Module 1

Mission Statement

broadly defines the purpose that distinguishes the org from others of a similar type

As a manager you have been asked to work with your employees to develop goals. What can you expect from this process?

-A benefit of plans is that they lock the organization into a course of action it can stick to, even if the environment changes. -A benefit of goals is that they help motivate employees -One of the drawbacks of plans is that they can create a false sense of security

To find competitive edge adopt one of these:

-Differentiation Strategy: managers seek to distinguish the org's products & services from those of others -Cost Leadership Strategy: Managers aggressively seek efficient facilities, cut costs, & use tight cost controls to be more efficient than others -Focus strategy: managers use either a differentiation or cost leadership approach but they concentrate on a specific regional market or buyer group

MBM Benefits

-Improve Performance -Improves Motivation -Aligns individuals & dept goals with company goals

Effective Goals

-specific & measurable -Defined time period -Linked to rewards -Challenging but realistic -Cover Key Results

MBO Process

1) Set Goals 2) Develop Action Plans 3) Review Progress 4) Appraise Overall Performance

Levels of Goals

1)Mission Statement 2)Strategic Goals (Sr. Mgmt) 3)Tactical Goals (Middle Mgmt) 4)Operational Goals (Lower Mgmt)

Crisis Preparation 3 Steps:

1)design a crisis management team 2)create a detailed crisis plan 3)set up effective communication system

Crowdsourcing Strategy

A recent trend that creates opportunity for more meaningful participation by employees in strategy formulation & execution

Key Performance Indicators

Assess what is important to the org & how well the org is progressing toward attaining its strategic goal -Realistic -Linked to reward

Contingency Planning

Company's response to be taken in the case of emergencies, setbacks, & unexpected conditions

Mi Ola designs swimsuits for women who are athletic in the water and the suits have design features that allow them to stay on during physical activity. This indicates that Mi Ola has a:

Focus strategy cost leadership strategy Cash cow strategy

Desired future circumstance

Goal

Tactical Plans

Help execute strategic plans & accomplish a specific part of the strategy -short term (within the year)

Star

Large market share, rapid growth, additional potential

Cash Cow

Mature, slow growth industry, is a dominant business with large market share

Question Mark

New, rapidly growing industry, small market share Risky; could become a star or could fail

BCG Matrix (Boston Consulting Group)

Organizes businesses along two dimensions-business growth rate & market share

Blueprint for goal achievement

Plan

Tactical Goals

Results that major divisions & depts intend to achieve -Applies to middle management -Describe what major subunits must do for the org to achieve its overall goals

When formulating strategy, Mi Ola's managers scan the business environment for factors that will or could impact the company's competitive advantage. Which of the following would pose as a threat to Mi Ola?

Several top professional women surfers state in interviews that they feel one piece suits are much sexier than bikinis and more practical Mi Ola continues to have limited funds available to invest in inventory, meaning that products are often out of stock

Management by Objectives (MBO)

System where managers & employees define goals for every dept, project, & person & use them to monitor subsequent performance

Through Bullseye univeristy.com, Target corporation uses a reality show-style marketing campaign to build relationships with college students, an ideal market for its affordable dorm room supplies

Target Customers

SWOT Analysis

careful assessment of strengths, weaknesses, opportunities, and threats that affect org performance

External Opportunities & Threats

Threats: Characteristics of the external environment that may prevent the org from achieving its strategic goals Opportunities: Characteristics of the external environment that have the potential to help the org achieve or exceed its strategic goals

True or False: Differentiation strategies can reduce the bargaining power of large customers

True

True or False: A company that strictly controls expenses is likely to use a low cost leadership strategy

True

Porter's Five Competitive Forces

help determine a company's position & competitors in the industry

Strategic Management

set of decisions & actions used to formulate & execute strategies that will provide a competitively superior fit between the org & its environment to achieve org goals

Diversification

strategy of moving into new lines of business

Organization Structure

the set

Benefits of Planning

-Source of motivation -Resource allocation -Guide of Action -Sets a standard for performance

Elements of Competitive Advantage:

-Target customers: define customer & which of their needs are to be served by the company ~Can be defined geographically, demographically, or by other means -Exploit Core Competencies: something the org does especially well in comparison to its competitors -Build Synergy: when organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone -Create Value: combination of benefits received & costs paid

Helen discusses she might arrive at a budget for her website. If she decides to hire a consultant to make the website more mobile-friendly & integrate better across social media platforms, which of the following would be true

-This would be an operational plan -This would be tactical plan -This would be a strategic goal

Imagine that the American Red Cross Board of Governors set a goal of increasing online donations by 15% year over year for the next 3 years. They view this goal as very challenging but achievable. Why might the organizations leaders set such an ambitious goal?

-To meet goals well beyond what has been accomplished before members of the org often find creative and innovative ways to do things -Highly ambitious goals can inspire employees and volunteers

Limits of Planning

-Too much pressure -False sense of certainty -Hinders response to a turbulent environment -Get in the way of creativity & intuition

A financial advisor hosts a blog where he invites other personal finance experts to guest-blog on everything from real estate to estate taxes to tax write-offs. The variety of advising increases the sites search engine optimization & attract many more potential clients for all the participating financial professionals

Build Synergy

True or False: The ability of employees to create innovative products is critical for companies that adopt a low cost leadership strategy

False

Stretch Goals

Highly ambitious goals that are clear, compelling, & imaginative that they fire up employees & engender excellence -typically beyond current levels that people must innovate to find ways to reach them

1) Strategy

Plan of action that describes resource allocation & activities for dealing with the environment, achieving competitive advantage, & attaining the org's goals

Determines goals and means to achieve them

Planning

What is the most fundamental of the 4 Planning functions?

Planning

Decentralized Planning

Planning experts work with managers in major divisions or depts to develop their own goals & plans

Dogs

Poor performer, small share, slow growth market, little profit

Crisis Planning

Prepare the org, managers, & employees to cope with sudden catastrophic events that could destroy the firm if a crisis response plan were not in place ex) extreme weather

Competitive Advantage

What sets the org apart from others & provides it with distinctive edge for meeting customer or client needs

Strategic Plans

Define the actions by which the company intends to attain strategic goals -Defines activities & resource allocations (cash, personnel, space, facilities) required to meet these targets -Long term (2-5 years)

Market Share

Defines whether a business unit has a larger or smaller share than its competitors

Strategic Goals (Official Goals)

Descries where the org wants to be in the future -pertains to the whole org

Crisis Prevention

Detect warning signs of potential crises-build relationships with employees

True or False: When using a focus strategy, a company tries to create a product that will appeal to the broadest possible customer base

False

Business Growth Rate

How rapidly the entire industry is increasing

Scenario Building

Looks at current trends & discontinues & visualizing future possibilities -Forces managers to rehearse mentally what they would do if their plans collapse

Mission

Org's reason for existence -Describes values, aspirations, & reason for being

Internal Strengths & Weaknesses

Strengths: positive internal characteristics that the org can exploit to achieve its strategic performance goals Weaknesses: Internal characteristics that might inhibit or restrict the org's performance

Management By Means (MBM)

focuses attention on the methods and processes used to achieve goals -Focuses people on considering the means rather than just on reaching the goals

Coalitional Management

involves building an alliance of people who support a manager's goals & can influence others to accept & work towards them -Necessary when managers don't agree on the same goal

Operational Goals

results expected from departments, work groups, and individuals -used by managers to direct employees & resources towards achieving specific outcomes that enable the org to perform efficiently & effectively -precisely defined & measurable