MGT 8803 - Business Strategy UPDATED ACTUAL
Questions and CORRECT Answers
Role of Planning in Firm Planning (primary) -> organizing & staffing -> leading ->
controlling
External Context for Planning regulators | partners & shareholders | competitors | suppliers |
tech, econ, labor, society | communities | customers
Internal Context for Planning mgt's vision | mission/values | culture | people & workforce
diversity | technology | physical assets | intellectual property
Planning is important because it... 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 the unknowable; uncertainty that remains...important in
assessing risk
Hierarchical (Tall) Organizational Structure many layers of middle mgt | senior mgrs make most
operational decisions | information flows from top-down |
stable environment
Flat (Networked) Organizational Structure 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 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 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 1. narrow, specific to firm
2. allocation of specific resources to specific tasks or
operations
SMART Specific, Measurable, Attainable, Realistic, Timely
Main objective of business strategy achieve superior performance in marketplace
Strategy goal-directed actions a firm takes to gain & sustain superior
performance relative to competitors.
Competitive advantage 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 1. diagnosis of competitive challenge
2. guiding policy to address competitive challenge
3. set of coherent actions to implement
Cost Leadership lowest-cost producer in industry | pricing at or below industry
avg while leveraging a low "cost" advantage
Differentiation 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 battery technology, autonomous driving, high performance,
supercharger network, wow factor
Focus strategy establish either a cost leadership OR differentiation
competitive advantage but focused in a narrow market
segment (ex: Rolex, Louis Vuitton)
Vision mgt's description of business model, technology, workforce,
strategic positioning, and goals | for inspiring employees &
stakeholders
Questions and CORRECT Answers
Role of Planning in Firm Planning (primary) -> organizing & staffing -> leading ->
controlling
External Context for Planning regulators | partners & shareholders | competitors | suppliers |
tech, econ, labor, society | communities | customers
Internal Context for Planning mgt's vision | mission/values | culture | people & workforce
diversity | technology | physical assets | intellectual property
Planning is important because it... 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 the unknowable; uncertainty that remains...important in
assessing risk
Hierarchical (Tall) Organizational Structure many layers of middle mgt | senior mgrs make most
operational decisions | information flows from top-down |
stable environment
Flat (Networked) Organizational Structure 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 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 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 1. narrow, specific to firm
2. allocation of specific resources to specific tasks or
operations
SMART Specific, Measurable, Attainable, Realistic, Timely
Main objective of business strategy achieve superior performance in marketplace
Strategy goal-directed actions a firm takes to gain & sustain superior
performance relative to competitors.
Competitive advantage 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 1. diagnosis of competitive challenge
2. guiding policy to address competitive challenge
3. set of coherent actions to implement
Cost Leadership lowest-cost producer in industry | pricing at or below industry
avg while leveraging a low "cost" advantage
Differentiation 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 battery technology, autonomous driving, high performance,
supercharger network, wow factor
Focus strategy establish either a cost leadership OR differentiation
competitive advantage but focused in a narrow market
segment (ex: Rolex, Louis Vuitton)
Vision mgt's description of business model, technology, workforce,
strategic positioning, and goals | for inspiring employees &
stakeholders
