Business Management Exam 2 Questions and Answers ( Graded A+)

Business Management Exam 2 Questions and Answers ( Graded A+) Strategy - a large scale action plan that sets the direction for the organization Strategic Management - a process that involves managers from all parts of the organization in the formulation and the implementation of strategies and strategic goals Vision - a long-term goal describing what an organization wants to become; a clears sense of the future and the actions needed to get there Strategic Planning - when top managers determine what the organization's long term goals should be for the next 1-5 years with the resources they expect to have available Tactical Planning - middle managers determine what contributions their departments or similar work units can make w/ their given resources in the next 6-24 months Operational Planning - the first line managers determine how to accomplish specific tasks w/ available resources in the next 1-52 weeks Means-End Chain - the accomplishment of low level goals having affect on the goals of the higher levels of management Standing Plans - plans developed for activities that occur repeatedly overtime SMART - Specific Measurable Attainable Results-Oriented Target Dates Peter Drucker's Management by Objectives (MBO) - 1. Managers and employees set objectives for the employee 2. Managers develop action plans 3. Managers and employees periodically review employee performance 4. Managers makes a performance appraisal and rewards the employee according to results Planning/Control Cycle - 1. Make a plan 2. Carry out the plan 3. Control the direction by comparing results w/ the plan 4. Control the direction by taking corrective action in two ways: --correcting deviations --improving future plans Advantages of Establishing Deadlines - Provides a mechanism for giving ourselves feedback; Helps concentrate the mind to make quick decisions; Provides motivation Business Model - the operations of the business, its components and functions, and its expected revenues and expenses Program - a single use plan that encompasses a smaller range of projects or activities Execution Gaps - Unable to identify top priorities; No ownership involvement and commitment; More time is spend on urgent tasks rather than goals; Do not understand what employees can do to help the organization Strategic Positioning - attempts to achieve sustainable competitive advantage by preserving what is distinctive about the company 3 Sources of Strategic Positioning - 1. Few needs, many customers 2. Broad needs, few customers 3. Broad needs, many customers 5 Steps in Strategic Management - 1. Establish the Mission and Vision 2. Assess the Current Reality 3. Formulate the Grand Strategy 4. Implement the Strategy 5. Maintain the Strategic Goal (Feedback Loop) Current Reality Assessment - to look where the organization stands and see what is working and what could be different as to maximize efficiency and effectiveness in achieving the organization's mission Grand Strategy - explains how the organization's mission is to be accomplished; composed of three kinds of strategies: growth, stability, and defensive Strategy Forumulation - the process in choosing among different strategies and altering them best to the organization's needs Mission Statement Questions - These questions involve bigger responses beyond "yes" and "no" Vision Statement Questions - These questions are answered strictly to either "yes" or "no" Competitive Intelligence - gaining info about on'es competitor's actions so that you can anticipate their moves and react appropriately Environment Scanning - careful monitoring of an organization's internal and external environments to detect early signs of opportunities and threats that may influence the firm's plans SWOT Analysis - looking for: Strengths Weaknesses Opportunities Threats Benchmarking - the process of a company comparing its performance with that of high performance organizations Porter's Model for Industry Analysis - 1. Threats of New Entrants 2. Bargaining Power of Suppliers 3. Bargaining Power of Buyers 4. Threats of Substitute Products or Services 5. Rivalry Among Competitors Porter's 4 Competitive Strategies - 1. Cost Leadership 2. Differentiation 3. Cost Focus 4. Focused-Differentiation Cost-Leadership Strategy - keeping prices of products/services below that of the competitors Differentiation Strategy - offering products/services that are unique and superior Diversification - operating several businesses in order to spread risks BGC Matrix - means of evaluating strategic business units on the basis of their business growth rates and their share of the market Execution - the central part of any company's strategy, consisting of questioning, analysis, and follow through mesh strategy Cash Cows - Have slow growth, but high market share Stars - have high growth and high market share Question Marks - risky new ventures; might become either starts or dogs Dogs - Have low growth and low market share; abandoned product/service Elements of Strategy - - a clear goal - a defined target market and products - an aligned company Implementing a Strategy - - Build project terms - Create milestones - Set performance indicators - track progress - report to stakeholders - hold people accountable How to Execute a Strategy - 1. "Do we have the right strategy?" 2. Employ a far and open process to create one 3. Use your project management skills to implement 4. Treat it as a real initiative