Questions and answers Intro to Management Exam
1 - Hamilton, Rutgers
Business Model - ANS>>Customer Value Proposition and Profit Formula
Profit Formula - ANS>>How effectively the company can deliver on the value
proposition as a profit
Customer Value Proposition - ANS>>Company's approach to satisfying buyer needs to
wants at a price the customer will consider a good value
Value-Price-Cost - ANS>>Value > Price
Price > Cost
Why a business model is important - ANS>>Attract customers
Beat competition
Survive due to lack of profitability
Strategy - ANS>>Action plan for outperforming competitors and achieving profitability
(needs to be distinct)
Why is strategy important? - ANS>>Improve financial performance
Strengthen its competitive position
Gain competitive advantage
Sustainable competitive advantage - ANS>>Provides buyers with superior value
compared to rival seller and persists despite efforts of competitors to match or surpass
Implementing a company's strategy - ANS>>1. Develop strategic vision
2. Set objectives to measure performance
3. Craft a strategy
4. Execute the strategy
Strategic Vision - ANS>>Goals for the company's future and the course and direction to
achieve them
Mission Statement - ANS>>Describes company's business and purpose (who we are,
what we do, why we are here)
Strategic Vision vs. Mission - ANS>>Strategic - future oriented, aspirational, high level
Mission - present oriented, focus on purpose not goal, more specific
Values - ANS>>The beliefs, traits, and behavioral norms that employees are expected
to display
, Objectives - ANS>>Organization's performance targets (financial and strategic)
Financial Objectives - ANS>>financial performance targets
Strategic Objectives - ANS>>targets that indicate a company is increasing its market
standing
Effective Objectives - ANS>>- "stretch objectives": set high enough to stretch an
organization to perform at its full potential and deliver best possible results
- Consists of both short term and long term objectives
- Created at all levels
- SMART goals
SMART - ANS>>Specific
Measurable
Actionable
Realistic
Timely
Deliberate Strategy - ANS>>Proactive strategy elements that are planned
Emergent Strategy - ANS>>Reactive strategy elements that emerge as changing
conditions warrant
Realized Strategy - ANS>>Proactive and reactive elements
Winning strategy must pass - ANS>>Fit test
Competitive advantage test
Performance test
Macro Environment - ANS>>PESTEL Analysis: goal is to identify factors that are
important enough to have a bearing on the company's strategic decisions
- Political
- Economic
- Sociocultural
- Technological
- Environmental
- Legal
Industry and Competitive Environment - ANS>>- Five forces analysis: diagnose the
principal competitive pressures in an industry and assess the potential for profitability
- Driving forces
1 - Hamilton, Rutgers
Business Model - ANS>>Customer Value Proposition and Profit Formula
Profit Formula - ANS>>How effectively the company can deliver on the value
proposition as a profit
Customer Value Proposition - ANS>>Company's approach to satisfying buyer needs to
wants at a price the customer will consider a good value
Value-Price-Cost - ANS>>Value > Price
Price > Cost
Why a business model is important - ANS>>Attract customers
Beat competition
Survive due to lack of profitability
Strategy - ANS>>Action plan for outperforming competitors and achieving profitability
(needs to be distinct)
Why is strategy important? - ANS>>Improve financial performance
Strengthen its competitive position
Gain competitive advantage
Sustainable competitive advantage - ANS>>Provides buyers with superior value
compared to rival seller and persists despite efforts of competitors to match or surpass
Implementing a company's strategy - ANS>>1. Develop strategic vision
2. Set objectives to measure performance
3. Craft a strategy
4. Execute the strategy
Strategic Vision - ANS>>Goals for the company's future and the course and direction to
achieve them
Mission Statement - ANS>>Describes company's business and purpose (who we are,
what we do, why we are here)
Strategic Vision vs. Mission - ANS>>Strategic - future oriented, aspirational, high level
Mission - present oriented, focus on purpose not goal, more specific
Values - ANS>>The beliefs, traits, and behavioral norms that employees are expected
to display
, Objectives - ANS>>Organization's performance targets (financial and strategic)
Financial Objectives - ANS>>financial performance targets
Strategic Objectives - ANS>>targets that indicate a company is increasing its market
standing
Effective Objectives - ANS>>- "stretch objectives": set high enough to stretch an
organization to perform at its full potential and deliver best possible results
- Consists of both short term and long term objectives
- Created at all levels
- SMART goals
SMART - ANS>>Specific
Measurable
Actionable
Realistic
Timely
Deliberate Strategy - ANS>>Proactive strategy elements that are planned
Emergent Strategy - ANS>>Reactive strategy elements that emerge as changing
conditions warrant
Realized Strategy - ANS>>Proactive and reactive elements
Winning strategy must pass - ANS>>Fit test
Competitive advantage test
Performance test
Macro Environment - ANS>>PESTEL Analysis: goal is to identify factors that are
important enough to have a bearing on the company's strategic decisions
- Political
- Economic
- Sociocultural
- Technological
- Environmental
- Legal
Industry and Competitive Environment - ANS>>- Five forces analysis: diagnose the
principal competitive pressures in an industry and assess the potential for profitability
- Driving forces
