Unit 2 -MGT

Strategic position emerges from three sources:

(1) few needs, many customers; (2) broad needs, few customers; and (3) broad needs, many customers

3 types of corporate strategies

1. Growth 2. Stability 3. Renewal

Heuristics are strategies that ______ the process of making decisions.

Simplify

A _____ is a choice made from available alternatives.

decision

is strategic long or short term goals

long term, 1-5 years

is operational long or short term goals

short, 1-52 weeks

is tactical long or short term goals

short, 6-24 months

Philip, a shift manager in a factory, has 40 employees on his shift that he directly supervises. The 40 workers who report directly to Philip represent his

span of control

A _____ is a narrative about the company's history that is repeated by an organization's members in order to emphasize a particular value.

story

Porter's Five Forces

threat of entry, threat of substitute, supplier power, buyer power, and competitive rivalry

In terms of a SWOT analysis, organizational _____ are environmental factors that hinder an organization from achieving a competitive advantage

threats

Within a SWOT analysis, the letter "T" represents a company's _____

threats

Decision-making styles vary along two dimensions. What are those two dimensions?

tolerance for ambiguity and value orientation

One method of changing organizational culture is to provide structured _____ as an in-depth introduction to organizational values.

training

Which of the following represent learning-related tools that can be leveraged to change an organization's culture?

training role modeling coaching

When managers and employees within the same department are brought together in cross-functional teams to solve particular problems, their company is using a team-based design.

true

_________ reflects the extent to which a person focuses on either task and technical concerns or people and social concerns when making decisions

value orientation

The chain of command is also known as the

vertical hierarchy

An organization's vision statement states _____. For example, the Cleveland Clinic's vision statements says that it "strives to be the world's leader in patient experience, clinical outcomes, research, and education."

what the company wants to become, where it wants to go strategically

True or false: Many small business owners do not engage in strategic planning.

when deciding whether or not a new product might work in the marketplace

Which of the following are true regarding the second stage in the rational model of decision making?

- Creativity precedes innovation and has been described as the source of all intellectual property. - Once you have identified a problem or an opportunity and diagnosed its causes, you need to come up with both obvious and creative alternative solutions.

Which of these are reasons for chief executive officers (CEOs) getting increasingly ousted for ethical violations in the 21st century?

- Globalization allows businesses to operate in regions where ethical risks are greater. - Digital communications are more susceptible to hackers and whistleblowers. - The 24/7 news cycle places more scrutiny on unethical behavior.

Which of these assumptions are made in the rational model of decision making?

- Managers will always select the course of action that they know will most benefit the organization. - Managers have complete, error-free information about alternative courses of action and their consequences. - Managers are able to make logical decisions without prejudice or emotional blind spots.

porter four competitive strategies

- cost leadership - differentiation - cost focus - focused differentiation

strategic positioning

- created by michael porter - achieve sustainable competitive advantage by preserving what is distinctive about a company

four steps of a proactive learner

- initiative and rely on yourself - realistic goals - solutions > problems - professional convo

steps of planning/control

- make the plan - carry out the plan - control the direction by comparing results - control the direction by correcting

3 principles for strat positioning

- strategy is creation of a unique and valuable position - strategy requires trade off in competing - strategy involves creating a fit among activities

Which of the following represent competitive forces used in Porter's model for industry analysis?

-threats of new entrants -rivalry among competitors -threat of substitute products or services -bargaining power of buyers -bargaining power of suppliers

Which of the following are outcomes associated with various types of organizational culture? (select all that apply)

1,more positive work attitudes in clan cultures 2.more positive organizational outcomes in market cultures 3.higher customer satisfaction in clan and market cultures 4.higher financial performance in market and hierarchy cultures 5.higher market share in clan and market cultures

Strategic Management process (5 steps)

1. Establish the mission and the vision 2. Assess the current reality 3. Formulate the grand strategy 4. Implement the strategy 5. Maintain strategic control

Which of the following statements regarding the horizontal design are true? (select all that apply)

1.internal boundaries are broken down 2.workgroups are used to improve collaboration 3.this design is also called a team-based design

Value Statement

A brief articulation of the principles that guide a company's decisions and behaviors

What is the most accurate description of person-organization fit?

A match between an individual's personality and values and those of the organization

What is the second step in the strategic-management process?

Assess the current reality

Turbine Manufacturing uses artificial intelligence in its factories to automate basic tasks, freeing human employees to perform more high-level finishing and quality assurance tasks. Which area of artificial intelligence does this illustrate?

Assisted intelligence

Which of these would be considered observable artifacts in an organization? (select all that apply)

Awards Rituals Decorations

Successful implementation of major decisions requires which of the following?

Careful planning Sensitivity to those affected by the decision

what kind of stragety -involves senior executives in planning -answers questions such as "what business are we in?" and "what products and services shall we offer?" -focuses on the organization as a whole

Corporate-level strategy

What are Porter's four competitive strategies?

Cost-focus Cost-leadership Differentiation Focused-differentiation

What is the main difference between critical thinking and the moment-to-moment thinking that we use in our everyday lives?

Critical thinking requires deliberate mental processes, whereas moment-to-moment thinking is automatic and prone to bias.

According to Kahneman, which of the following characteristics describe System 2 thinking?

Deliberate Conscious Analytical

_____ is the tendency of the parts of an organization to disperse and fragment.

Differentiation

Consulting firm Accenture predicts that by 2035 artificial intelligence will have which economic effect?

Economic growth will double.

What is the most valuable competitive resource for a manager who needs alternative solutions to a problem?

Employees with ideas

What is the third stage of the rational model of decision making?

Evaluate alternatives and select a solution.

_____ is the process that helps align the last two phases of the strategic-management process: strategic implementation and strategic control.

Execution

_____ embed preferred culture by describing organizational philosophy, mission, vision, and values.

Formal statements

___ are strategies such as "rules of thumb" that simplify decision making.

Heuristics

Match the dimensions of the competing values framework (CVF) with their descriptions.

Horizontal-Expresses the extent to which the organization focuses its attention and efforts inward on internal dynamics and employees versus outward toward its external environment and customers. Vertical-Expresses the extent to which an organization prefers flexibility and discretion versus stability and control.

What is the best way to develop a ready-made solution?

Identify best practices and turn them into standard operating procedure.

Which of the following questions would you use to evaluate alternatives in the third stage of the rational model of decision making?

Is it ethical? Is it ultimately effective? Is it feasible?

Which of these describe how knowledge of decision-making styles affects managers' work?

It allows managers to better identify personal strengths and weaknesses. It gives managers an understanding of how different people reach different conclusions.

Knowledge of decision-making styles can assist managers in many ways except for which one of the following

It increases the biases of the managers toward their favorite style.

According to Bryan Barry, which of these are things a manager can do to keep a strategic plan on track?

Keep moving Engage people Stay focused Keep it simple

Which models are characteristic nonrational models of decision making?

Models that describe how managers actually make decisions

_____________ are difficulties that inhibit the achievement of goals.

Problems

Evidence-based management attempts to introduce which factor into the decision-making process?

Rationality

Dave and his partner are studying the strengths and weaknesses of their construction business, Ajax Construction, as well as researching the opportunities and threats in the external environment. Dave and his partner are conducting a

SWOT analysis

Which of the following function as the first stage in rational decision making by managers?

Sales shortfalls Poor product quality Customer complaints

What data is included in big data?

Social network communications, data in corporate databases, web-browsing data trails, surveillance data

What occurs as a result of the horizontal organizational design?

Teams are used to improve collaboration and work

Value orientation reflects the extent to which an individual focuses on which of the following dimensions?

Technical concerns or social concerns

Which of the following is an accurate description of decision making?

The process of identifying and choosing alternative courses of action

Which model of decision making explains how managers should use logic to determine the optimal means of furthering the organization's best interests?

The rational model

You own a small deli near campus and learn that the university is exploring whether it should open a Subway sandwich franchise in the Student Union. Which of Porter's competitive forces does this represent for you?

Threat of new entrants

Sasha has run a small diner near the train station for the past ten years. Six months ago, a chain restaurant serving gourmet burgers and sandwiches opened up near him and he has had to re-think his menu. He added some specialty sandwiches and free fries with every burger in order to retain his customers. Which of Porter's five competitive forces has affected Sasha's business?

Threats of new entrants

Which of these are examples of business analytics?

Time-series forecast Portfolio analysis

What does VRIO stand for? How is VRIO used?

Value rarity imitability organization asses competitive potential

Identify the three types of structures categorized as organizational designs with open boundaries. Check all that apply.

Virtual Hollow Modular

Which questions should you ask when developing ready-made solutions based on past experiences?

What was the problem? What lessons can you derive from this experience? What was the solution?

What are the two types of information that organization charts reveal about organizational structure?

Who specializes in what work Who reports to whom

a

a

According to Barnard's definition, which of the following examples represent organizations? (select all that apply)

a crew of two people coordinating their activities on a commercial tuna fishing boat the BumbleBee or StarKist tuna companies with their thousands of employees

_______ is the arrangement of having discrete parts of a task done by different people.

a division of labor

What are three characteristics of an organization with a simple structure?

a flat hierarchy,low work specialization,authority in a single person

________ is a control mechanism for making sure the right people do the right things at the right time.

a hierarchy of authority

Benchmarking is defined as

a process by which a company compares its performance with that of high-performing organizations.

Mission Statement

a statement of the organization's purpose - what it wants to accomplish in the larger environment

A forecast is defined as

a vision or projection of the future.

Sophisticated forms of business data analysis are known as business _______

analytics

An ____ artificial intelligence system learns from human inputs in order to assist humans in making better decisions.

augmented

People with a behavioral decision making style are more likely to:

avoid conflict have a hard time saying no

What are two suggestions for improving your adaptability in the workplace?

be more resourceful be proactive in learning situations

The process by which a company compares its performance with that of other high-performing organizations is known as _______.

benchmarking

Stores of data that are so large or complex that it is difficult to process them using traditional data base management applications are known as ___

big data

A(n) _____ organization is a fluid, highly adaptive organization whose members are linked by information technology and collaborate on common tasks.

boundaryless

focused differentiation strategy

build competitive advantage by being unique/superior in its industry. and to target a narrow market

differentiation strategy

build competitive advantage by being unique/superior in its industry. and to target a wide market

Which one of the following best describes the decisions made by a person with an analytical style?

carefully considers lots of information and alternatives

Rites and rituals, which are activities and _____ used to celebrate important organizational events or achievements, can be leveraged in the process of culture change.

ceremonies

Research shows that employees have more positive work attitudes in organizations with a(n) _____ culture.

clan

_______ involves gathering information about your competitors' activities so that you can anticipate their moves and react appropriately. For example, you may attend a trade show to learn what types of new products and new iPhone apps your competitors are planning to launch in the next six months.

competitive intelligence

Which decision-making style is characterized by a high tolerance for ambiguity and the consideration of many options together with a willingness to take risks?

conceptual

The process of fitting the organization to its environment is referred to as the _______ approach to organizational structure.

contingency

While Kirsten would have liked to ship all of the products at once, export fees limited her to shipping product out in small batches. Kirsten has fit her organization into the structure of the environment she uses for shipping. This is an example of _____ design.

contingency

Strategic _____ involves monitoring the execution of strategy and taking corrective action when necessary.

control

Levels of Strategy

corporate, business, functional

Which level of strategic management focuses on the organization as a whole?

corporate-level

Which of Porter's competitive strategies are appropriate when addressing a narrow market?

cost focus focused-differentiation

Organizational design is concerned with which two activities?

creating a structural design that will help an organization execute its strategies creating structures of accountability and responsibility

A system of shared beliefs and values that develops within an organization and guides the behavior of its members is called organizational ____

culture

A system of shared beliefs and values that develops within an organization and guides the behavior of its members is called organizational ______.

culture

A graph of decisions and their possible consequences used to create a plan is known as a(n) _____

decision tree

People with the ______ style of decision making are action-oriented and like to focus on facts. They also tend to be autocratic-type managers.

directive

people with a(n) _______ decision-making style have a low tolerance for ambiguity and are task oriented. They are efficient, logical, and practical in their approach to solving problems and making decision. Which style do they use?

directive

The strategy of moving into new lines of business is called _____.

diversification

Greg, the CEO of Organic Market, wants managers and employees to instruct each other about the organization's chosen values and beliefs. Greg has encouraged the seasoned employees to retell stories about the company legends, and he plans on bringing back the monthly rewards. Greg is endeavoring to

embed company culture

Formal statements can help to change an organization's culture by

embedding the culture in various organizational materials such as the mission, vision, and values statements.

What are the four activities for developing strategic thinking identified in the text?

engage in lateral thinking broaden task and functional knowledge set aside time to reflect understand the business

Business growth rate, as used in the BCG matrix, is concerned with how fast the _____ is(are) growing.

entire industry

Espoused values are

explicitly stated values and norms preferred by an organization

Vision Statement

expresses what the organization should become, where it wants to go strategically

According to Chester I. Barnard, an organization is made up of at least one person who strives daily to achieve the organization's goals.

false

An offensive strategy is a grand strategy that involves reduction in the organization's efforts. For example, some large publishers are no longer publishing children's books because they are too expensive to produce and distribute, and because the profit margins are too low to justify the investment.

false

In an organic organization, tasks and rules are clearly specified.

false

Marla, an employee for a government defense contractor, likes the strict culture that she finds with AeroDyno Industries, which supplies equipment parts to several military bases. There is very little focus on the external environment and little company flexibility due to the type of customers that AeroDyno serves. Because the product it sells needs little improvement and there is virtually no competition, AeroDyno Industries takes few risks. AeroDyno Industries is an example of an adhocracy culture.

false

Organizational culture appears as five layers: observable artifacts, espoused values, basic assumptions, informal groups, and management groups.

false

Several studies found that strategic planning does not benefit smaller companies, as they very seldom see improvements in financial performance from this type of planning.

false

Strategic positioning involves performing the same activities as rivals in a similar way, but at a lower cost.

false

The IT network that allows for the movement of organizational information within that company is known as the organizational structure.

false

The organizational-management process consists of seven steps: (1) doing research, (2) establishing the mission and vision, (3) assessing the current reality, (4) formulating the grand strategy, (4) implementing the strategy, (6) maintaining strategic control, and (7) maintaining the feedback loop.

false

To achieve a sustainable competitive advantage, La Grand Parfumerie (a company that develops women's perfumes and men's colognes) must benchmark its competition so that La Grand Parfumerie can produce the same products as its competition but at a lower price.

false

True or false: Overconfidence bias is the tendency of decision makers to be influenced by the way a situation or problem is presented to them.

false

Two advantages of decentralization are that (1) managers are encouraged to not solve their own problems, but rather to ask for assistance as soon as possible, and (2) decisions are made more slowly, because they are discussed at a higher level of management.

false

Vertical Integration

firms expands into business that provide the supplies it needs to make products

An organization that wants to eliminate layers in favor of creating a culture where employees have more power should consider adopting a _____ organizational structure.

flattened

Which of Porter's competitive strategies are appropriate when addressing a narrow

focused-differentiation cost-focus

A _____ is a vision or projection of the future that is made following a SWOT analysis.

forecast

Leela's Home Decorators believes that the demand for its services will expand greatly, because a real-estate developer has just purchased 100 acres in town. The developer is planning to build 1,000 condominium units on the property. The managers of Leela's Home Decorators are making a projection for the future, also known as a

forecast

All the following are characteristics of group decision-making EXCEPT groups make decisions quickly their size affects their decision quality their knowledge counts they may be too confident

groups make decisions quickly

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(n) _____ strategy.

growth

If an organization wishes to become more controlling and authoritative toward its employees, it should consider adopting a(n) _____ structure.

hierarchical

A person's decision-making style is a combination of how a person perceives something as well as ____

how they respond to it

Porter's five competitive forces form a model for _____ analysis.

industry

Which of the following is an advantage of group decision making?

intellectual stimulation

According to Kahneman, System 1 thinking is _____

intuitive and largely unconscious

Organizational culture: (select all that apply)

is passed on to new employees through socialization and mentoring significantly affects work outcomes at all levels of the organization is the social glue that binds members of the organization together represents beliefs and values shared among workers helps employees understand why the organization does what it does

One thing groupthink teaches us is that cohesiveness:

isn't always a good thing.

cost-focus strategy

keep the costs of a product below those of competitors and to target a narrow market

cost leadership strategy

keep the costs, and hence prices, of a product or service below those of competitors and to target a wide market

An organization's _____ can pay attention to, measure, and control a number of activities, processes,or outcomes in order to foster a certain culture.

leaders

to be successful, strategic planning requires a company to have a _____ orientation

long term

constance Bagley's decision tree is specifically designed for use when _____

making ethical choices

More positive organizational outcomes are associated with _____ cultures.

market

What two things does the BCG matrix evaluate?

market share business growth rates

Analytical decision makers:

may overanalyze a situation take time to make decisions

An organization where authority is centralized, tasks and rules are clearly specified, and employees are closely supervised is called _____.

mechanistic

Top-down structure and rigid rules are characteristics of a(n) _____ organization.

mechanistic

Francis, who is starting a painting business, plans to write down the purpose of his painting business and his company's reason for being. Francis is writing his

mission statement

Diversification involves

moving into a new lines of business

Ana is a teacher who became interested in helping adults in some of the poorer neighborhoods learn how to read. She plans to start a reading center in a low-income area to help residents with reading skills at no cost. Ana's center is an example of a(n)

nonprofit organization

Satisficing and intuition are two ____________ models of decision making

nonrational

A company dress code and award ceremonies would be part of

observable artifacts

The readily apparent symbols and manifestations of an organization's culture are called its _____.

observable artifacts

Evidence-based decision relies on ____

observations about what actually works

A hospital is an example of a nonprofit organization because it is formed to _____.

offer services to clients

The three types of organizational design are:

open boundaries, traditional, horizontal

What are the three core processes of business identified by Bossidy and Charan?

operations strategy people

Environmental factors that an organization may exploit for competitive advantage are called organizational _____

opportunities

external part of swot

opportunities and threats

A(n) _____ is a system of consciously coordinated activities or forces of two or more people.

organization

A(n) ______ is a system of consciously coordinated activities or forces of two or more people.

organization

A box-and-lines illustration showing the formal lines of authority and the organization's work specializations is called a(n) ______ chart.

organizational

Stars are _____, according to the BCG matrix. Stars have included Apple and the diamond company DeBeers.

organizations with high growth and high market share which are definite keepers

Sustainable competitive advantage exists when

other companies cannot duplicate the value that an organization delivers to customers.

business plan

outlines proposed firm's goals, strategy for achieving and standards for measuring success

The _____ bias occurs when people's positive feelings about their own decision-making ability is greater than their objective accuracy.

overconfidence

Of the three core processes of business identified by Bossidy and Charan, which do they believe is the most important?

people

The extent to which your personality and values match the climate and culture in an organization is referred to as _____.

person-organization fit

Some businesses have created open-area workspaces where employees sit at desks that are side-by-side and no walls are between them. This is to foster collaboration among the staff. What aspect of culture change does this represent?

physical design

the rational model of decision-making is considered _____ in that it describes how managers should make decisions, rather than how they actually make them

prescriptive

Strategic positioning attempts to achieve sustainable competitive advantage by:

preserving what is distinctive about a company

Which of the following can leaders pay attention to, measure, and control in order to change the organization's culture? (select all that apply)

processes activities outcomes

If an organization wishes to change its culture, managers can alter the types of _____ and status symbols they give out and to whom they give them.

rewards

Organizations can use _____, activities that celebrate important events or achievements for the organization, to change the organization's culture.

rites and rituals

A hierarchy culture has an internal focus; it values ____ over flexibility.

stability and control

Some of the strongest ways to embed organizational culture include which two of the following?

status symbols rewards

______________ focus(es) on developing a comprehensive program for long-term success.

strategic planning

Michael Porter defined _____ as an attempt to achieve sustainable competitive advantage by preserving what is distinct about a company.

strategic positioning

The skills and capabilities that give an organization special competencies and competitive advantages in executing strategies in pursuit of its mission are called organizational ______

strenght

Many customers have visited Sally's Diner for decades because of the diner's friendly service. Most customers feel that Sally's is the friendliest placed around. In a SWOT analysis, the friendly service at Sally's is an example of a company

strength

Within a SWOT analysis, the letter "S" represents a company's _____.

strengths

internal part of swot

strengths and weaknesses

When other companies cannot duplicate the value provided by a competitor, then the competitor has established a(n) _____ competitive advantage.

sustainable

In terms of organizational culture, a _______ is an artifact, act, quality, or event that conveys an organization's most important values to others.

symbol

People with a conceptual decision-making style are likely to do which of the following?

take risks, find creative solutions, and rely on intuition

An organization comprised of many levels with narrow spans of managerial control is described as _____.

tall

What are three characteristics that affect decision making by a group?

the efficiency of the group the size of the group the knowledge of group members

A corporate culture is a defined set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and reacts to its various environments.

true

A stability strategy is a grand strategy that involves little or no significant organizational change. For example, Love Forever is a jewelry store that sells only one type of item: engagement and wedding rings. The management of Love Forever does not plan to branch out into selling different types of jewelry; the company has a reputation for being the go-to store to purchase wedding rings, and it plans to maintain that strategy.

true

Hannah, the youngest owner of a family-owned grocery, wants to make sure her company's culture is embedded in their organization. In a recent tradeshow workshop, she learned that she can do this by having company rites and rituals, continuing to tell stories about company legends, and being a role model to her employees.

true

Johnson's Fruit Farm is one of several stores in the county where customers can purchase locally grown fruits and vegetables. However, Mrs. Johnson also offers weekly workshops in her store on topics such as canning, healthy eating, and how to grow a garden, which no other store in the county does. By offering these unique workshops, the Johnsons are engaging in strategic positioning.

true

Mutual-benefit organizations are voluntary collectives whose purpose is to advance members' interests, while nonprofit organizations are formed to offer services to some clients, not to make a profit.

true

Strategy implementation is putting strategic plans into effect, which means dealing with roadblocks within the organization's structure and culture and seeing if the right people and control systems are available to execute the plans.

true

Sue and Jane Smith are writing the vision statement for their new consignment shop, Then & Now. Because they want their employees and business to grow and reach goals, Then & Now's mission statement should be positive and inspiring, pushing their organization and the workers to achieve goals that they believe are beyond its reach.

true

The owners of a computer repair shop want to better formulate strategies, so they are doing a SWOT analysis to understand the strengths and weaknesses within their company and the opportunities and threats of the external environment. These are some of the benefits of doing a SWOT analysis.

true

True or false: According to Bossidy and Charan, execution is the central part of any company's strategy.

true

True or false: According to the text, setting aside time to reflect is one way to develop strategic thinking.

true

True or false: CEOs are at a higher risk of being fired for ethical violations than ever before because the public has become less forgiving of unethical behavior.

true

True or false: Many small business owners do not engage in strategic planning

true

Common purpose, one of the four common elements of organizations proposed by Schein,

unifies members and helps everyone understand the organization's reason for being.

What four characteristics are being addressed in a VRIO analysis?

value rarity imitability organization