MBA 706 Exam Study Guide 2
What is the definition of a mission? - answerUnique purpose that distinguishes the
organization from other companies and defines the boundaries of its operations
What does a mission do? - answerProclamation of organizations primary objective that
encapsulates its core values
What should a mission do? - answerCharacterize the organization's principles and
priorities and define the broad product, market, and technologies that are core to the
business.
A Mission should define the boundaries of business' ambitions: - answerProduct Scope
Market Scope
Geographical Scope
T/F A mission may also encompass the organizations strategic intent or vision? -
answerTRUE
Can a mission act as a guide and lead to the development of hierarchy of objectives? -
answerYes
What should a mission accurately describe? - answerThe: Business,
The: Market it serves
The: organizations capabilities
What can influence an organizations mission? - answer1. Corporate governance: who
SHOULD we serve /accountability
2. Stakeholders - who DO we serve/ balance of power
3. Business Ethics - social responsibility / expectations
4. Cultural Context - Aspects of mission are priority / influence of cultural environment
What is a broad mission statement? - answer- Fairly Common, generally refers to all
stakeholders in the business
EX) Scottish Power "highly rated utility-based company in related markets.. provide
excellent quality.. service to customers.. returns to investors"
What are some pros & cons of a broad mission statement? - answerPros- addresses
the problem of too narrow of a focus
Cons- Can fail to clearly define core market & product areas
What is a narrow focus mission statement? - answerExample: Newport News
Shipbuilding "we build good ships"
, What are some pros & cons of a narrow focus mission statement? - answerPros: Very
clear description of the organizations primary business
Cons: May set unnecessary constraints on the company's activities
What are characteristics of a successful mission statement? - answer1. Credibility
2. Uniqueness
3. Specific capabilities
4. Aspirational
**Also need to define the scope: Product, market, geographical*
What are SMART goals? *Can be both short & long term - answerSpecific
Measurable
Aspirational / Achievable
Realistic
Time Scales / Timely
What are characteristics of successful objectives? - answerAcceptability
Flexibility
Comprehensibility
What is the hierarchy of objectives? - answerCorporate - over 3 years: organizations
overall direction in term of growth / i.e. increase profit by 30%
Functional - over 3 years: Marketing, finance, HR, ops - Departments direction in terms
of growth / i.e. 25% increase in marketing share
Operational - 1-3 years: marketing mix (product, service, promotion) Marketing strategy
becomes the objective
Sometimes SBU - level also if org has a divisional structure
What is the balanced scorecard? - answerRequires managers to look at business from
4 key perspectives:
1. Customer - satisfaction via surveys
2. Internal - marketing, manufacturing, logistics, quality
3. Innovation / learning - time to market, continuous improvement
4. Financial - ROI, cash flow, yearly performance
What are some key areas w/in which organizations should develop objectives (Drucker)
- answer- Market standing
- innovation
- productivity
- physical & financial resources
- profitability
What is the definition of a mission? - answerUnique purpose that distinguishes the
organization from other companies and defines the boundaries of its operations
What does a mission do? - answerProclamation of organizations primary objective that
encapsulates its core values
What should a mission do? - answerCharacterize the organization's principles and
priorities and define the broad product, market, and technologies that are core to the
business.
A Mission should define the boundaries of business' ambitions: - answerProduct Scope
Market Scope
Geographical Scope
T/F A mission may also encompass the organizations strategic intent or vision? -
answerTRUE
Can a mission act as a guide and lead to the development of hierarchy of objectives? -
answerYes
What should a mission accurately describe? - answerThe: Business,
The: Market it serves
The: organizations capabilities
What can influence an organizations mission? - answer1. Corporate governance: who
SHOULD we serve /accountability
2. Stakeholders - who DO we serve/ balance of power
3. Business Ethics - social responsibility / expectations
4. Cultural Context - Aspects of mission are priority / influence of cultural environment
What is a broad mission statement? - answer- Fairly Common, generally refers to all
stakeholders in the business
EX) Scottish Power "highly rated utility-based company in related markets.. provide
excellent quality.. service to customers.. returns to investors"
What are some pros & cons of a broad mission statement? - answerPros- addresses
the problem of too narrow of a focus
Cons- Can fail to clearly define core market & product areas
What is a narrow focus mission statement? - answerExample: Newport News
Shipbuilding "we build good ships"
, What are some pros & cons of a narrow focus mission statement? - answerPros: Very
clear description of the organizations primary business
Cons: May set unnecessary constraints on the company's activities
What are characteristics of a successful mission statement? - answer1. Credibility
2. Uniqueness
3. Specific capabilities
4. Aspirational
**Also need to define the scope: Product, market, geographical*
What are SMART goals? *Can be both short & long term - answerSpecific
Measurable
Aspirational / Achievable
Realistic
Time Scales / Timely
What are characteristics of successful objectives? - answerAcceptability
Flexibility
Comprehensibility
What is the hierarchy of objectives? - answerCorporate - over 3 years: organizations
overall direction in term of growth / i.e. increase profit by 30%
Functional - over 3 years: Marketing, finance, HR, ops - Departments direction in terms
of growth / i.e. 25% increase in marketing share
Operational - 1-3 years: marketing mix (product, service, promotion) Marketing strategy
becomes the objective
Sometimes SBU - level also if org has a divisional structure
What is the balanced scorecard? - answerRequires managers to look at business from
4 key perspectives:
1. Customer - satisfaction via surveys
2. Internal - marketing, manufacturing, logistics, quality
3. Innovation / learning - time to market, continuous improvement
4. Financial - ROI, cash flow, yearly performance
What are some key areas w/in which organizations should develop objectives (Drucker)
- answer- Market standing
- innovation
- productivity
- physical & financial resources
- profitability
