Strategic Management Overview

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to Lesson

Podcast

Play an AI-generated podcast conversation about this lesson
Download our mobile app to listen on the go
Get App

Questions and Answers

What defines the long-term goals of a company?

  • They are usually established for 3-5 years. (correct)
  • They are determined solely by market trends.
  • They should be flexible and change year to year.
  • They are typically set for a year.

Which of the following is NOT a component of a good SWOT analysis?

  • Internal perspectives only. (correct)
  • A deep understanding of strengths and weaknesses.
  • A solid conclusion.
  • Specificity in the statements made.

What is a characteristic of a company that successfully implements a differentiation advantage?

  • Minimizing costs to maximize profit margins.
  • Focusing on volume sales to maximize reach.
  • Providing the lowest prices in the market.
  • Offering creative and innovative products at a higher price. (correct)

In which category of a strategy map would you place customer value propositions?

<p>Customers (A)</p> Signup and view all the answers

Which of the following is a common misconception about short-term objectives?

<p>They can span over several years. (B)</p> Signup and view all the answers

What results when a company is 'stuck in the middle'?

<p>The company fails to achieve competitive advantage. (C)</p> Signup and view all the answers

Which value strategy focuses on offering the best deal for money?

<p>Operational excellence (C)</p> Signup and view all the answers

What should not be a part of a good strategy?

<p>Tracking more than four KPIs. (C)</p> Signup and view all the answers

Which type of diversification involves creating a product that is entirely unconnected to the existing business?

<p>Conglomerate diversification (B)</p> Signup and view all the answers

What does business synergy imply about the combined businesses?

<p>They create additional value when combined. (C)</p> Signup and view all the answers

Which of the following best describes strategic drift?

<p>Being inflexible and clinging to outdated strategies. (C)</p> Signup and view all the answers

What is the purpose of the product market matrix?

<p>To identify potential opportunities for expansion. (B)</p> Signup and view all the answers

Which element does NOT belong in the DESTEP analysis framework?

<p>Legal (A)</p> Signup and view all the answers

What does STP stand for in marketing?

<p>Segmentation, Targeting, Positioning (C)</p> Signup and view all the answers

In a business context, what is meant by 'share of wallet'?

<p>The portion of a customer's total spending that goes to a particular company. (C)</p> Signup and view all the answers

Which of the following is an example of a qualifier for a business?

<p>Providing acceptable customer service in a competitive niche. (B)</p> Signup and view all the answers

What defines a deliberate strategy in relation to an opportunistic strategy?

<p>A deliberate strategy anticipates an unrealised strategy. (D)</p> Signup and view all the answers

Which of the following best describes continuity goals?

<p>Goals focused on the long-term survivability of the organization. (A)</p> Signup and view all the answers

Which elements are included in the strategic triangle?

<p>Steering elements, resources, and environment. (C)</p> Signup and view all the answers

What is a key difference between causal thinkers and effectual thinkers?

<p>Causal thinkers set their sights on specific ends while effectual thinkers are flexible. (C)</p> Signup and view all the answers

What does vertical alignment in strategy ensure?

<p>Decisions on different hierarchical levels support each other. (B)</p> Signup and view all the answers

What two factors determine a company's profit potential?

<p>Market attractiveness and competitive advantage. (D)</p> Signup and view all the answers

What is the purpose of the APIC circle?

<p>To manage the process of analysis, planning, implementation, and control. (D)</p> Signup and view all the answers

What does horizontal alignment in strategy refer to?

<p>Ensuring multi-department collaboration at the same hierarchical level. (C)</p> Signup and view all the answers

Flashcards

Opportunistic Strategy

A strategy that isn't planned but arises from unexpected opportunities.

Continuity Goal

A strategy that outlines long-term survival for the organization.

Social Goal

A strategy that prioritizes relationships within the organization, focusing on employee wellbeing.

Societal Goal

A strategy that focuses on the company's relationship with the wider external world.

Signup and view all the flashcards

Strategic Triangle

The elements that influence strategic decision-making. These include the desired outcome (Steering), available resources (Resources), and external factors (Environment).

Signup and view all the flashcards

Causal Thinkers

Managers who prioritize a specific desired outcome and plan their actions accordingly.

Signup and view all the flashcards

Effectual Thinkers

Entrepeneurs who prioritize available resources and seek opportunities to achieve goals.

Signup and view all the flashcards

Vertical Alignment

Decisions made at different organizational levels are aligned and supportive of each other.

Signup and view all the flashcards

Diversification

Expanding a company's product or service offerings into new markets or industries.

Signup and view all the flashcards

Horizontal Diversification

Creating a new product that appeals to your existing customer base. Think: adding a new flavor to your existing product line.

Signup and view all the flashcards

Vertical Diversification

Expanding your business up or down the supply chain. Think: a restaurant buying a farm to grow its own ingredients.

Signup and view all the flashcards

Concentric Diversification

Expanding into a new market or product using your existing technology or skills. Think: an engine manufacturer using its expertise to build generators.

Signup and view all the flashcards

Conglomerate Diversification

Creating a new product or service that is completely unrelated to your current business. Think: a shoe company buying an airline.

Signup and view all the flashcards

Synergy

The combined value of two businesses is greater than the sum of their individual values. Think: 1 + 1 = 3.

Signup and view all the flashcards

Strategic Drift

A company stuck in its old ways, resisting change and adapting to new strategies.

Signup and view all the flashcards

DESTEP Analysis

A framework for analyzing the external environment of a business, considering factors like demographics, economics, social trends, technology, environmental factors, and politics.

Signup and view all the flashcards

Support Activities

Activities like HR management, R&D, and infrastructure that support a company's main operations.

Signup and view all the flashcards

SWOT Analysis

A structured analysis that examines a company's internal strengths and weaknesses and external opportunities and threats.

Signup and view all the flashcards

Goals vs. Objectives

Long-term goals are typically set for 3-5 years, while short-term objectives are set for 1 year.

Signup and view all the flashcards

Ansoff Matrix

A tool that helps companies choose a strategic direction based on product and market factors, by considering whether a company should pursue new products, new markets, or both.

Signup and view all the flashcards

Competitive Advantage

A competitive advantage can be gained by offering the lowest prices (cost leadership) or by offering unique products/services (differentiation).

Signup and view all the flashcards

Value Strategies

A value strategy focuses on providing value to customers through operational excellence (best value for money), product leadership (innovative products), or customer intimacy (tailored solutions).

Signup and view all the flashcards

Business Model

Describes how a company creates, delivers, and captures value. Think of it as the company's roadmap for success.

Signup and view all the flashcards

Strategy Map

A framework that maps out a company's strategy by aligning four key categories: financial, customers, internal processes, and innovation & learning.

Signup and view all the flashcards

Study Notes

Strategic Management

  • Companies have deliberate and opportunistic strategies. Opportunistic strategies are unplanned, while deliberate ones are planned. Having one can lead to missing out on other potential strategies.
  • Strategic management involves positioning, defining a timeframe, and creating value for customers and stakeholders.
  • Strategic goals include continuity (long-term survival), social (internal relationships and well-being), and societal (external relationships with the broader world).
  • The strategic triangle has three elements affecting strategy: steering elements (what to do), resources (what is available), and environment (trends, opportunities).
  • Hard information is quantifiable data (spreadsheets) and soft information is what people say, think, and feel.
  • Managers tend to focus on the ultimate goal while entrepreneurs focus on available resources and opportunities.

Strategic Business Units (SBUs)

  • SBUs are units within a business.
  • Factors determining profit potential are market attractiveness and competitive advantage creation.

Diversification

  • Companies can diversify in four ways: horizontal (new products for existing customers), vertical (forward/backward products), concentric (technology related products), and conglomerate (unrelated products).
  • Business synergy creates more value than the sum of the individual businesses (2+2=5).

Strategic Drift and DESTEP

  • Strategic drift involves a company's old ways of operating.
  • DESTEP analysis includes demographic, economical, social, technological, environmental, and political factors.

Product Market Matrix and Porter's 5 Forces

  • The product market matrix helps companies identify opportunities in different markets.
  • Porter's 5 forces model examines market attractiveness through competitive analysis, including internal competition, new entrant possibility, substitutes, supplier power, and customer power.
  • Share of wallet illustrates the importance and spending habits of a customer.

STP (Segmentation, Targeting, Positioning)

  • Market segmentation divides the market into groups with similar characteristics.
  • Targeting identifies the specific segments to focus on.
  • Positioning defines the company's place in the market.

Qualifiers and Value Chain

  • A qualifier is a minimum standard needed for a company to succeed.
  • The value chain outlines how a company develops and delivers products. A good company has customer service as a qualifier.

SWOT Analysis and Ansoff Matrix

  • A good SWOT analysis considers internal and external factors including strength, weaknesses, opportunities, and threats.
  • The Ansoff matrix examines new or existing markets and products for strategic planning.
  • Competitive advantages can include cost leadership and differentiation.

Value Strategies

  • Value strategies include operational excellence (low cost), product leadership (innovation and higher cost), and customer intimacy (tailored products).

Business Model and Strategy Map

  • A business model displays how a company produces, delivers, and receives value.
  • The strategy map outlines financial, customer, internal processes, and innovation/learning aspects of the strategy.

Company Culture

  • Company culture is a company's behavioural, value, reward system, and rituals. Company guiding principles should align with day to day actions.
  • Organisational structures include clan-oriented (family-like), adhocracy-oriented (risk-taking), market-oriented (results-driven), and hierarchy-oriented (controlled and structured).

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Quiz Team

Related Documents

Strategic Management Notes PDF

More Like This

Use Quizgecko on...
Browser
Open
Browser
Browser