MGT 8803 - Business Strategy STUDY GUIDE.
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
https://www.stuvia.com/
,*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
https://www.stuvia.com/
, 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
Mission - how firm will achieve vision | product OR customer market focus
Core Values - guiding principles of firm | support company's vision, shape culture, & reflect
company's identity & personality
Business Model Framework - Value Delivery
Value Creation
Value Capture
https://www.stuvia.com/
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
https://www.stuvia.com/
,*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
https://www.stuvia.com/
, 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
Mission - how firm will achieve vision | product OR customer market focus
Core Values - guiding principles of firm | support company's vision, shape culture, & reflect
company's identity & personality
Business Model Framework - Value Delivery
Value Creation
Value Capture
https://www.stuvia.com/
