MANGMT 3000: EXAM 2
98 Cards in this Set
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Six Phases of Strategic Management
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- Establishment of mission, vision and guide
- Analysis of internal strengths and weaknesses
- Analysis of external opportunities and threats
- SWOT analysis and strategy formulation
- Strategy implementation
- Strategic control
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competitive environment
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forces affecting organizations in an industry (Porter's Five Forces)
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macro environment
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forces affecting all organizations
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Porter's Five Forces
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- Suppliers
- Rivals
- Substitues
- Buyers
- New Entrants
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Describe the organization's environment
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The forces outside the firm's abstract boundaries
The more the environment changes, the more the organization must change
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organizational effectiveness
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The extent to which an organization achieves its goals
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organizational efficiency
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The organization's output generated divided by its inputs consumed (output/input)
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Denver Broncos case
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The first owners spent no money and were very efficient but not effective at all
The team was sold to new owners who spent money and were much more effective but lost efficiency
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Icarus Paradox
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Effectiveness can be dangerous
An organization is most vulnerable to complacency when it is most successful
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Characteristics of effective goals (S.M.A.R.T.)
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Specific
Measurable
Acceptable
Realistic and challenging
Timed
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Principles of effective goals
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Avoid too many goals at the same time
Proper goal statement (use the format):
to (action verb) (measurable goal) (by deadline)
ex. "to win championship by next season"
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goal-setting theory
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having a goal statement is proven to increase both effectiveness, efficiency, and overall organizational performance.
ex.
No original goal statement - performance was horrible
Goal statement 1: "do your best" - performance improved slightly
Goal statement 2: "fill each truck to…
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Goals Influence on Achievement
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Goals narrow attention and direct efforts to goal relevant activities.
Goals can lead to more effort
Goals influence persistence
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Strategy Analysis (SWOT)
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Strength
Weakness
Opportunity
Threat
Match internal strengths with external opportunities
Avoid internal weakness and external threat combinations
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Strategic Management Process
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Plan
Analyze
Formulate
Implement
Control
(again and again and again)
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corporate strategy
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sets long-term direction for the total enterprise
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business strategy
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identifies how a division or strategic business unit will compete in its product or service domain
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functional strategy
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guides activities within one specific area or operations
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strategy formulation
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the process of crafting strategies to guide the allocation of resources
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strategy implementation
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the process of putting strategies into action
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major components in the strategic management process
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strategic analysis - assessing competitive position
strategy formulation - creating strategies
Strategy Implementation - putting strategies into action
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SWOT analysis
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examines organizational strengths and weaknesses and environmental opportunities and threats
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growth strategy
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involves expansion of the organization's current operations
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stability strategy
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maintains current operations without substantial changes
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renewal strategy
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tries to solve problems and overcome weaknesses that are hurting performance
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global strategies
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adopts standardized products and advertising for use worldwide
ex. the latest Gillette razors are typically sold and advertised similarly around the world.
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strategic alliance
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organizations join together in partnership to pursue an area of mutual interest
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co-opettion
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the strategy or working with rivals on projects of mutual benefit
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BCG matrix
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analyzes business opportunities according to market growth rate and market share.
Stars: high-market-share businesses in high growth markets
Question Marks: low-market-share businesses in high-growth markets
Cash Cows: high-market-share businesses in low-growth markets
Dogs: l…
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strategic incrementalism
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makes modest changes in strategy as experience builds over time.
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emergent strategies
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Strategies that occur from responses to customer requests, manufacturing problems, competitive threats, and technological advances
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corporate governance
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the system of control and performance monitoring of top management.
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environmental change
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Amount and predictability, the rate at which a companys general and specific environments change
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environmental complexity
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the number and the intensity of external factors in the environment that affect organizations
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elements that make an organization's structure mechanistic
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Stable and simple environment
-Decisions aren't made as fast buy they're proven
-Centralized concentration of power
-Formal rule making
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elements that make an organization's structure organic
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Dynamic and complex environment
-Fast decision making
-Decentralized concentration of power
-informal rule making
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mechanistic structure
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An organizational structure in which authority is centralized, tasks and rules are clearly specified, and employees are closely supervised.
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organic structure
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An organizational structure in which authority is decentralized to middle and first-line managers and tasks and roles are left ambiguous to encourage employees to cooperate and respond quickly to the unexpected.
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Structural Adaptation to the Environment
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Adaptation is measure by effectiveness
Effectiveness depends on how well the structure and environment match
Eff = S x Env
The speed of decision making needs to keep pace with the rate of environmental change
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Explain correct matches for organizational structure and environment
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a. If environment is dynamic and complex and company is effective- organic structure
b. If environment is stable and simple and company is effective- mechanistic structure
c. If structure is mechanistic and company is not effective- dynamic and complex env't
d. If structure is or…
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Functional configuration
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Functional (aka. departmental): each department specializes in one business function
i. Stable and simple env't
ii. Small companies (500 or less employees)
iii. Focused on efficiency
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Divisional Configuration
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Divisional: less centralized; each division is like an individual business
i. Dynamic and complex env'ts
ii. Large companies (more than 500 employees)
iii. Inefficiencies from redundant functions- more focused on being effective
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Organizational Configuration
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the system of tasks, workflows, reporting relationships, and communication channels that link together individuals and groups in an organization (Functional and Divisional)
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Advantages and Disadvantages of functional configuration
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Advantages
-efficient; economies of scale
-tasks match expertise
-technical problem solving
-training and development
-defined career path
Disadvantages
-'chimney' problem - lack of communication across functions
-lack of common purpose
-decisions deferred upward
-difficult to…
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Advantages and Disadvantages of divisional configuration
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Advantages
-flexible to change in environment
-coordination across functions
-clear responsibility
-focus on customer
Disadvantages
-loss of efficiency
-poor coordination among divisions
-divisional goals trump organizational goals
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Three primary forms of Divisional Configuration
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1. Product Form
2. Geographic Form
3. Customer Form
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Describe matches for organizational configuration and organizational strategy.
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Low Cost Strategy = Functional Structure
More Efficient - only one of every department
(EXAMPLE) Payless
Differentiation Strategy = Divisional Structure
Need for innovation multiple products
(EXAMPLE) Nike - different make/model for every shoe
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Formal Structure
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the official structure of the organization
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Informal Structure
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the set of unofficial relationships among an organization's members
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functional structure
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groups together people with similar skills who perform similar tasks
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divisional structure
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groups together people working on the same product, in the same area, with similar customers, or on the same processes
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matrix structures
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combines functional and divisional approaches to emphasize project or program teams
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Advantages of matrix structures
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-better cooperation across functions
-improved decision making
-increased flexibility in adding, removing, or changing operations to meet changing demands
-better customer service
-better performance accountability through the program, product or project managers
-improved strategic …
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Disadvantages of matrix structures
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Can cause uncertainty and lead to intense power struggles
Working relationships become more complicated
Decisions may take longer
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network structure
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uses information technologies to link with networks of outside suppliers and service contractors
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Advantages of a network approach
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...
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Disadvatages of a network approach
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...
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boundaryless organization
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eliminates internal boundaries among subsystems and external boundaries with the external environment
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mechanistic design
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centralized, with many rules and procedures, a clear-cut division of labor, narrow spans of control. and formal coordination
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organic design
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decentralized, with fewer rules and procedures, open divisions of labor, wide spans of control, and more personal coordination.
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differnetiation
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the degree of difference between subsystems in an organization
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integration
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the level of coordination achieved between subsystems in an organization
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Theory of Five Rights
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-The right to free, informed consent
-The right to privacy
-The right to freedom of conscience
-The right to free speech
-The right to due process
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business ethics
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The moral principles and standards that guide behavior in the world of business.
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the utilitarian theory
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Do the consequences of actions produce the greatest good for the greatest number?
-Problems with measurements and calculation
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the principle of double-effect
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The intent is to achieve the good effect; the good effect is much greater than the bad effect; "Master Theory"
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organizational culture
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the set of shared values, beliefs and behaviors learned as a member of a social group
i. Learned, shared and transmitted
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2. Explain the three levels of organizational culture.
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Artifacts- very outward, readily seen
i. Symbols- visual, tangible reminders
ii. Heroes- visual, sensory; human being- dead or alive
iii. Stories, Myths and Legends- can be true or false but represent values of company
iv. Slogans- words and phrases that represent values
v. Ceremonie…
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Summarize research study findings for the relationships among time horizons and performance.
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The study: Allen Bluedorn; The Human Organization of Time
i. Does your past time horizon influence your future time horizon
The findings:
i.Future and past time horizons are positively correlated
1.Future and past time horizons are both positively correlated with organizational age
…
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Summarize research study findings for the relationships among polychronicity and other factors.
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a. Punctuality- negatively correlated w/ poly (high punctuality, high poly.)
b. Personal space distance- negatively correlated w/ poly (large personal space, high poly.)
c. Correlation b/w polychronicity and...
i. Gender- no difference
ii. Age- no difference
iii. Level of educati…
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monochromic behavior tendencies
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i. View time as cyclical, continuous, infinite
ii. Distractible and subject to interruptions- do many things
iii. Consider time commitments an objective to be achieved, if possible- project driven
iv. High-context and already have information- get it
v. Are committed to people and hum…
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polychronic behavioral tendencies
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i. View time as linear, discrete, finite
ii. Concentrate on job- don one thing
iii. Take time commitments seriously- schedule driven
iv. Are low-context and need information- what, help?!
v. Are committed to the job- loyal to company, job
vi. Adhere religiously to plans- daytimer
vi…
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Explain the competing values model. Describe dimensions, values, and cultures.
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Dimensions: flexibility vs control and external vs internal
Values:
i. Risk taking, growth, creativity
1. Adhocracy culture
ii. Profitability, efficiency, goal achievement
1. Rational culture
iii. Teamwork, development, morale
1. Group culture
iv. Stability, rules and procedures…
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paradigm concept
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Paradigm: a set of rules and regulations that define boundaries
i. Good effect is that it tells you where/how to look for solutions
ii. Bad effect is that it limits creativity outside the boundaries
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Explain the types of creativity.
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Creation: the act of making something out of nothing
Synthesis: the act of relating two or more previously unrelated phenomena
Modification: the act of altering something that already exists so that it can:
i. Perform its function better
ii. Perform a new function
iii. Perform in…
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Explain why people believe that they are not creative.
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a. No credit: people see creativity only as creation, neglect synthesis, modification
b. Self-fulfilling prophecy: no credit approach instills uncreative sense in person, they stop trying
c. Bureaucratic beat-down: organizations tend to punish rather than reward creativity in general
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Explain the general reasons for resistance to change.
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Human inertia
i. Once we learn one way, we tend to keep doing it that way
Timing
i. Bad choices in timing, usually during other focus
Surprise
i. People are not given the time to deliberate change
Peer pressure
i. Can work for or against
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Explain a force-field analysis and how to perform one.
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a. State reasons for and against change
b. Quantify reasons in numerical values
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Four views of ethical behavior
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moral rights view
does a decision of behavior maintain the fundamental rights of all human beings?
individualism view
does a decision or behavior promote one's long-term self-interests?
justice view
does a decision or behavior show fairness and impartiality?
utilitarian view
…
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cultural relativism
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suggests there is no one right way to behave; ethical behavior is determined by its cultural context
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universialism
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suggests ethical standards apply absolutely across all cultures
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ethics intensity
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indicates the degree to which an issue or situation is recognized to pose important ethical challenges
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inappropriate rationalizations for unethical behavior
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it isn't really illegal
it's in everyone's best interests
no one will ever find out
the organization will protect me
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whistleblower
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exposes the misdeeds of others in organizations
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List three organizational barriers to whistleblowing.
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ethics training
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seeks to help people understand the ethical aspects of decision making and to incorporate high ethical standards into their daily behavior
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code of ethics
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a formal statement of values and ethical standards
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amoral manager
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fails to consider the ethics of her or his behvaior
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immoral manager
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chooses to behave unethically
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moral manager
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makes ethical behavior a personal goal
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ethics mindfulness
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enriched awareness that leads to consistent ethical behavior
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discrimination
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occurs when someone is denied a job or job assignment for reasons not job-relevant
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corporate social responsibility
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is the obligation of an organization to serve its own interest and those of society
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equal employment opportunity
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the right to employment and advancement without regard to race, sex, religion, color, or national origin
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affirmative action
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an effort to give preference in employment to women and minority group members
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bona fide occupational qualifications
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are employment criteria justified by capacity to perform a job
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internal recruitment
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seeks job applicants from outside the organization
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external recruitment
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seeks job applicants from inside the organization
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MANGMT 3000: EXAM 1