MGT 201 11th EditionExam # 2 Study Guide Lectures: 9 - 14Lecture 9 (February 18)Chapter 6: Entrepreneurship Impact of entrepreneurship and small businesses:- 28 million small businesses in the U.S. that employ 60 million Americans *Look at 6.1 graph- Five Types of Small Businesses -Launching an entrepreneurial start-up:1.) Start with an idea2.) Write a business plan 3.) Choose a legal structure 4.) Arrange financing -The idea: a great product, a viable market, and good timing are essential ingredients when starting up a business -You will have a good business if…1.) It fills customer’s needs 2.) You have the skills and resources to start a business 3.) You can sell products/services at a price customer’s are willing and able to pay and still make a profit 4.) You can get your products or services to customers during the window of opportunity 5.) You can keep the business going -The opportunity: -Technological discoveries, demographic changes, lifestyle and taste changes, government initiatives -Business plan: A formal planning step that focuses on the entire venture and describes all the elements involved in starting itSole proprietorship- unincorporated business owned by an individual for profit; Disadvantages:unlimited liability Partnership- unincorporated business owned by 2 or more people; Disadvantages: possible disagreements, unlimited liability Corporation- artificial entity created by the state and existing apart from its owners; Disadvantages: expensive and complex Transaction fee model: charging fees for goods and services Subscription model: charging fees for site visits Advertising support model: charging fees to advertise on a site Intermediary model: charging fees to bring buyers and sellers together Affiliate model: charging fees to direct site visitors to other companies’ sites Lecture 10 (February 20) Chapter 7: Managerial Planning & Goal Setting A goal is a desired future state that the organization attempts to realize A plan is a blueprint for goal achievements and specifies the necessary resource allocations, schedules, tasks, and other actions Strategic goals- broad statements describing where the organization wants to be in the future Strategic planning- define the action steps by which the company intends to take Tactical planning- middle-management planning that focuses on a specific department Operational planning- direct employees and resources, criteria for effective goals, includes planning approaches: -Management by objectives-Single-use plans-Standing plans Lecture 11 (February 25)Chapter 8: Strategy Formulation and Execution Strategic management- process that involves managers from all parts of the organization in the formulation and implementation of strategic goals and strategies Strategy is the plan of actionCompetitive advantage- the organization’s distinctive edge for meeting customer’s needs SWOT analysis- analysis of internal strengths and weaknesses and external opportunities and threats Corporate Level Strategy: Answers the question: What business are we in? BCG Matrix- organizes businesses along two dimensions: business growth rate and market shareLecture 12 (February 27)Chapter 8 continued Related vs. Unrelated Diversification -concentric (related): ex.) Marriott Hotels -conglomerate (unrelated): ex.) GE Vertical integration- company that merges with one of its suppliers Ex.) McDonald’s buying potato farms Business Level StrategiesAnswers the question: How do we compete within our business? Competitive strategies: -Cost leadership-Differentiation -Focused differentiation - Focused cost Functional Level StrategyAnswers the question: How do we support the business level strategy?Lecture 13 (March 4) Chapter 9: Managerial Decision Making *Look at graph 9.3- 6 steps of the managerial decision-making process Alternatives in the decision making process-Brainstorming -Devil’s advocate -Point counter-point Classical Model: rational, logical, orderlyAdministrative Model: bounded rationality, satisficing, intuition Satisficing- go with your first choiceIntuition- go with your gut feeling Political Model: build support Group Decision Making Advantages: larger pool of information, more perspectives and approaches, intellectual stimulation, greater understanding, and greater buy-out Disadvantages: takes longer, dominated by a vocal few, goal displacement, and social pressure may stifle creativity Lecture 14 (March 6) Chapter 10: Designing Adaptive Organizations Organizational structure- set of formal tasks assigned to individuals and departments, formal reporting relationships including lines of authority, decision responsibility, and the design of systems to ensure effective coordination across departments Organizational chart- visual representation of an organization’s structure Work specialization- degree to which organizational tasks are subdivided into separate jobs Chain of command- where the authority rests; responsibility, accountability, and delegation Span of management- number of people reporting to any one boss Centralized organization- high-level executives make most decisions and pass them down to lower levels for implementation Decentralized organization- lower level authority make decisions and more it to higher level executives Five forms of departmentalization:1.) Functional2.) Divisional 3.) Matrix4.) Team-based5.) Virtual Network Functional organization- departmentalized around specialized activities such as production, marketing, and human resources **Lecture 15 will also be on Exam #2. Please refer to the notes for study purposes. Those notes are not included on the study guide because the lecture was given after I posted the study