisions about what goals to pursue, what actions to take, and how to use resources to achieve goals. Low-Cost Strategy-Driving the organization's total costs down below the total costs of rivals Differentiation-Distinguishing an organization's products from the products of competitors on dimensions such as product design, quality, or after-sales service
Identify the advantages and disadvantages of group decision making.
Superior to individual making Choices less likely to fall victim to bias Able to draw on combined skills of group members Improve ability to generate feasible alternatives Allows managers to process more information Managers affected by decisions agree to cooperate Groupthink A pattern of faulty and biased decision making that occurs in groups whose members strive for agreement among themselves at the expense of accurately assessing information relevant to a decision
Explain briefly a task environment. What effect does it have on managers.
Task Environment-Set of forces and conditions that originate with suppliers, distributors, customers, and competitors and affect an organization's ability to obtain inputs and dispose of its outputs because they influence managers daily. Suppliers-Individuals and organizations that provide an organization with the input resources that it needs to produce goods and services Distributors-Organizations that help other organizations sell their goods or services to customers Customers-Individuals and groups that buy the goods and services that an organization produces Competitors-Organizations that produce goods and services that are similar to a particular organization's goods and services
Differentiate between terminal and instrumental values. How do they contribute to the organizational culture?
Terminal Values A lifelong goal or objective that an individual seeks to achieve Instrumental Values A mode of conduct that an individual seeks to follow Terminal values signify what an organization and its employees are trying to accomplish Instrumental values guide the ways in which the organization and its members achieve organizational goals
What are the two types of personal values? Explain.
Terminal Values A lifelong goal or objective that an individual seeks to achieve Instrumental Values A mode of conduct that an individual seeks to follow Terminal values signify what an organization and its employees are trying to accomplish Instrumental values guide the ways in which the organization and its members achieve organizational goals
Summarize the reasons why managers should behave ethically.
The relentless pursuit of self-interest can lead to a collective disaster when one or more people start to profit from being unethical because this encourages other people to act in the same way. Trust-Willingness of one person or group to have faith or confidence in another person's goodwill, even though this puts them at risk. Reputation-Esteem or high repute that individuals or organizations gain when they behave ethically.
Describe the four ethical rules or principles and discuss their managerial implications
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Identify and describe the sources of an organization's code of ethics.
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In general, business planning involves three distinct steps. Discuss these three steps.
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Discuss the assumptions that underlie the classical model of decision-making.
check picture. A prescriptive model of decision making that assumes the decision maker can identify and evaluate all possible alternatives and their consequences and rationally choose the most appropriate course of action