BUS 189 - Chapter 1

Strategy

A set of related actions that managers take to increase their company's performance.

Values

A statement of how employees should conduct themselves and their business to help achieve the company mission.

Risk Capital

Equity capital for which there is no guarantee that stockholders will ever recoup their investment or ear a decent return.

Corporate Level Managers

Individuals such as the CEO, other senior executives, and corporate staff that occupy the apex of decision making within the organization.

Functional Managers

Managers responsible for supervising a particular function, that is, a task, activity, or operation, such as accounting, marketing, research and development (R&D), information technology, or logistics.

Strategy Implementation

Putting strategies into action.

Shareholder Value

Returns that shareholders earn from purchasing shares in a company.

Strategy Formulation

Selecting strategies based on analysis of an organization's external and internal environment.

SWOT

Strengths, weaknesses, opportunities, and threats.

Cognitive Biases

Systematic errors in human decision making that arise from the way people process information.

Competitive Advantage

The achieved advantage over rivals when a company's profitability is greater than the average profitability of firms in its industry.

Vision Statement

The articulation of a company's desired achievements or future state.

Business Model

The conception of how strategies should work together as a whole to enable the company to achieve competitive advantage.

Mission Statement

The purpose of the company, or a statement of what the company strives to do.

Business Level Managers

The strategic role of these managers is to translate the general statements of direction and intent that come from the corporate level into concrete strategies for individual businesses.