Management test 2

what do you when developing the plan

- define mission and vision - set goals - manage goal conflict

what do you when translating the plan

- define tactical plans and objectives - develop strategy map - define contingency plans and scenarios

parts of a strategy map for aligning goals

- financial performance goals - customer service goals - internal business process goals - learning and growth goals

parts of financial performance in strategy map

- increase revenue in existing markets - increase productivity and efficiency - increase revenue in new markets and products

choice among three main models of decision-making approaches depends on ...

- on the manager's personal preference -whether the decision is programmed or nonprogrammed -degree of uncertainty associated with the decision

mission statement defintion

- reason the organization exists - how they differ from their competitors - may include statement of their values

limitations of planning

-Goals and plans can create a false sense of certainty -Goals and plans may cause rigidity in a turbulent environment -Goals and plans can get in the way of intuition and creativity

Examples of franchises

- McDonald's - Subway - Papa John's - Red Driving School - KFC - Burger King - Hertz - Kumon - Hard Rock Cafe - Hilton Hotels

assumptions of political model

- Organizations are made up of groups with diverse interests, goals, and values - Information is ambiguous and incomplete - Lack of time, resources, or mental capacity to process all information regarding a problem - Decisions are the result of bargaining and discussion among coalition members

parts of customer service goals in strategy map

- build and maintain good customer relationships - be the leader of quality and reliability - provide innovative solutions to customer needs

operational plans definition

developed at the lower levels of the organization to specify action plans toward achieving operational goals and to support tactical plans

tactical plan example

developing marketing plan for the foreign market

decision styles definition

distinctions among people with respect to how they evaluate problems, generate alternatives, and make choices

decision making step 6: evaluation and feedback

gather info to determine how well the decision was implemented and whether it achieved its goals

characteristics of optimizers

get personal satisfaction from being business owners

programmed decisions definition

involve situations that have occurred often enough to enable decision rules to be developed and applied in the future

joint venture definition

involved s strategic alliance or program by two or more organizations

confirmation bias definition

occurs when an individual searches for only evidence that will confirm his or her beliefs instead of evidence that might disconfirm them

what is achieve synergy

occurs when organizational parts interact to produce a joint effect that is greater than the sum of its parts acting alone

strategic goals definition

official goals; broad statement describing where the organization wants to be in the future, long term

standing plans definition

ongoing plans that provide guidance for tasks or situations that occur repeatedly within the organization

co working facility

open office environment shared by multiple freelance entrepreneurs as well as corporate telecommuting employees or others who don't have a regular office

external SWOT analysis includes

opportunities and threats

standing plans example

organizational policies, rules and procedures

advantages of franchise

owner provides management help known brand name reliable financial projections

Diversifitcation definition

strategy of moving into new lines of business

Internal SWOT Analysis includes

strengths and weaknesses

What is entrepreneurship?

the process of initiating a business venture, organizing the necessary resources, assuming the associated risks, and enjoying the rewards

tactical goals definition

the results that major divisions and departments within the organization intend to achieve

decision making step 5: implementation of chosen alternative

the use of managerial and persuasive abilities to ensure that the chosen alternative is carried out

sociologist argues that women have less access to capital because ...

they have to work harder to convince others that they have what it takes to be successful

Porter's Five Forces

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

characteristics of being a hard worker

thrive on the challenge of building a larger, more profitable business

what does it mean to think strategically

to take the long-term view and to see the big picture, including the organization and the competitive environment, and consider how they fit together

true or false: traditional minority owned retail stores and restaurants are being complemented by firms in financial services, software, insurance and online businesses

true

immigrants are almost ____ as likely as native born Americans to start a business

twice

business incubator

typically produces shared office space, management support services and management and legal advice to entrepreneurs

Partnership definition

unincorporated business by two or more people

Sole Proprietorship

unincorporated business owned by one person for profit

competitive advantage needs to be ___ to attract people to your organization

unique

Conceptual Style of Decision Making

use a broad amount of information to solve problems creatively

administrative model definition

use of a rational decision-making process within the limits of human and environmental factors

what does strategic management try to do

use the opportunities and threats in the environment to give us the competitive advantage

brainstorming definition

uses a face-to-face interactive group to spontaneously suggest as many ideas as possible for solving a problem

parts of personal decision style category of personal decision framework

directive analytical conceptual behavioral

characteristics of a partnership

easy to start use a formal partnership agreement unlimited liability often dissolve within 5 years

characteristics of sustainers

enjoy change to balance work and personal life

what does drucker say about objectives/goals

opposite of 'if you want it done right do it yourself' any business enterprise must build a true team. each member of the enterprise contributes something different, but they must all pull in the same direction and their contributions must fit together to produce a whole-- without gaps, without friction, without unnecessary duplication of effort.

globalization strategy defintion

uses standardized products and advertising worldwide

Coporate level strategy definition

The way a company seeks to create value through the configuration and coordination of multimarket activities

merger definition

Two or more firms coming together to form a new firm

example of cost leadership strategy

Wal-Mart

McDonalds earning well over ___ in sales annually

$2 million

franchise applicants for McDonalds must have a minimum of ___ available in liquid assets

$500,000

Source of New Business Ideas

- In-depth understanding of industry or profession - Market niche spotted - Brainstorming - Copying someone else - Hobby - Other

Stars (BCG Matrix)

-upper left quadrant) occur in high-growth markets and are high market share products. -often require a heavy resource investment in such things as promotions and new production facilities to fuel their rapid growth. -As their market growth slows, starts will migrate from heavy users of resources to heavy generators of resources and become cash cows. - ex: uber

Tools for putting strategy into action

-visible leadership -clear roles and accountability -human resources -candid communication

Why do managers make bad decisions?

1. Being influenced by initial impressions 2. Justifying past decisions 3. Seeing what you want to see

levels of goals and plans

1. Mission Statement 2. Strategic Goals/Plans 3. Tactical Goals/Plans 4. Operational Goals/Plans

managerial decision making process

1. Recognition of Decision Requirement 2. Diagnosis and Analysis of Causes 3. Development of Alternatives 4. Selection of Desired Alternative 5. Implementation of Chosen Alternative 6. Evaluation and Feedback

model of MBO process

1. Set goals 2. Develop action plans 3. Review progress 4. Appraise overall performance

steps of the organizational process

1. develop plan 2. translate the plan 3. plan operations 4. performance management 5. monitor and learn

how many firms were majority women owned in 2018

12 million

growth on immigrant entrepreneurs in the US from 1998-2016

13.7% --> 29.5%

how small is a small business

3 types: owner only 1-19 employees 20-499 employees

in 2019 how many people are immigrant entrepreneurs

3.2 million

what percentage of businesses are female owned

35.8%

there are ____ McDonalds located in more than 100 countries

38,000

what percentage of businesses are male owned

53.7%

how many people are employed in minority owned businesses

6.3 million

what percent of sources of start up capital for entrepreneurs are from personal savings

78%

what percent of businesses are equally owned by male and female

8.9%

franchise owners pay about __ of store revenue to McDonalds each year

82%

how many McDonalds are franchise operations

93%

business plan

A document specifying the business details prepared by an entrepreneur prior to opening a new business.

Key performance indicators (KPIs)

A tool used to assess what is important to an organization and how well the organization is progressing toward attaining its strategic goal, so that managers can establish lower-level goals that drive performance toward the overall strategic objective.

focus strategy definition

concentration on a specific region or buyer

example of co-working facility

Atlanta tech village

Traits of Entrepreneurs

Autonomy, Entrepreneurial Sacrifice, High Energy, Need to Achieve, Self-Confidence, Locus of Control, tolerance for ambiguity

differentiation strategy definition

Distinguishing an organization's products from the products of competitors on dimensions such as product design, quality, or after-sales service.

equity financing

Funds that are invested in exchange for ownership in the company.

example of unrelated diversification

Harley Davidson once tried to sell Harley branded bottled water

plan example

I can get dogs from the pound. there are so many abandoned animals; it will be quicker, less expensive and easier to get dogs from the pound instead of breeders

backward integration example

Netflix producing it's own content

examples of B corporations

Patagonia, toms, malala fund, etc

strategy execution

Putting strategy into action by adjusting various parts of the organization and directing resources to accomplish strategic goals

intuition (admin model) definition

Quick apprehension of situation based on practice and experience

personal decision framework

Situation + Personal Decision Style = Decision Choice

strategy formulation definition

The development of a set of corporate, business, and functional strategies that allow an organization to accomplish its mission and achieve its goals

what are the parts of a mission statement

Who: What: Where: When: Why:

anchoring bias definition

a cognitive bias that causes us to rely too heavily on the first piece of information we are given about a topic

evidence based decision making definition

a commitment to make more informed and intelligent decisions based on the best available facts and evidence

Microsoft mission statement

a computer at every desk and in every home

Strategic Business Unit (SBU)

a division, product line, or other profit center within the parent company

wicked decision problem

a highly ambiguous situation involving conflict goals and decision alternatives, rapidly changing circumstances, fizzy info, unclear links Among decision elements and the inability to evaluate whether a proposed solution will work There is no "right answer"

BCG Matrix

a means of evaluating strategic business units on the basis of (1) their business growth rates and (2) their share of the market

SWOT analysis

a planning tool used to analyze an organization's strengths, weaknesses, opportunities, and threats

certainty definition

a situation in which all the information the decision maker needs is fully available

strategy map

a visual representation of a company's critical objectives and the crucial relationships among them that drive organizational performance

overall goal of a strategy map

accomplish mission; create optimal value

single-use plans defintion

achieve objectives that are not likely to be reparented again in the future

what are MBOs based on

achievement of goals

business level strategy definition

an integrated and coordinated set of commitments and actions the firm uses to gain a competitive advantage by exploiting core competencies in specific product markets

decision making step 2: diagnosis and analysis

analyze underlying casual factors 5 why's

different parts of equity financing

angel financing venture capital firms crowd funding

goal example

any veteran who asks me for a dog will have one within one month of the request

forward integration example

apple moved into retailing

characteristics of effective goals

are specific and measurable, have a defined time period, cover key result areas, are challenging but realistic, are linked to rewards

corporation definition

artificial entity created by the state and existing apart from its owner

Analytical style of decision making

base decisions on all available rational data

classical model definition

based on rational economic assumptions and manager beliefs about what ideal decision making should be

mission statement provides ___

basis for development of all subsequent goals and plans

what does "B" corporation stand for

benefit corporation

decision making step 4: selection of desired alternative

best alternative is one in which the solution best fits the firm's overall goals and achieves the desired results using the fewest resources

parts of decision choice of personal decision framework

best solution to the problem

plan definition

blueprint for goal achievement specifying the necessary resource allocations, schedules, tasks and other actions

debt financing

borrowing money that must be repaid at a later date to start a business

electronic brainstorming definition

brings people together in an interactive group over a computer network, rather than meeting face to face

Coalition Management

building an alliance of people who support managers and influence efforts toward achieving goals

Decision definition

choice made from among available alternatives

satisficing (admin model) definition

choosing a "good enough" alternative

example of single use plans

closing a plant or major layoffs

Glocalization Strategy

combines global coordination to attain efficiency with local flexibility to meet needs in different countries

parts of a business level strategy

company forces profitability

aligned goals are ___

consistent and mutually supportive so that the achievement of goals at lower levels permits the attainment of higher-level goals

what is part of the business level strategy

consumer products unit biotechnology unit media unit

three levels of strategy in organizations

corporate level strategy business level strategy functional level strategy

what is part of the corporate level strategy

corporation

linked in mission statement

create economic opportunity for every member of the global workforce

what does social entrepreneurship focus on

creating social value by providing solutions to social problems with a secondary purpose of generating profit and returns

risk definition

decision has clear cut goals and good information is available but future outcomes associated with each alternative are subject to chance of loss or failure

Embeddedness definition

deep understanding and acceptance of organizational direction and purpose throughout the organization

contingency planning definition

define company response to be taken in the case of emergencies, setbacks, or unexpected conditions

strategic plans defintion

define the action steps by which the company intends to attain strategic goals also defines organizational activities and resource allocations

tactical plans definition

define what major departments and organizational subunits will do to implement the organization's strategic plan

goal definition

desired future circumstance or condition that the organization attempts to realize

planning definition

determining the organizations goals and defining the means for achieving them

decision making step 3: development of alternatives

develop alternative solutions that will respond to the needs of the situation

behavioral style of decision making

exhibit a deep concern regarding effect of decision on others

vertical integration definition

expansion into business that supply to business or are distributors

related diversification definition

expansion into new business related to existing business activities

unrelated diversification definition

expansion into new lines of business that are not related

debt financing characteristics

fam and friends personal credit cards bank loans finance companies small business administration

what is part of the functional level strategy

finance R&D manufacturing marketing

suggested process of starting an online business

find market niche create professional website choose domain name know when o pivot use social media

franchising definition

firm collects upfront and ongoing fees in exchange for letting other firms offer products and services under its brand name and using its processes

where is political model useful

for nonprogrammed decisions when conditions are uncertain, info is limited, and there is conflict about goals to pursue or action to take

scenario building definition

forecasting technique that looks at current trends and discontinues and visualizes future possibilities

uncertainty defintion

goals are known, but information about alternatives and future events is incomplete

related diversification example

google moves into AI

venture capital firms

group that invests money in new or expanding businesses for ownership and potential profits

multi-domestic strategy definition

handling of competition in each country remained independent of industry competition in other countries

characteristics of jugglers

high energy people who enjoy handling ever detail of their own business

traits not consistant with managers at large companies that are also those of entrepreneurs

high energy, tolerance for ambiguity

example of operational plans

hire employees for new foreign market

normative (classical model) definition

how a decision maker should make a decision

descriptive (admin model) definition

how managers actually make decisions in complex situations

what is specified in a formal partnership agreement

how partners share responsibility and resource how partners contribute expertise

what does a strategy map show

how specific goals and plans in each area are linked

what does MBOs ignore

how you got it done

what are the 5 types of small business owners

idealists, optimizers, hard workers, jugglers, sustainers

decision making step 1: recognition of decision requirement

identify the problem or opportunity

disadvantage of unlimited liability

if sued they can seize all your personal assets since you have unlimited liability

example of strategic plans

increase revenue through expansion into a foreign market

Legal-Political strategic thinking

inflation? interest rates? labor force participation?

disadvantage of franchise

lack of control franchisor dictates the price must purchase equipment, building, new product offerings

Dogs (BCG Matrix)

low market share, low market growth no investment keep if some profit consider divestment

nonprogrammed decisions definition

made in response to situations that are unique, are poorly defined and largely unstructured, and have important consequences for the organization

Sole Proprietorship characteristics

majority of business in US few legal requirements proprietor has total ownership and control owner has unlimited liability

tactical goals apply to what level of management

middle management

how many minority owned businesses are there in the US

more than 11 million

how do you incorporate in Georgia?

must go to Secretary of State in GA who will give you papers and then the state of GA will decide to recognize the company as a separate entity from yourself

traits consistant with managers at large companies that are also those of entrepreneurs

need to achieve, self confidence

Management by means (MBM)

new systemic approach that focuses attention on the methods and processes used to achieve goals

bounded rationality (admin model) definition

people have limits or boundaries on how rational they can be

Functional-level strategy definition

pertains to the major functional departments within each business unit, such as manufacturing, marketing, and research and development

portfolio strategy

pertains to the mix of SBUs and product lines that fit together in a logical way to provide synergy and competitive advantage

loss aversion definition

place a higher value on avoiding losses than on potential gain

strategy definition

plan of action that described resource allocation and activities for dealing with the environment, achieving a competitive advantage and attaining the organization's goals

____ forces the entrepreneur to carefully think through the issue and problems associated with starting a developing business

planning

goal + plan = ___

planning

Directive Style of Decision Making

prefer simple, clear-cut solutions to problems

crisis planning definition

preparing organizations, managers and employees to cope with catastrophic events that could destroy the firm

Crowdfunding

raising capital online from many small investors (but not through the stock market)

issue with classical model

rarely possible the way it is written

missions definition

reason for organizations existence

stretch goals definition

reasonable yet highly ambitious and compelling goals characterizes by both extreme difficulty and extreme novelty that energize people and inspire excellence

overview of launching a start up

start with an idea write a business plan choose a legal structure arrange financing

operational goals definition

results expected from departments, work groups and individuals

characteristics of an idealist

rewarded by change to work on something new and creative

what is an important component of operational plans

schedules

corporation characteristics

separate legal entity limits owners must pay taxes on its income provides continuity more complex paperwork can raise funds through the sale of stock to investors

what kind of companies is multidomestic strategy important for

service

Strategic Management definition

set of decisions and actions used to formulate and execute strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals

the majority of small businesses have how many employees?

single employee, owner only

three types of legal structure

sole proprietorship, partnership, corporation

What is an entrepreneur?

someone who engages in entrepreneurship

what is exploiting core competence

something the organization does especially well in its comparison to its competitors

procedure in standing plans

sometimes referred to as standard operating procedure defines a precise series of steps to attain certain goals

Management by Objectives (MBO)

system whereby managers and employees define goals for every department, project, and person and use them to monitor subsequent performance

example of differentiation strategy

target

primary difference between programmed and unprogrammed decisions is...

the amount of certainty and risk

globalization strategy is based on...

the assumption that a single market exists for many consumer and industrial products

how to obtain certification of the B corporation

the business must pass an impact assessment which scores the organization on environment sustainability, community impact and transparency

Divestment defintion

the exit of a business from a firm's portfolio

Ambiguity definition

the goals to be achieved or the problem to be solved is unclear, alternatives are difficult to define, and information about outcomes is unavailable

what does MBM focus on

the process of achieving the goals

decision making definition

the process of identifying problems and opportunities and then resolving them

operational goals example

we will increase production by 10 percent per week to meet holiday demand

example of strategic goals

we will reduce our environmental footprint and continually seek out renewable resources to use in our products

example of tactical goals

we will reduce our market budget by $10,000

angel financing

wealthy individual who believes in a start-up provides personal funds and advice to help the business get started

competitive advantage definition

what sets the organization apart from the others and provides it with a distinctive edge for meeting customer or client needs in the marketplace

what is create value

willing to pay more money for a brand name even if it is the same as generic brand

risk propensity definition

willingness to undertake risk with the opportunity of gaining an increased payoff

how much revenue do minority owned businesses generate annually

$2 trillion

parts of internal business process goals in strategy map

- build good relationships with suppliers and partners - improve cost, quality and flexibility of operations - excel at innovative product development and next-generation market opportunities

how important is strategic management

-It determines which organizations succeed and which ones struggle -Strategic blunders can hurt a company

Innovative Decision Making

-Start with brainstorming -Use hard evidence -Engage in rigorous debate -Avoid groupthink -Know when to bail -Do a postmortem

SWOT analysis for Kroger company: threats

-aggressive expansion of nontraditional rivals such as Walmart, target and amazon into the grocery business -intense competition may push for price cuts -uncertainty caused by COVID-19 pandemic

SWOT analysis for Kroger company: strengths

-broad geographic distribution -broad array of products and services -strong line of private label brands

characteristics of a business plan

-clear, compelling vision -clear, realistic financial projections -profile of potential customers and target market -details about the industry and competitors -evidence of an effective management team -good formatting and clear writing -short -critical risks -sources and uses of start-up funds and operating funds -summary

what do you when planning operations

-define operational goals and plans -select measures and targets -set stretch goals -crisis planning

reasons for failed execution

-employee resistance -manager behavior doesn't support new direction -inadequate budget or resources -other barriers

SWOT analysis for Kroger company: opportunities

-expand customer service experience, including online sales -increase shelf space for private label brands and organic food -address growing customer concerns over food waste and plastic use

MBO benefits

-focuses manager and employee efforts on activities that will lead to goal attainment -can improve performance at all company levels -improves employee motivation -aligns individual and departmental goals with company goals

bright prospect (BCG Matrix)

-high business growth rate, low market share -new ventures -risky -a few become starts, others are divested

SWOT analysis for Kroger company: weaknesses

-high debt load complicated -manufacturing and distribution networks -slow start on digital ordering technology

what do you when monitoring and learning

-hold planning reviews -hold operational reviews

reasons for starting a business

-joined family business -to control my future -to be my own boss -to fulfill a dream -downsized or laid off

Cash Cows (BCG Matrix)

-low business growth, high market share -milk to finance bright prospects and stars

components of performance management

-management set by objectives -single use plans -standing plans

how does coalition management work

-modify goals by time or location -address conflicts with debate and dialogue -break down barriers and promote cross-silo cooperation

rule definition

-narrow in scope -describes how a specific action is to be performed -may apply to specific setting

assumptions of classical model

-problems are defined -results are calculates -selects alternative with maximized economic return -decision maximized attainment of organizational goals

benefits of planning

-produce a source of motivation and commitment -guide to action -set a standard of performance

parts of situation category of personal decision framework

-programmed/nonprogrammed -classical, admin, political -decision steps

parts of learning and growth goals in strategy map

-promotes employee development via ongoing training - enable continuous learning and knowledge sharing - cultivate a culture of innovation and high performance

project definition

-set of plans for attaining a one-time goal -smaller in scope and complexity than a program -often one part of a larger program

Elements of Competitive Advantage

-target customers -achieve synergy -create value -exploit core competence

which decision style is typical of upper management

conceptual

cost leadership strategy

aggressively seek efficient facilities, cost reductions, and cost controls (not talking about price)

sociocultural strategic thinking

aging population? remote work? quiet quitting?