BUSI 390 Exam.

BUSI 390 Exam. Strategy - CORRECT ANSWER The firm's theory about how to achieve the firm's goals. Strategic Management Process - CORRECT ANSWER Logical steps taken to determine the firm's mission, objectives, and strategy to achieve that mission and objectives Vision - CORRECT ANSWER Future oriented picture of what the firm wants to ultimately acheive Mission - CORRECT ANSWER Specifies the business(es) in which the firm intends to serve 3 key questions that Mission statements address - CORRECT ANSWER 1. Why the Org exists 2. How the org succeeds 3. How people should be managed Necessary elements of a good mission statement - CORRECT ANSWER -Inspiration -Relevance -Specificity Well written objectives/goals are - CORRECT ANSWER Specific Measurable Attainable Relevant Timely Industry - CORRECT ANSWER a group of firms producing products that are close substitutes Examining opportunities and threats by studying the external environment - CORRECT ANSWER firms identify what they MIGHT choose to do Examining unique resources, capabilities, and competences, by studying the internal environment - CORRECT ANSWER firms determine what they CAN do Components of the External Environmental analysis - CORRECT ANSWER Scanning Monitoring Forecasting Assessing Porters Five Forces - CORRECT ANSWER 1. Bargaining power of suppliers 2. Bargaining power of consumers 3. Threat of substitutes 4. Threat of new entries 5. Rivalry Threat of New Entrants - CORRECT ANSWER Economies of scale Product differentiation Capital requirements Switching costs Access to distribution channels Disadvantages independent of scale Government policy Expected retaliation Threat of Substitute products increases when - CORRECT ANSWER -Buyers face few switching costs -The substitute product's price is lower -Substitute product's quality and performance are equal to or greater than the existing product's Bargaining power of Suppliers increases when - CORRECT ANSWER Suppliers are large and few in number Suitable substitute products are not available Individual companies are not large customers of suppliers and there are many of them Suppliers' goods are critical to buyers' marketplace success Suppliers' products create high switching costs Suppliers pose a threat to integrate forward into buyers' industry Bargaining Power of Buyers increases when - CORRECT ANSWER Buyers are large and few Buyers purchase a large portion of an industry's total output Buyers' purchases are a significant portion of a supplier's annual revenues Buyers can switch to another product without incurring high switching costs Buyers pose a threat to integrate backward into the sellers' industry Industry rivalry increases when - CORRECT ANSWER There are numerous or equally balanced competitors Industry growth slows or declines There is a lack of differentiation opportunities or low switching costs When high exit barriers prevent competitors from leaving the industry Unattractive Industry - CORRECT ANSWER Low entry barriers suppliers and buyers have strong bargaining power