MGT CH. 3
What is an internal environment?
Includes the elements within the organization's boundaries. This environment is composed of current employees, management, and especially corporate culture, which defines employee behavior in the internal environment and how well the organization will adapt to the external environment.
Who are the suppliers in a task environment?
Provide the raw materials the organization uses to produce its output.
What is the labor market in a task environment?
Represents the people available for hire by the organization.
What is culture?
The set of key values, beliefs, understandings, and norms shared by members of an organization.
What is a slogan?
a phrase or sentence that succinctly expresses a key corporate value. Many companies use this to convey special meaning to employee. Mission statements can also be used.
Who are the competitors in a task environment?
organizations within the same industry or type of business that vie for the same set of customers. (e.g. Target and Walmart are competing against online retailers such as Amazon and Zappos)
What are the 4 types of corporate culture?
1. Adaptability Culture 2. Achievement Culture 3. Involvement Culture 4. Consistency Culture
The internal environment includes what 4 things?
1. Corporate Culture (very important to competetive advantage) 2. Production Technology 3. Organization Structure 4. Physical Facilities
What is a story?
A narrative based on true events and is repeated frequently and shared among organizational employees. Stories paint pictures that help symbolize the firm's vision and values and help employees personalize and absorb them. (e.g. A frequently told story at UPS concerns an employee who, without authorization, ordered an extra Boeing 737 to ensure timely delivery of a load of Christmas packages that had been left behind in the holiday rush. As the story goes, rather than punishing the worker, UPS rewarded his initiative. By telling this story, UPS workers communicate that the company stands behind its commitment to worker autonomy and customer service)
What is an external organizational environment?
All elements existing outside the boundary of the organization that have the potential to affect the organization. The environment includes competitors, resources, technology, and economic conditions that influence the organization. It does not include those events so far removed from the organization that their impact is not perceived.
The external environment can be conceptualized into having two parts: the general and the task environment. Define task environment.
Closer to the organization and includes the sectors that conduct day-to-day transactions with the organization and directly influence its basic operations and performance. It is generally considered to include competitors, suppliers, customers, and the labor market.
What is a merger?
Companies to become involved in mergers or joint ventures to reduce environmental uncertainty. This type occurs when two or more organizations combine to become one.
What is a joint venture?
Companies to become involved in mergers or joint ventures to reduce environmental uncertainty. This type occurs when a strategic alliance or program is built by two or more organizations. (If you think it's join venture, its inter-oganizational)
What are cultural leaders?
Defines and uses signals and symbols to influence corporate culture and build a high performance culture. Cultural leaders influence culture in two key areas: 1. The cultural leader articulates a vision for the organizational culture that employees can believe in. The leader defines and communicates central values that employees believe in and will rally around. Values are tied to a clear and compelling mission, or core purpose.2. The cultural leader heeds the day-to-day activities that reinforce the cultural vision. The leader makes sure that work procedures and reward systems match and reinforce the values. Actions speak louder than words, so cultural leaders "walk their talk.
Who are the customers in a task environment?
Include people and organizations that acquire goods or services from the organization. They determine an organization's success.
What is the natural dimension of the general environment?
Includes all elements that occur naturally on Earth, including plants, animals, rocks, and resources such as air, water, and climate. Protection of the natural environment is emerging as a critical policy focus around the world. Governments are increasingly under pressure to explain their performance on pollution control and natural resource management.
What is the legal-political dimension of the general environment?
Includes government regulations at the local, state, and federal levels, as well as political activities designed to influence company behavior. The U.S. political system encourages capitalism, and the government tries not to over regulate business. However, government laws do specify rules of the game
What are inter-organizational partnerships?
Reduce boundaries and increase collaboration with other organizations. Companies may compete fiercely in one market yet collaborate greatly in another. (e.g. Apple and Samsung compete in customers and making the better phone, however they collaborated when apple wanted LCD screens built by samsung) (if you think its inter-organizational, its joint)
What is the socio-cultural dimension of the general environment?
Represents the demographic characteristics as well as the norms, customs, and values of the general population. Important sociocultural characteristics are geographical distribution and population density, age, and education levels. (e.g. Generation C has woven technology into every aspect of their lives.) (e.g. over half of the babies born in 2000 were minorities, how does a company adjust to target these different minorities?)
Why do organizations care so much about factors in the external environment?
The reason is that the environment creates uncertainty for organization managers, and they must respond by designing the organization to adapt to the environment.
What is Consistency culture?
uses an internal focus and a consistency orientation for a stable environment. Following the rules and being thrifty are valued, and the culture supports and rewards a methodical, rational, orderly way of doing things. In today's fast-changing world, few companies operate in a stable environment, and most managers are shifting toward cultures that are more flexible and in tune with changes in the environment
The external environment can be conceptualized into having two parts: the general and the task environment. Define general.
Affects organizations indirectly. It includes social, economic, legal-political, international, natural, and technological factors that influence all organizations about equally. Changes in federal regulations or an economic recession are part of the organization's general environment. These events do not directly change day-to-day operations, but they do affect all organizations eventually.
What is adaptability culture?
Emerges in an environment that requires fast response and highrisk decision making. Managers encourage values that support the company's ability to rapidly detect, interpret, and translate signals from the environment into new behaviors. Employees have the autonomy to make decisions and act freely to meet new needs, and responsiveness to customers is highly valued. Managers also actively create change by encouraging and rewarding creativity, experimentation, and risk taking
What is achievement culture?
Suited to organizations concerned with serving specific customers in the external environment, but without the intense need for flexibility and rapid change. This results-oriented culture values competitiveness, aggressiveness, personal initiative, cost cutting, and willingness to work long and hard to achieve results. An emphasis on winning and achieving specific ambitious goals is the glue that holds the organization together.
What are strategic issues?
When managers continuously scan the business horizon for both subtle and dramatic environmental changes, and identify those that require strategic responses. Events or forces either inside or outside an organization that are likely to alter its ability to achieve its objectives." As environmental turbulence increases, strategic issues emerge more frequently. Managers use several strategies to adapt to these strategic issues, including boundary-spanning roles, inter-organizational partnerships, and mergers or joint ventures.
What are Boundary-Spanning roles?
link to and coordinate the organization with key elements in the external environment. They serve two purposes for the organization: They detect and process information about changes in the environment, and they represent the organization's interests to the environment. (e.g. the use of business intelligence, which results from using sophisticated software to search through large amounts of internal and external data to spot patterns, trends, and relationships that might be significant. For example, Verizon uses business intelligence software to monitor customer interactions and fix problems almost immediately)
What to levels can culture be analyzed at?
1. Visible Artifacts - such as dress, office layout, symbols, slogans, and ceremonies 2. Invisible - Values & Beliefs
What is a symbol?
An object, act, or event that conveys meaning to others. (e.g a manager inherited a broken down company and needed to fix it. The dirty broken chairs were a symbol of the broken company. The manager bought brand new quality chairs as a symbol of new beginnings and a better quality company)
What is involvement culture?
Emphasizes an internal focus on the involvement and participation of employees to adapt rapidly to changing needs from the environment. This culture places high value on meeting the needs of employees, and the organization may be characterized by a caring, family-like atmosphere. Managers emphasize values such as cooperation, consideration of both employees and customers, and avoiding status differences. Consider the Four Seasons hotel chain, where the culture embodies a commitment to the company's greatest asset—its employees.
What is a high performance culture?
Emphasizes both cultural values and business results.
What is the technological dimension of the general environment?
Includes scientific and technological advancements in a specific industry, as well as in society at large. (more technology, more efficient, less employees) (e.g. Barnes & Noble is reinventing its traditional bookstore image with a new digital strategy that managers hope will help it compete with rivals Amazon, Apple, and Google on the digital book front. With its renewed focus as a seller of downloads, reading devices, and apps, and a market share of 27 percent of the e-book market, Barnes & Noble is using its brick-and-mortar bookstores to introduce customers to its Nook e-readers and build e-book audiences.)
What are the 6 dimensions of a general environment?
International technological socio-cultural economic legal-political natural.
What is the economic dimension of the general environment?
Represents the general economic health of the country or region in which the organization operates. Consumer purchasing power, the unemployment rate, and interest rates are part of an this environment. (e.g. many industries such as banking are finding it hard to make a comeback after a slow rebounding economy)
What is an organizational ecosystem?
What organizations are now evolving into. A system formed by the interaction among a community of organizations in the environment. An ecosystem includes organizations in all the sectors of the task and general environments that provide the resource and information transactions, flows, and linkages necessary for an organization to thrive. (e.g. Apple's ecosystem includes hundreds of suppliers and millions of customers for the products that it produces across several industries, including consumer electronics, Internet services, mobile phones, personal computers, and entertainment.)
What is the international dimension of the general environment?
When managers plan to expand globally. Includes events originating in foreign countries, as well as new opportunities for U.S. companies in other countries. This environment provides new competitors, customers, and suppliers and shapes social, technological, and economic trends as well.
What is a hero?
a figure who exemplifies the deeds, character, and attributes of a strong culture. They are role models for employees to follow. Heroes with strong legacies may continue to influence a culture even after they are gone. (e.g. Steve Jobs)
What is a ceremony?
a planned activity at a special event that is conducted for the benefit of an audience. Managers hold this to provide dramatic examples of company values. These are special occasions that reinforce valued accomplishments, create a bond among people by allowing them to share an important event, and anoint and celebrate heroes.
