MGMT 5560 Exam 1 Questions with 100%
Correct Answers
5P's of strategy
Plan, Pattern, Ploy, Position, Perspective
Plan
A carefully crafted set of steps that a firm intends to follow in order to be successful
Pattern
A consistent stream of actions
Position
A firm's place in the industry relative to it's competitors
Perspective
How executives and employees view and interpret the competitive landscape around them
Ploy
Specific moves or tactics designed to outwit competitors or manage outsider's impressions
Strategic Management
- an interpretive management field
combines analysis, formulation and implementation in the quest for competitive advantage
Strategy
goal directed actions to gain and sustain superior performance relative to competitors.
Strategy is NOT
,1. grandiose statements
2. failure to face a competitive challenge
3. operational effectiveness, competitive benchmarking or tactical tools
a good strategy is based on 3 elements:
- diagnosis of the competitive challenge: A
- a guiding policy to address the competitive challenge: F
- a set of coherent actions to implement the firm's guiding policy: I
What is the purpose of the AFI framework?
- process by which we engage in doing strategy
competitive advantage
superior performance relative to other competitors in the same industry or the industry
average
- competitive advantage is relative, not absolute
to assess competitive advantage benchmark:
- compare the firm to competitors in the same industry
- compare the firm to the industry average
Sustainable competitive avantage
how we out perform our competitors over a long duration of time
how to gain a competitive advantage
provide goods or services that:
- consumers value more highly than those of it's competitors
- are similar to the competitors at a lower price
rewards of superior value creation:
,- profitability
- market share
strategic positioning
a unique position within an industry that allows the firm to provide value to customers, while
controlling costs.
value creation - costs = economic contribution
- the greater, the better
- enhances the likelihood of competitive advantage
strategic positioning tradeoffs
- how to allocate resources
- which activities to pursue
Unique Strategic Position
successful combination of strategic activities
competitive advantage has to come from:
- performing different activities
- performing the same activities differently than rivals
pyramid of corporate social responsibility
- philanthropic: corporate citizenship
- ethical: do what is right, just and fair
- legal: laws and regulations are society's codified ethics . define minimum acceptable
standard
- economic: gain and sustain competitive advantage
value creation
, companies with a good strategy are able to provide products or services to consumers:
- at a price point that they can afford
- that enables the company to make a profit
stakeholders
organizations, groups and individuals:
- can affect or be affected by a firm's actions
- have interest in the performance or survival of the firm
stockholders, employees and board members
customers, suppliers, alliance partners, creditors, unions, communities, media and
governments.
stakeholder strategy
integrative approach to managing a diverse set of stakeholders to gain and sustain
competitive advantage.
Stakeholder management benefits firm
performance:
- Cooperative stakeholders reveal important information.
- Increased trust lowers business transaction cost.
- Can lead to greater adaptability and flexibility.
- More predictable and stable returns.
- Stronger reputation
Stakeholder impact analysis
3 important stakeholder attributes:
- power
Correct Answers
5P's of strategy
Plan, Pattern, Ploy, Position, Perspective
Plan
A carefully crafted set of steps that a firm intends to follow in order to be successful
Pattern
A consistent stream of actions
Position
A firm's place in the industry relative to it's competitors
Perspective
How executives and employees view and interpret the competitive landscape around them
Ploy
Specific moves or tactics designed to outwit competitors or manage outsider's impressions
Strategic Management
- an interpretive management field
combines analysis, formulation and implementation in the quest for competitive advantage
Strategy
goal directed actions to gain and sustain superior performance relative to competitors.
Strategy is NOT
,1. grandiose statements
2. failure to face a competitive challenge
3. operational effectiveness, competitive benchmarking or tactical tools
a good strategy is based on 3 elements:
- diagnosis of the competitive challenge: A
- a guiding policy to address the competitive challenge: F
- a set of coherent actions to implement the firm's guiding policy: I
What is the purpose of the AFI framework?
- process by which we engage in doing strategy
competitive advantage
superior performance relative to other competitors in the same industry or the industry
average
- competitive advantage is relative, not absolute
to assess competitive advantage benchmark:
- compare the firm to competitors in the same industry
- compare the firm to the industry average
Sustainable competitive avantage
how we out perform our competitors over a long duration of time
how to gain a competitive advantage
provide goods or services that:
- consumers value more highly than those of it's competitors
- are similar to the competitors at a lower price
rewards of superior value creation:
,- profitability
- market share
strategic positioning
a unique position within an industry that allows the firm to provide value to customers, while
controlling costs.
value creation - costs = economic contribution
- the greater, the better
- enhances the likelihood of competitive advantage
strategic positioning tradeoffs
- how to allocate resources
- which activities to pursue
Unique Strategic Position
successful combination of strategic activities
competitive advantage has to come from:
- performing different activities
- performing the same activities differently than rivals
pyramid of corporate social responsibility
- philanthropic: corporate citizenship
- ethical: do what is right, just and fair
- legal: laws and regulations are society's codified ethics . define minimum acceptable
standard
- economic: gain and sustain competitive advantage
value creation
, companies with a good strategy are able to provide products or services to consumers:
- at a price point that they can afford
- that enables the company to make a profit
stakeholders
organizations, groups and individuals:
- can affect or be affected by a firm's actions
- have interest in the performance or survival of the firm
stockholders, employees and board members
customers, suppliers, alliance partners, creditors, unions, communities, media and
governments.
stakeholder strategy
integrative approach to managing a diverse set of stakeholders to gain and sustain
competitive advantage.
Stakeholder management benefits firm
performance:
- Cooperative stakeholders reveal important information.
- Increased trust lowers business transaction cost.
- Can lead to greater adaptability and flexibility.
- More predictable and stable returns.
- Stronger reputation
Stakeholder impact analysis
3 important stakeholder attributes:
- power
