Chapter 3

Strategic issues are

"events or forces either inside or outside an organization that are likely to alter its ability to achieve its objectives."

Supply Chain

A network of multiple businesses and individuals that are connected through the flow of products or services.

Suppliers

Provide the raw materials that the organization uses to produce its output.

Hero

a figure who exemplifies the deeds, character, and attributes of a strong culture.

Merger

occurs when two or more organizations com- bine to become one.

Involvement culture

Emphasizes an internal focus on the participation of employees to adapt rapidly to changing needs from the environment.

Slogan

a phrase or sentence that succinctly expresses a key corporate value.

Task Environment

is 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.

consistency culture

Uses an internal focus and a consistency orientation for a stable environment.

Internal Environment

which includes the elements within the organization's boundaries. The internal 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.

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.

Customers

Those people and organizations in the environment that acquire goods or services from the organization

high-performance culture,

a culture that (1) is based on a solid organizational mission or purpose, (2) embodies shared adap- tive values that guide decisions and business practices, and (3) en- courages individual employee ownership of both bottom-line results and the organization's cultural backbone.7

ceremony is

a planned activity at a special event that is conducted for the benefit of an audience.

General Environment

affects organizations indirectly. It includes social, economic, legal-political, international, natural, and technological factors that influence all organizations about equally.

adaptability culture

emerges in an environment that requires fast response and high- risk decision making.

The external organizational environment

includes 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.

Organizational Ecosystem

is 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. -For example, 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.

Labor Market

represents people in the environment who can be hired to work for the organization.

culture

set of key values, beliefs, understandings, and norms shared by members of an organization.

The dimensions of the general environment include:

International, technological, sociocultural, economic, legal-political, and natural. 1. *International Dimension* of the external environment, which includes events originating in foreign countries, as well as new opportunities for U.S. companies in other countries. The international environment provides new competitors, customers, and suppliers and shapes social, technological, and economic trends as well. 2. *Technological Dimension* of the general environment includes scientific and technological advancements in a specific industry, as well as in society at large. 3. *Sociocultural Dimension* of the general environment represents the demographic characteristics, norms, customs, and values of the general population. Important sociocultural characteristics are geographical distribution and population density, age, and education levels. 4. *Economic Dimension* 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 organization's economic environment. 5. *Legal-political Dimension* includes government regulations at the local, state, and federal levels, as well as political activities designed to influence company behavior. 6. *Natural Dimension* includes all elements that occur naturally on Earth, including plants, animals, rocks, and resources such as air, water, and climate.

Competitors

Organizations in the same industry or type of business that provide goods or services to the same set of customers

Task Environment includes those sectors that have a direct working relationship with the organization:

Among them customers, competitors, suppliers, and the labor market. 1. *Customers* are the people and organizations in the environment that acquire goods or services from the organization. 2. *Competitors* are organizations in the same industry or type of business that provide goods or services to the same set of customers. 3. *Suppliers* provide the raw materials that the organization uses to produce its output. 4. *Supply Chain* is a network of multiple businesses and individuals that are connected through the flow of products or services. 5. *Labor Market* represents people in the environment who can be hired to work for the organization.

Joint Venture

Involves a strategic alliance or program by two or more organizations. A joint venture typically occurs when a project is too complex, expensive, or uncertain for one firm to handle alone.

symbol

an object, act, or event that conveys meaning to others. Symbols can be considered a rich, nonverbal language that vibrantly conveys the organization's important val- ues concerning how people relate to one another and interact with the environment.

cultural leader

defines and uses signals and symbols to influence corporate culture. The leader clarifies what the new culture should be and crafts a story that inspires people to change. A cultural leader is the "chief marketing officer" for the desired cultural values.81 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.

story is a

narrative based on true events that is repeated frequently and shared among organizational employees. S

boundary spanning

links to and coordinates the organization with key elements in the external environment. One area of boundary spanning is the use of business intelligence, which results from using sophisticated software to search through internal and external data to spot patterns, trends, and relationships that might be significant. Th

Environmental Uncertainty

means that managers do not have sufficient information about environmental factors to understand and predict environmental needs and changes.