MGT 8803 BUSINESS STRATEGY UPDATED
ACTUAL QUESTIONS AND CORRECT
ANSWERS
●● External Context for Planning
Answer: regulators | partners & shareholders | competitors | suppliers |
tech, econ, labor, society | communities | customers
●● Internal Context for Planning
Answer: mgt's vision | mission/values | culture | people & workforce
diversity | technology | physical assets | intellectual property
●● Planning is important because it...
Answer: 1. provides direction & basis for coordination
2. minimize waste & redundancy
3. reduces uncertainty
4. establishes goals
5. involves & engages all levels of firm
●● Residual Uncertainty
Answer: the unknowable; uncertainty that remains...important in
assessing risk
,●● Hierarchical (Tall) Organizational Structure
Answer: many layers of middle mgt | senior mgrs make most operational
decisions | information flows from top-down | stable environment
●● Flat (Networked) Organizational Structure
Answer: front-line employees empowered to make decisions |
information flows top-down AND bottom-up | few levels of middle mgt |
decentralized decision making | dynamic environment
●● Strategic Plans
Answer: 1. broadly impacts firm
2. new markets to enter or existing to leave
3. concerns overall scope of firm
4. identifies initiative to create & sustain competitive advantage
5. driven by mgt's vision, mission, values
●● Functional Plans
Answer: 1. implementing strategic plans
2. interrelated
3. aligned to business unit level planning
4. shorter term
5. drive budget development & staffing plans
,●● Tactical/Operations Plans
Answer: 1. narrow, specific to firm
2. allocation of specific resources to specific tasks or operations
●● SMART
Answer: Specific, Measurable, Attainable, Realistic, Timely
●● Main objective of business strategy
Answer: achieve superior performance in marketplace
●● Strategy
Answer: goal-directed actions a firm takes to gain & sustain superior
performance relative to competitors.
●● Competitive advantage
Answer: superior performance relative to other competitors in same
industry OR industry average | temporary
*people prefer your brand over another's so they are willing to pay more
(ie, Apple)
●● Elements of Good Business Strategy
Answer: 1. diagnosis of competitive challenge
, 2. guiding policy to address competitive challenge
3. set of coherent actions to implement
●● Cost Leadership
Answer: lowest-cost producer in industry | pricing at or below industry
avg while leveraging a low "cost" advantage
●● Differentiation
Answer: economic value created is greater than competitors | uniqueness
in an industry with broad market | making products unique to allow
charging premium price
●● How Tesla does Differentiation
Answer: battery technology, autonomous driving, high performance,
supercharger network, wow factor
●● Focus strategy
Answer: establish either a cost leadership OR differentiation competitive
advantage but focused in a narrow market segment (ex: Rolex, Louis
Vuitton)
●● Vision
Answer: mgt's description of business model, technology, workforce,
strategic positioning, and goals | for inspiring employees & stakeholders
ACTUAL QUESTIONS AND CORRECT
ANSWERS
●● External Context for Planning
Answer: regulators | partners & shareholders | competitors | suppliers |
tech, econ, labor, society | communities | customers
●● Internal Context for Planning
Answer: mgt's vision | mission/values | culture | people & workforce
diversity | technology | physical assets | intellectual property
●● Planning is important because it...
Answer: 1. provides direction & basis for coordination
2. minimize waste & redundancy
3. reduces uncertainty
4. establishes goals
5. involves & engages all levels of firm
●● Residual Uncertainty
Answer: the unknowable; uncertainty that remains...important in
assessing risk
,●● Hierarchical (Tall) Organizational Structure
Answer: many layers of middle mgt | senior mgrs make most operational
decisions | information flows from top-down | stable environment
●● Flat (Networked) Organizational Structure
Answer: front-line employees empowered to make decisions |
information flows top-down AND bottom-up | few levels of middle mgt |
decentralized decision making | dynamic environment
●● Strategic Plans
Answer: 1. broadly impacts firm
2. new markets to enter or existing to leave
3. concerns overall scope of firm
4. identifies initiative to create & sustain competitive advantage
5. driven by mgt's vision, mission, values
●● Functional Plans
Answer: 1. implementing strategic plans
2. interrelated
3. aligned to business unit level planning
4. shorter term
5. drive budget development & staffing plans
,●● Tactical/Operations Plans
Answer: 1. narrow, specific to firm
2. allocation of specific resources to specific tasks or operations
●● SMART
Answer: Specific, Measurable, Attainable, Realistic, Timely
●● Main objective of business strategy
Answer: achieve superior performance in marketplace
●● Strategy
Answer: goal-directed actions a firm takes to gain & sustain superior
performance relative to competitors.
●● Competitive advantage
Answer: superior performance relative to other competitors in same
industry OR industry average | temporary
*people prefer your brand over another's so they are willing to pay more
(ie, Apple)
●● Elements of Good Business Strategy
Answer: 1. diagnosis of competitive challenge
, 2. guiding policy to address competitive challenge
3. set of coherent actions to implement
●● Cost Leadership
Answer: lowest-cost producer in industry | pricing at or below industry
avg while leveraging a low "cost" advantage
●● Differentiation
Answer: economic value created is greater than competitors | uniqueness
in an industry with broad market | making products unique to allow
charging premium price
●● How Tesla does Differentiation
Answer: battery technology, autonomous driving, high performance,
supercharger network, wow factor
●● Focus strategy
Answer: establish either a cost leadership OR differentiation competitive
advantage but focused in a narrow market segment (ex: Rolex, Louis
Vuitton)
●● Vision
Answer: mgt's description of business model, technology, workforce,
strategic positioning, and goals | for inspiring employees & stakeholders
