MANAGEMENT 309 EXAM 2

what are some ways that organizations diversify?

- acquisition or merger - backward integration (makes its own supplies) - forward integration (selling work to the customers of their customers)

there are five principles of the EBM (evidence based management) system, they are...

- building an organizational culture that is safe to tell the truth - commit to decision making on the best evidence available - avoid relying on personal opinion or past experience - encourage experimentation - critically examine the recommendations for downsides so basically encourage creativity with no wrong answers and focus on finding evidence based recommendations that have little downsides

what are the advantages of diversifying to international business (there are 3)

- global efficiencies (choose from locations anywhere in the world) - multi-market flexibility (responding to change in one country by altering operations in another) - worldwide learning (learn different things in the different places they operate and manage; transfer this knowledge to the whole organization)

what are the two main advantages of unrelated diversisfication?

- if one business is doing badly the other might be doing well - optimize resource allocation

what are the 5 aspects of human behavior that impact decisions?

- intuition - escalation of commitment - coalition - risk propensity - ethics

what are the three types of standing plans (plans that are used repeatedly in an organization)

- policy - rules of regulation - standard operating procedures

facilities decisions

-facilities are the physical locations where products or services are created, stored, and distributed

A manager is using Miles and Snow's defender strategy. What action is the manager likely to take? 1. Reward employees for finding ways to cut costs. 2. Balance resource allocation between cost control and innovation. 3. Encourage creativity by allowing lower-level employees to make decisions.

1 they are seeking to maintain or improve current products performance rather than seeking new opportunities

If an organization is following Porter's focus strategy, what should its managers decide to do? 1. Determine what a subset of customers desires and tailor a product to them. 2. Make no-frills products at low cost and advertise low prices. 3. Make products with desirable features and advertise these features.

1 - identifies a focus

A CEO is using Porter's overall cost leadership strategy. What course of action is the manager likely to take? Choose all that apply. 1. Drive the value of efficiency throughout the organizational culture so that employees are highly cost-conscious. 2. Direct the finance team to ensure that innovation gets sufficient funding. 3. Direct manufacturing to standardize production so many products can be made at low cost. 4. Direct product designers to consider how products can be inexpensively made.

1, 3, 4

1. Identify the time needed for different steps of the plan (develop or execute) 2. Monitor communication across work groups (develop or execute) 3. Understanding the organization's tactical goals (develop or execute)

1. develop 2. execute 3. develop

what are the 4 action points of the planning process?

1. develop the plan and consider contingency events 2. implement the plan and formally identify contingency events 3. specify indicators for the contingency events and develop plans for each possible event 4. successfully complete plan or contingency plan

what are the four steps to decision making?

1. identifying there's a decision to be made 2. identifying alternatives 3. choosing the most effective alternative 4. putting the decision into effect

Identify a contingency event that would be highly disruptive which action point?

2

Based on experience, the manager has confidence in the ability of her best representatives to deal with upset customers. At the same time, she is concerned that discounts would cost the company too much money. She decides to set up a workflow that routes upset customers to select representatives. which step in the decision making process is this?

3

which method of managing diversification rates businesses by their market share and growth rate of that market? (stars, cash cows, dogs, question marks)

BCG matrix related to implementing corporate level strategies (because they are concerned with diversification)

CAD stands for what and takes away the need for what to be created? how is this different from CAM?

Computer Aided Design prototypes computer aided manufacturing (ensures the design moves smoothly to production)

what method of group decision making involves allowing experts to individually contribute their ideas and then determining the average opinion?

Delphi group method

A list of the steps a supervisor should follow when an employee calls in sick policy SOP rules and regulations

SOP always involves steps to be followed

the purpose of what is to formulate strategies that support the mission (fundamental purpose) of an organization

SWOT analysis

what are three thins that make a good strategy/ what is the ultimate best case scenerio regarding swot analysis?

a strategy that supports the mission, exploits the organizations strengths and opportunities avoids weaknesses neutralizes threats

the problems, challenges, and opportunities faced by operations managers revolve around the __________________ and __________________ of resources for conversion

acquisition utilization

Finish implementing the original plan which action point?

action point 4

which model of decision making describes what ACTUALLY happens

administrative model

define strategy and strategic management

an organization's strategy is a comprehensive plan that describes the set of alternatives from which an organization chooses as it achieves its goals strategic management is a thorough and ongoing process for developing and implementing strategies

a firm that falls between both the prospective and defender strategies and seeks new opportunities while guarding the products it has is utilizing an __________ strategy

analyzer

what are the six steps of the classical decision model? what is it all based on?

based on a stimulus (some new event or information) 1. recognize and define the situation 2. identify alternatives 3. evaluate the alternative 4. choose the best alternative 5. implement the chosen alternative 6. evaluate the results

what are the three conditions under which decisions are made?

certainty (knowing all alternatives and their probable outcomes) uncertainty (knowing none of the alternatives or risks or outcomes) risk (availability of alternatives and their pros and cons)

what describes the steps that managers SHOULD take when faced with a situation (rational decision making)

classical decision model

In a school, several teachers might jointly decide they would like to implement an interdisciplinary curriculum and then approach more teachers and school officials to gain support for their idea. this is an example of what aspect of human behavior as it relates to decision making

coalition

The factors that determine _______________ (competitive position or attractiveness) are similar to the organizational strengths and weaknesses in SWOT analysis. •The factors that determine ________________ (competitive position or attractiveness) are similar to the environmental opportunities and threats in SWOT analysis.

competitive position attractiveness

when an organization is involved in multiple businesses and or markets and must understand how to manage various lines of business. These are decisions that are needed in the ______________ strategy

corporate

What is the idea of bounded rationality?

decision makers are influenced by values, unconscious reflexes, skills, and habits

the following are all _______________ to formal goal setting •Failure due to lack of top management support •Emphasis on quantitative goals and plans at the expense of qualitative ones •Excessive record keeping requirements •Lack of ability to involve subordinates in the process, resulting in no true collaboration

disadvantages

if a technology company designs software with a better user interface (UI) than competing software, it has a ___________________ __________________ in UI.

distinctive competence

an organization has a sustained competitive advantage when its ________ ___________________ cannot be imitated

distinctive competency (something that only a few organizations have that provides a competitive advantage)

when did automative factories begin and what are the four parts of all automation?

during WORLD WAR II sensors, information, control, feedback (think thermostat)

more jobs will be lost then added with all of the new automation in the long term true or false

false

the presence and competitiveness of US manufactoring has always been present and dominated since the industrial revolution true or false

false in the 1970s the US grew complacent to foreign competition and fell behind. we are doing well now however

strengths and weakness are part of the external analysis of SWOT true or false

false that is the opportunities and threats

an aircraft manufacturer is likely to use which kind of layout? cellular fixed position product process

fixed-position you can't move something as big and complex as an airplane

sales continue to be high but now other competitors have entered the market and the managers focus is now to differentiate their product introduction growth maturity decline

growth

developing tactical plans works closely with strategic plans and tactical goals and focuses more on

identifying all the resources (time and people) needed

the disadvantages of forming a coalition and political processes among some members of the group are most commonly associated with which method of group decision making

interacting group/ team

what is the biggest downside to unrelated diversification that makes these businesses not very successful?

managers are not able to know enough about all of the businesses

The Goodyear Tire & Rubber Company practices ________________because it combines rubber and chemical compounds and uses blending equipment and molding machines to create tires.

maufactoring

___________________ management is the set of managerial activities used by an organization to transform resource inputs into products and services

operations when a pizza hut employee orders food and paper then combines it all to create a pizza they are engaging in operations management

Advertising that highlights low prices is communicating this strategy to consumers. (overall cost leadership focus strategy differentiation strategy)

overall cost leadership

strategy focuses on resources, environment, mission, while tactical plans primarily focus on __________ and ______________________

people and action

A statement defining how an organization handles employee sick days policy SOP rules and regulations

policy how an organization would respond to a given situation

A natural starting point in designing operations systems is determining the ___________-____________ mix

product-service mix determined largely by business and corporate strategies how many and what kinds to offer

what did the entire area of operations management used to be called?

production operations because it all centered around manufactoring

Deserving sufficient investment to maintain its competitiveness winner loser profit producer

profit producer

short term plans include projects and programs. a ______________ would develop the web pages that allow customers to learn about and purchase the new product.

project a program would focus on developing the actual product

in the framework designed by miles and snow, business level strategies are classified as _____________ ________________ __________________ or ____________

prospective, reactive, analytic, or defensive

A decentralized organizational structure, in which decision making occurs lower in the organization, is often used to support creativity and adaptability. This is important for the ___________ strategy of the miles and snow typology

prospector

manager operating with no clear guiding strategy are said to be using the ________________ strategy and their business will likely not perform well

reactor

what are some disadvantages of CAD, CAM, CIM AND FSM?

resistance not always reliable due to complexity super expensive

A requirement that unhappy customers never be given cash refunds policy sop rules and regulations

rules and regulations how specific activities must be carried out

when a manager stops looking for alternatives and goes with one that is good enough it is called

satisfying and is a part of the administrative model

Economies of ___________ are realized by using one facility to serve customers in more than one country. Economies of __________ are achieved by broadening the product line in each country.

scale scope

banks (specifically being able to deposit checks and pay bills virtually) are a good example of what type of technology?

service

When top managers develop ______________ plans, they primarily discuss resource allocation, competitive advantage, and synergies between different parts of the organization.

strategic

what are the two models used to manage diversification?

the BCG matrix or the GE business screen

What are SBU's (Strategic Business Units)?

the different businesses or sets of related businesses that an organization operates

location

the physical positioning or geographic site of facilities and must be determined by the needs and requirements of the organization

technology in terms of organizations is

the set of processes and systems used to convert resources to products or services

what is the main difference between a nominal group and an interacting group?

they both meet face to face but they do not initially freely discuss alternatives that they think of and there is a vote in the nominal group

having only one supplier is an example of? (SWOT)

threat

what is the goal and purpose of management of objectives?

to give managers at all levels a voice in formulating goals and plans

service organizations do what? what type of utility do they create for their customers?

turn resources into intangible outputs time or place utility

there can be different kinds of value and __________ created by organizations operation management harley davidson motorcycles versus delta airlines departure program

utility operations of putting together a motorcycle creates value and provides physical utility by combining dissimilar parts

what is the order of tactical goals, operational goals, and strategic goals in the planning and decision making process?

strategic tactical operational

what does SWOT stand for?

strengths weaknesses opportunities threats

_____________goals are set by and for middle managers to increase market share, we will add desirable features to our products each year for the next three years

tactical

there is the highest chance of making a poor decision in conditions of ____

uncertainty

is having little cash to pay the bills for your organization a weakness or a threat?

weakness threats are from the external environment and limit the organization's ability to achieve its goal

an example of a barrier that must be overcome with planning and setting goals that involves unrealistic goals or goals that conflict with eachother

inappropriate

the GE business screen is more sophisticated than the BCG matrix and considers...

industry attractiveness and competitive position

Certain individuals in an organization have the authority and responsibility to perform tasks such as budgeting and carrying out plans. What term is used to refer to these people? Planning staff Middle managers Line managers Top managers

line managers

the company begins to look for ways to cut costs and to innovate elsewhere during what stage? introduction growth maturity decline

maturity

A corporation allows units in different countries to operate independently, letting the unit managers make many decisions. Which strategy is it using? Global strategy Home replication strategy Multidomestic strategy Transnational strategy

multi domestic transnational is a combination of multidomestic and global global is viewing the world as a single market home replication is just copying what is already done

what is supply chain management?

the process of managing operations control, resource acquisition and purchasing, and inventory so as to improve overall efficiency and effectiveness

When managers decide what the organization's strategy is, they are engaged in strategy ____________. Strategy ___________________ refers to the methods used to execute the strategy

formulation implementation

The manager understands the availability of each alternative and the probability that each will have the desired outcome. uncertainty, risk, or certainty

risk

to increase market share by 10 percent each year for the next three years example of what type of goal that is broad in scope?

strategic

interacting group/team delphi group nominal group are all commonly used methods for...

group or team decision making

_______________ is often based on experience and thus can be an excellent guide to decision making as long as it is checked by evidence, especially when the stakes are high.

intuition

a contingency plan may include ________________ management which is the set of procedures the organizations uses to respond to a disaster that disrupts existing plans

crisis management examples: hurricane, earthquake, civil unrest

What term is used to refer to the reconciliation of competing goals?

optimizing

A favorable regulatory environment for the organization's industry is an example of? (SWOT)

opportunity

Consider whether a political revolution could disrupt operations. which action point

action point 1 considers the possibility of the a contingent plan

Consider whether a natural disaster could disrupt operations. which action point?

action point 1 identifying possible contingencies

to formulate strategies at the business level, there are three main frameworks. what are they?

porter's generic strategies miles and snow typology the product life cycle model

what are 4 things that encompass an organizations mission?

purpose value direction premises

what are some advantages to group decision making

•More information and knowledge are available. •More alternatives are likely to be generated. •The final decision is more likely to be accepted by stakeholders. •The final decision may be communicated more effectively. •Better decisions generally emerge.

an _____________ __________________ aligns the organization with its environment and positions it to achieve strategic goals

effective strategy

Sometimes the environment changes suddenly, and managers need to develop a strategy to achieve an unanticipated goal. What is this type of strategy called?

emergent

A CEO invests in starting a new business that fails to attract customers. The CEO persists in believing that investing more money will eventually turn the business around. Which behavior is the CEO demonstrating?

escalation of commitment

By not recognizing her______________________________, Debbie repeatedly took her 8-year-old laptop for repairs, even though the repair costs were greater than the price of a brand-new, faster laptop with much more memory.

escalation of commitment

A manager's __________ influence whether they act in the interests of the organization or their own interests when these are in conflict.

ethics

what are the three main advantages of related diversification?

- reducing the dependence on any one business - reducing overhead through the efficiency of shared functions - increasing the organization's ability to use its strengths to pursue opportunities in more than one business (SYNERGY)

Which of the following technologies is specifically developed to move designs into production? Computer-integrated manufacturing (CIM) Flexible manufacturing systems (FMS) Computer-aided manufacturing (CAM) Computer-aided design (CAD)

CAM

When the level of rivalry, the power of suppliers and buyers, and the threat of substitutes and new entrants are high, an organization finds _________ (many or few) opportunities and faces _______ (many or few) threats.

few many

what are the three principles of administrative management? what does it define as the reality of decision making?

- the use of incomplete and imperfect information - constrained by bounded rationality - tend to satisfice the final decision may or may not be in the best interests of the organization

what are the three different types of layouts an organization could have?

1. product layout (good for when large amounts of a single product are needed) 2. process layout (organizations that create or process a variety of products or activities; needs are diagnosed as they come) 3. fixed-position layout (very few large and complex products; people and machines move around one big thing) 4. cellular layout (families of products can follow similar flow paths)

what is CIM

Computer Integrated Manufacturing linked together with CAD AND CAM to enhance complexity and flexibility of scheduling

what type of new technology relies on feedback, information, sensors, and a control mechanism.

automation they work quickly and make few errors which helps them improve products and services and foster innovation

Determining whether to build a factory capable of making 5,000 or 8,000 units per day is a _____________ decision

capacity it involves choosing the amount of products, services, or both that can be produced

what are the three basic components in designing operations systems?

facilities layout location

many of the tools, techniques, and methods that are used in factories are NOT helpful to a service form true or false

false managers of automobile plants and hair salons both have to decide how to design their facilities, identify the best locations for them, determine optimal capacities, make decisions about inventory storage, set procedures for purchasing raw materials, and set standards for productivity and quality.

what is FSM

flexible manufacturing systems that robotic work units or other computer controlled transport systems

what kept the US economy from failing during the decline of the manufacturing sector?

service operations

what are the three main goals of the classical decision model?

to obtain complete and perfect information eliminate uncertainty evaluate everything rationally and logically

Different organizations in the same industry may have different facilities requirements true or false

true

a poorly designed reward system and manager reluctance are two other barriers to overcome when planning and decision making true or false

true

true or false; as managers are promoted to higher-level roles, their decisions become more unprogrammed

true they have to make decisions more quickly and about new things that are less procedural

Graham Holdings Company owns businesses in industries as diverse as television media, digital advertising, education, healthcare services, wood products, and the manufacture of parts used in industrial combustion processes, among many others this organization is functioning under _________ diversification

unrelated diversification

Operational plans are directly based on the

tactical plans and operational goals

the act of choosing one alternative from among a set of alternatives

decision- making

what is the difference between business and corporate level strategies?

business level are concerned with how the organization competes in one market or industry corporate level are active in multiple industries and markets

which is not a step in the decision making process? 1. Choosing the alternative that is likely to be most effective 2. Developing a plan to put the decision into effect 3. Defining jobs to structure the work of enacting the decision 4. Identifying alternative courses of action

3 is not a part of decision making (assigning jobs)

what are some disadvantages of group decision making?

•The process takes longer than individual decision making, so it is costlier. •Compromises resulting from indecisiveness may not represent the best thinking of the group members. •One person may dominate the group. •Groupthink, or people expressing consensus because doing so is easier than disagreeing, may occur

What are the two main types of strategies that managers create/ encounter

deliberate emergent

Advertising that highlights features of a product/service is aimed at creating a perception of high quality is communicating this strategy to consumers. (overall cost leadership focus strategy differentiation strategy)

differentiation strategy focus strategy would be concentrating on a particular region, product, or consumer group

what are the three areas that an effective strategy adresses?

distinctive competence (something that the organization does better then its competitors) scope (type of markets that it is involved with) resource development (how the organization will allocate resources)

______________ makes organizations more resilient, because even if some businesses do worse when the environment changes, others may be unaffected or even do better.

diversification

when implementing corporate level strategies, the key questions they have to first answer are about ___________

diversification if beginning diversification, they need to know how to migrate a single product into a multi business strategy if already diversified, they need to know how to manage that

________________ are businesses with a small share of a market that is stable or declining. A manager will not invest in these and may even divest it. _______________ have a large share of a stable market. They generate high profits without much investment.• _________________ have a large share of a rapidly growing market. Managers use profits from cash cows to invest.• ________________ have only a small market share but are in a rapidly growing market. If they can increase their market share, they have the potential to earn high profits. Managers may use profits from cash cows to invest in question marks as well.

dog cash cows stars question marks

what type of management is a rigorous process of making the best decision possible?

evidence - based management

evaluating how a plan is helping the organization, coordinating activities, monitoring the progress of the plan, and providing resources to carrying out the plan are all part of __________________ (developing or executing) tactical plans

executing

assisting with evaluation and control, motivating, serving as a compass, and being an input to sound planning are all purposes of ____________ in organizations goals plans mission tactics

goals

The organization needs to focus on increasing production while maintaining quality. Managers are hiring more employees and managing inventory and cash flow. introduction growth maturity decline

introduction

aspects of the environment that may allow the organization to achieve greater performance.

organizational opportunities

opportunities and threats can be assessed using the ___________ ________________ ________________ model (hint:5)

porter's five forces model level of competitive rivalry, power of suppliers, power of buyers, threat of substitutes, threat of new entrants

differentiation strategy, overall cost leadership, and focus strategy are all part of which framework for implementing business level strategies?

porter's generic strategies

A large organization operating in multiple different but related businesses, industries, or markets is practicing ________________

related diversification could be related through - similar tech - shared distribution and marketing channels - shared brand name and reputation - shared customers

A financial services company might choose to invest more in retirement planning, invest less in mortgage lending, and withdraw completely from brick-and-mortar retail banking.

resource development