MGMT 449 Final Exam Study Set
Wendy's
#roasted F*ckin got ppl's asses on Twitter by roasting them Went mega viral Probably gonna ask what other company could learn from Wendy's
Bird Scooter
A**holes that put their scooters in cities and were like "haha good fckin luck" Got sued a lot Is it sustainable for the future? How can they remain sustainable in the long run? A: Don't be dicks and look at legislation and regulations before placing scooters. Also, advertise more you cheap f*cks
Strategic Alliances
A cooperative relationship between two or more firms
Business Incubators
A corporate new venture group that supports and nurtures fledgling entrepreneurial ventures until they can thrive on their own as stand-alone businesses
Threat Analysis
A firm's awareness of its closest competitors and the kinds of competitive actions they might be planning
Adaptive New Entry
A firm's entry into an industry by offering a product or service that is somewhat new and sufficiently different to create value for customers by capitalizing on current market trends
Pioneering New Entry
A firm's entry into an industry with a radical industry with a radical new product or highly innovative service that changes the way business is conducted New entrants with a radical new product or highly innovative service may change the way business is conducted in an industry A pioneering new entry is disruptive to the status quo of an industry
Imitative New Entry
A firm's entry into an industry with products or services that capitalize on proven market successes and that usually have a strong marketing orientation Sometimes the key to success with an imitative strategy is to fill a market space where the need had previously been filled inadequately
New Venture Groups
A group of individuals, or a division within a corporation, that identifies, evaluates, and cultivates venture opportunities
Board of Directors
A group that has a fiduciary duty to ensure that the company is run consistently with the long-term interests of the owners, or shareholders, of a corporation and their acts as an intermediary between the shareholders and management
New Competitive Action
Acts that might provoke competitors to react, such as new market entry, price cutting, imitating successful products, and expanding production capacity
Aligning the Interests of Owners and Managers
A key characteristic of the modern corporation is the separation of ownership from control To minimize the potential for managers to act in their own self-interest of "opportunistically," the owners can implement some governance mechanisms First, there are 2 primary means of monitoring the behavior of managers. These include: - A committed and involved board of directors that acts in the best interests of the shareholders to create long-term value - Shareholder activism, wherein the owners view themselves as shareowners instead of shareholders and become actively engaged in the governance of the corporation Finally, there are managerial incentives, sometimes called "contract-based outcomes," which consist of reward and compensation agreements Here, the goal is to carefully craft managerial incentive packages to align the interests of management with those of the stockholders
Corporation
A mechanism created to allow different parties to contribute capital, expertise, and labor for the maximum benefit of each party The shareholders (investors) are able to participate in the profits of the enterprise without taking direct responsibility for the operations The shareholders have limited liability as well as rather limited involvement in the company's affairs. However, they reserve the right to elect directors who have the fiduciary obligation to protect their interests
Product Champions
An individual working within a corporation who brings entrepreneurial ideas forward, identifies what kind of market exists for the product or service, finds resources to support the venture, and promotes the venture concept to upper management
Emotional Intelligence (EI)
An individual's capacity for recognizing his or her own emotions and those of others, including the five competencies of self-regulation, motivation, empathy, and social skills Successful leadership traits include integrity, maturity, energy, judgment, motivation, intelligence, expertise, and so on
For an opportunity to be viable, it needs to have 4 qualities:
Attractive. The opportunity must be attractive in the marketplace; that is, there must be market demand for the new product or service Achievable. The opportunity must be practical and physically possible Durable. The opportunity must be attractive long enough for the development and deployment to be successful; that is, the window of opportunity must be open long enough for it to be worthwhile Value Creating. The opportunity must be potentially profitable; that is, the benefits must surpass the cost of development by a significant margin
Human Capital
Bankers, venture capitalists, and angel investors agree that the most important asset an entrepreneurial firm can have is strong and skilled management
Motivation
Being driven to achieve for the sake of achievement, not simply for money or status
Virtual Organization
Can be viewed as a continually evolving network of independent companies - suppliers, customers, even competitors - linked together to share skills, costs, and access to one another's markets The term virtual, meaning "being in effect but not actually so," is commonly used in the computer industry These organizations need not be permanent, and participating firms may be involved in multiple alliances
Venture Capitalists
Companies organized to place their investors' funds in lucrative business opportunities
Ethics
A system of right and wrong
Agency Theory
A theory of the relationship between principals and their agents, with emphasis on 2 problems: 1. The conflicting goals of principals and agents, along with the difficulty of principals to monitor the agents 2. The different attitudes and preferences toward risk of principals and agents
Market Dependence
Degree of concentration of a firm's business in a particular industry
Cons of Barrier-Free Structures
Difficult to overcome political and authority boundaries inside and outside the organization Lacks strong leadership and common vision, which can lead to coordination problems Time-consuming and difficult-to-manage democratic processes Lacks high levels of trust, which can impede performance
Internal Development
Entering a new business through investment in new facilities, often called corporate entrepreneurship and new venture development Compared to mergers and acquisitions, firms that engage in ____ capture the value created by their own innovative activities without having to "share the wealth" with alliance partners or face the difficulties associated with combining activities across the value chains of several firms or merging corporate cultures
To make boundaryless organizations work, they must:
Facilitate coordination and integration Create a common culture and shared values Implement horizontal organization structures Implement horizontal systems and processes Implement proper communications and information technology (IT) Practice human resource management
Entrepreneurial Opportunities
For new business start-ups, opportunities come from many sources - current or past work experiences, hobbies that grow into businesses or lead to inventions, suggestions by friends or family, or a chance event that makes an entrepreneur aware of an unmet need For established firms, new business opportunities come from the needs of existing customers, suggestions by suppliers, or technological developments that lead to new advances For all firms, there is a major, overarching factor behind all viable opportunities that emerge in the business landscape: change
Crowdfunding
Funding a venture by pooling small investments from a large number of investors; often raised on the Internet
Entrepreneurs tend to have characteristics that differentiate themselves from corporate managers:
Higher core self-evaluation Higher conscientiousness Higher openness to experience Higher emotional stability Lower agreeableness These personality traits are embodied in the behavioral attributes necessary for successful entrepreneurial leadership - vision, dedication and drive, and commitment to excellence
Ethical Environment
Holding on to moral principles of what is right and what is wrong, guided by value systems prevalent in society and generally behaving in a responsible way
Structure
Identifies the executive, managerial, and administrative organization of a firm and indicates responsibilities and hierarchical relationships. It also influences the flow of information as well as the context and nature of human interactions A firm's strategy and structure change as it increases in size, diversifies into new product markets, and expands its geographic scope
Emotional Intelligence Drawbacks
If leaders exhibit too much of empathy, interpersonal astuteness, awareness of their own feelings, and an awareness of their impact on others, it may become "too much of a good thing" if he or she is allowed to drive inappropriate behaviors Leaders must be able to make the "tough decisions." They must be able to appeal to logic and reason and acknowledge others' feelings so that people feel the decisions are correct. However, it is easy to over-identify with others or confuse empathy with sympathy Leaders may become judgmental and overly critical about the shortcomings they perceive in others. They are likely to dismiss other people's insights, making them feel undervalued There is a fine line between being excited about something and letting your passion close your mind to other possibilities or cause you to ignore realities that others may see If the leader makes too many unannounced visits, it may create a culture of fear and micromanagement
Why do companies launch new competitive actions? There are several reasons:
Improve market position Capitalize on growing demand Expand production capacity Provide an innovative new solution Obtain first-mover advantages
Competitive Dynamics
Intense rivalry, involving actions and responses, among similar competitors vying for the same customers in a marketplace
Barrier-Free Organization
Involves making all organizational boundaries - internal and external - more permeable. Teams are a central building block for implementing the boundaryless organization For these organizations to work effectively, the level of trust and shared interests among all parts of the organization must be raised. The organization needs to develop among its employees the skill level needed to work in a more democratic organization
DoorDash
Is DoorDash profitable in the long run? Crazy boom when it first launched People don't think it's sustainable in the long run Probably gonna ask ways in which we can keep doordash sustainable
Entrepreneurial Leadership
Leadership appropriate for new ventures that requires courage, belief in one's convictions, and the energy to work hard even in difficult circumstances and that embodies vision, dedication and drive, and commitment to excellence
Pros of Barrier-Free Structures
Leverages the talents of all employees Enhances cooperation, coordination, and information sharing among functions, divisions, SBUs, and external constituencies Enables a quicker response to market changes through a single-goal focus Can lead to coordinated win-win initiatives with key suppliers, customers, and alliance partners
Ways to Undertake a Structured Search for Entrepreneurial Ideas
Look at what's bugging you Talk to the people you know Look to other markets Get inspired by history
Home Depot
Lots of good good shit during the pandemic They had a bunch of DIY vids on their site, how to stay safe during the pandemic, at-home projects people could do, donations to hospitals Most likely gonna ask what they could do or change, kinda hard but target the small shit Employees were trained to suggest not wearing a mask, could say they should have been trained more assertively because it's concerning other peoples' health
Strategic Actions
Major commitments of distinctive and specific resources to strategic initiatives
Cycle of Competitive Dynamics
New Competitive Action -> Threat Analysis -> Motivation and Capability to Respond -> Types of Competitive Action -> Likelihood of Competitive Reaction -> back to beginning
Joint Ventures
New entities formed within a strategic alliance in which two or more firms, the parents, contribute equity to form the new legal entity
Social Capital
New ventures founded by entrepreneurs who have extensive social contacts are more likely to succeed than any ventures started without the support of a social network
Boundaryless Organizational Designs
Organizations in which the boundaries, including vertical, horizontal, external and geographical boundaries are permeable We are not suggesting that boundaryless organizational designs replace the traditional forms of organizational structure, but they should complement them
Learning Organization
Organizations that create a proactive, creative approach to the unknown; characterized by (1) inspiring and motivating people with a mission and purpose, (2) developing leaders, (3) empowering employees at all levels, (4) accumulating and sharing internal knowledge, (5) gathering and integrating external information, and (6) challenging the status quo and enabling creativity To enhance the long-term viability of organizations
Modular Organization
Outsources nonvital functions, tapping into the knowledge and expertise of "best in class" suppliers, but retains strategic control Focus on the need to create seamless relationships with external organizations such as customers or suppliers While the modular type emphasizes the outsourcing of noncore activities, the virtual (or network) organization focuses on alliances among independent entities formed to exploit specific market opportunities
Angel Investors
Private individuals who provide equity investments for seed capital during the early stages of a new venture
Tactical Actions
Refinements or extensions of strategies usually involving minor resource commitments
Entrepreneurial Resources
Resources are an essential component of a successful entrepreneurial launch For start-ups, the most important resource is usually money because a new firm typically has to expend substantial sums just to start the business Human capital and social capital are also important
5 dilemmas when pursuing innovation:
Seed versus weeds. Lots of ideas, which ones will grow, which ones won't? Experience versus initiative. Companies must decide who will lead an innovation project Internal versus external staffing. Innovation projects need competent staffs to succeed Building capabilities versus collaborating. Innovation projects often require new sets of skills Incremental versus preemptive launch. Companies must manage the timing and scale of new innovation projects
How is new value created? (dealing with entrepreneurship)
Start-up ventures, Major corporations, Family-owned businesses, Nonprofit organizations, Established institutions
AirBnB
Started off small but got picked up by a big company (Y Combinator) and exploded in popularity Stealing customers from hotel industry Having trouble in New York cuz they have a shit ton of regulations Concerns with safety, regulation
Social Skill
The ability to build and manage relationships to move people in the desired direction
Self-Regulation
The ability to control or redirect disruptive emotions and impulses and adapt to changing circumstances
Self-Awareness
The ability to know your own emotions, drives, values, and goals as well as recognize their impact on others
Empathy
The ability to see and consider other people's feelings especially when making decisions
Mergers
The combining of two or more firms into one new legal entity
Entrepreneurship
The creation of new value by an existing organization or new venture that involves the assumption of risk
Market Commonality
The extent to which competitors are vying for the same customers in the same markets
Resource Similarity
The extent to which rivals draw from the same types of strategic resources
Organizational Structure
The formalized patterns of interactions that link a firm's tasks, technologies, and people Structure provides a means of balancing two conflicting forces: - A need for the division of tasks into meaningful groupings - The need to integrate such groupings in order to ensure efficiency and effectiveness
Acquisitions
The incorporation of one firm into another through purchase
Financial Resources
The level of available financing is often a strong determinant of how the business is launched and its eventual success The types of financial resources that may be needed depend on 2 factors: the stage of venture development and the scale of the venture
Ethical Orientation
The practices that firms use to promote and ethical business culture, including ethical role models, corporate credos and codes of conduct, ethically based reward and evaluation systems, and consistently enforced ethical policies and procedures
Opportunity Recognition
The process of discovering and evaluating changes in the business environment, such as a new technology, sociocultural trends, or shifts in consumer demand, that can be exploited
Diversification
The process of firms expanding their operations by entering new businesses
Corporate Governance
The relationship among various participants in determining the direction and performance of corporations. The primary participants are (1) the shareholders, (2) the management, and (3) the board of directors
Southwest Airlines
They got good staff They only use like 1 type of plane though so that kinda sucks If there's a total recall, they're kinda f*cked They put people first, that's like their thing Low turnover rate because they value staff