Organizational Management (Chapter 3)

Groups of concerned citizens who band together to try to influence the business practices of specific industries, businesses, and professions.

Advocacy Groups

Because economic statistics can be such poor predictors, some managers try to predict future economic activity by keeping track of __________________.

Business Confidence

An environment in which the rate of change is fast

Dynamic Environment

True/False: Opportunistic behavior between buyers and suppliers will be completely eliminated.

False (will never)

Visible artifacts, tangible things that have have impact, things that speak volumes, but do not "speak"

Material Symbols

What type of Advocacy Group do PETA's actions represent?

Media Advocacy

A higher degree of buyer or seller dependence can lead to ________________.

Opportunistic Behavior

Stories told by organizational members to make sense of organizational events and changes and to emphasize culturally consistent assumptions, decisions, and actions

Organizational Stories

The degree to which managers focus on results or outcomes rather than on the techniques and processes used to achieve those outcomes

Outcome Orientation

In contrast to general environments that indirectly influence organizations, changes in an organization's ____________ environment directly affect the way a company conducts its business.

Specific

The customers, competitors, suppliers, industry regulations, and advocacy groups that are unique to an industry and directly affect how a company does business

Specific Environment

An environment in which the rate of change is slow

Stable Environment

What is one reactive customer monitoring strategy?

To listen closely to customer complaints and respond to customer concerns

What does the difference between business success and failure often come down to?

Whether your company is doing a better job of satisfying customer wants and needs than the competiton

What are 5 dimensions of culture?

-Innovation, risk taking, and aggressive -Attention to detail -Outcome orientation -People orientation -Team orientation

What are 2 characteristics of organizational rituals?

-Organization language -Material symbols

What are 2 characteristics of the company founder?

-Organizational stories -Organizational heroes

What are 2 examples of technology outputs?

-Products -Services

What 3 categories do customer responses fall into?

-Promoters -Passives -Detractors

What are 3 types of techniques Advocacy Groups use to try to influence companies?

-Public Communications -Media Advocacy -Product Boycotts

What are 2 examples of technology inputs?

-Raw materials -Information

What are the 2 basic strategies for monitoring customers?

-Reactive customer monitoring -Proactive customer monitoring

What are the 4 components of the General Environment?

-Sociocultural trends -Technology trends -Economy -Political/Legal trends

How are values, attitudes, and beliefs sustained in organizational cultures? (2)

-Stories -Heroes

What are 2 mistakes managers tend to make when they do their competitive analysis?

-They tend to focus on only two or three well-known competition with similar goals and resources -They underestimate potential competitors' capabilities

The degree to which employees are expected to exhibit precision, analysis, and attention to detail

Attention to Detail

Why are Internal Environments important?

Because they affect what people think, feel, and do at work

Why do managers prefer business confidence indices to economic statistics?

Because they know that other managers make business decisions that are in line with their expectations concerning the economy's futures

How do companies keep a close track of what their competitors are doing?

Competitive Analysis

Regulations and rules that govern the business practices and procedures of specific industries, businesses, and professions

Industry Regulation

The degree to which employees are encouraged to be innovative and take risks

Innovation, Risk Taking, and Aggressive

The events and trends inside an organization that affect management, employees, and organizational culture

Internal Environment

The degree to which management decisions take into consideration the effect on people within the organization

People Orientation

The theory that companies go through long periods of stability (equilibrium), followed by short periods of dynamic, fundamental change (revolutionary periods), and then a new equilibrium

Punctuated Equilibrium Theory

Involves identifying and addressing customer trends and problems AFTER they occur

Reactive Customer Monitoring

The establishment of mutually beneficial, long-term exchanges between buyers and suppliers

Relationship Behavior

The abundance or shortage of critical organizational resources in an organization's external environment

Resource Scarcity

Refers to the demographic characteristics, general behavior, attitudes, and beliefs of people in a particular society

Sociocultural Component

The degree to which work activities are organized around teams rather than individuals

Team Orientation

The knowledge, tools, and techniques used to transform inputs into outputs

Technology

True/False: Changes in any sector of the general environment eventually affect most organizations.

True

True/False: In recent years, news laws and regulations have imposed additional responsibilities on companies. Unfortunately, many managers are unaware of these new responsibilities.

True

True/False: Overall, the number and cost of federal regulations has nearly tripled in the last 25 years.

True

True/False: the Dairy industry is a good example of a relatively simple external environment.

True

True/False: the culture at Foxconn pays attention to detail.

True

Extent to which managers can understand or predict which environment changes and trends will affect their businesses

Uncertainty

What are 2 ways sociocultural changes and trends influence organizations?

-Changes in demographic characteristics affect how companies staff their businesses -Sociocultural changes in behavior, attitudes, and beliefs affect the demand for a business's products and services

What are the 5 components of the Specific Environment?

-Customer -Competitor -Supplier -Industry Regulation -Advocacy Group

What are 4 characteristics of changing External Environments?

-Environmental change -Environmental complexity -Resource scarcity -Uncertainty

Indices that show managers' level of confidence about future business growth

Business Confidence Indices

The degree to which a supplier relies on a buyer because of the importance of that buyer to the supplier and the difficulty of finding other buyers for its products

Buyer Dependence

How do regulatory agencies affect businesses?

By creating and enforcing rules and regulations to protect consumers, workers, or society as a whole

A process of monitoring the competition that involves identifying competition, anticipating their moves, and determining their strengths and weaknesses

Competitive Analysis

Companies in the same industry that sell similar products or services to customers

Competitors

An environment with many environmental factors

Complex Environment

The rate at which a company's general and specific environments change

Environmental Change

The number and the intensity of external factors in the environment that affect organizations

Environmental Complexity

All events outside a company that have the potential to influence or affect it

External Environments

True/False: Today, with traffic congestion creating longer commutes and with both parents working longer hours, employees are much less likely to value products and services that allow them to recapture free time with their families.

False (more likely)

True/False: Like the industry regulation component of the specific environment, advocacy groups can force organizations to change their practices.

False (unlike industry regulation; cannot force organizations to change practices)

The economic, technological, sociocultural, and political/legal tends that indirectly affect all organizations

General Environment

In a __________ economy, more people are working and have more money to spend; provides an environment favorable to business growth.

Growing

An advocacy group tactic that involves framing issues as public issues; exposing questionable, exploitative, or unethical practices; and obtaining media coverage by buying media time or creating controversy that is likely to receive extensive news coverage.

Media Advocacy

A transaction in which one party in the relationship benefits at the expense of the other

Opportunistic Behavior

The values, beliefs, and attitudes shared by organizational members

Organizational Culture

What is the most important part of the Internal Environment?

Organizational Culture

People celebrated for their qualities and achievements within an organization

Organizational Heroes

This component of the general environment includes the legislation, regulations, and court decisions that govern and regulate business behavior

Political/Legal Component

From a managerial's perspective, what is the best medicine against legal risk?

Prevention

Involves identifying and addressing customer needs, trends, and issues BEFORE they occur

Proactive Customer Monitoring

An advocacy group tactic that involves protesting a company's actions by persuading consumers not to purchase its product or service

Product Boycott

An advocacy group tactic that relies on voluntary participation by the news media and the advertising industry to get the advocacy group's message out

Public Communiciations

In a __________ economy, consumers have less money to spend, and relatively fewer products, making growth for individual businesses more difficult.

Shrinking

An environment with few environmental factors

Simple Environment

The degree to which a company relies on a supplier because of the importance of the supplier's product to the company and the difficulty of finding other sources of that product

Supplier Dependence

Companies that provide material, human, financial, and informational resources to other competitors

Suppliers