Questions and Answers
What is strategic management?
What is a strategy?
The plan of action that prescribes resource allocation and other activities for dealing with the environment.
Define core competence.
A business activity that an organization does particularly well in comparison to competitors.
Synergy occurs when parts of an organization interact to produce a joint effect greater than the sum of the parts acting alone.
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What is corporate level strategy?
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What is business-level strategy?
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What is functional-level strategy?
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What is strategy formulation?
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What does strategy execution involve?
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What is SWOT analysis?
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Define strategic business unit.
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What is portfolio strategy?
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What is the BCG matrix?
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What is diversification?
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Define related diversification.
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What is unrelated diversification?
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What is vertical integration?
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Which of the following are part of Porter's Five Competitive Forces?
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Define differentiation in a competitive strategy.
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What is cost leadership?
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What does focus mean in competitive strategy?
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What are dynamic capabilities?
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What is globalization?
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Define multi-domestic strategy.
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What is transnational strategy?
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Which of the following are components of strategy execution?
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Study Notes
Strategic Management Concepts
- Strategic Management: Involves decisions and actions that align an organization with its environment to fulfill its goals competitively.
- Strategy: A plan dictating how resources are allocated to gain competitive advantage and achieve objectives.
- Core Competence: A business activity that an organization excels at relative to its competitors, providing a unique advantage.
Organizational Dynamics
- Synergy: The phenomenon where interactions among an organization’s parts yield a greater overall effect than their individual performances.
- Corporate Level Strategy: Addresses the fundamental question of what businesses the organization should be in.
- Business-Level Strategy: Defines how a business competes within its sector; focuses on market tactics.
- Functional-Level Strategy: Supports business-level strategies through specialized actions and resources.
Strategy Development and Implementation
- Strategy Formulation: The decision-making process that involves assessing the environment and forming corporate, business, and functional strategies to meet objectives.
- Strategy Execution: The phase that utilizes managerial tools and resources to ensure strategic outcomes are achieved.
Analytical Tools
- SWOT Analysis: Evaluates an organization’s strengths, weaknesses, opportunities, and threats to inform strategic planning.
- Strategic Business Unit (SBU): A division within an organization with a distinct business mission, products, competitors, and markets.
- Portfolio Strategy: The collection and management of SBUs and product lines to achieve synergy and a competitive edge.
Growth Strategies
- BCG Matrix: A tool for assessing SBUs based on market growth rate and market share to inform resource allocation.
- Diversification: Expanding sales through new products in new markets; this includes both related and unrelated diversification.
- Related Diversification: Expanding into new businesses that can benefit from existing operations or enhance competitive advantage.
- Unrelated Diversification: Entering a new business area that shares no ties with the current operations.
Integration and Competitive Strategies
- Vertical Integration: A strategy where a single entity controls all stages of a product’s life cycle, from raw material to distribution.
- Porter’s Five Competitive Forces: Framework evaluating competitiveness based on new entrants, buyer power, supplier power, substitutes, and rivalry.
- Differentiation: A strategy aimed at distinguishing products/services to provide unique value compared to competitors.
- Cost Leadership: Focuses on achieving efficiencies and cutting costs to outperform competitors on price.
- Focus Strategy: Concentrates on serving a specific market or buyer group effectively.
Global Strategies
- Dynamic Capabilities: The ability to leverage and enhance existing assets and competencies for sustainable advantages.
- Globalization: Standardizing product design and marketing approaches across international markets.
- Multi-Domestic Strategy: Customizes products and marketing to align with local market conditions and consumer preferences.
- Transnational Strategy: Aims to achieve efficiency globally while being responsive to local needs.
Strategy Execution Components
- Key elements involved in strategy execution include leadership, structural design, information and control systems, and human resources.
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Description
Explore the key concepts of strategic management through these flashcards based on Chapter 7. Understand the importance of strategy formulation and implementation in achieving organizational goals and gaining a competitive edge. Perfect for students looking to reinforce their knowledge in this crucial area of business management.