Strategic Management Reviewer PDF

**Key Terms and Definitions in Strategic Management** 1. **Strategic Management**: The process of defining an organization's direction and making decisions on allocating resources to pursue this direction, encompassing strategy formulation, implementation, and evaluation. 2. **Strate...

**Key Terms and Definitions in Strategic Management** 1. **Strategic Management**: The process of defining an organization's direction and making decisions on allocating resources to pursue this direction, encompassing strategy formulation, implementation, and evaluation. 2. **Strategic Planning**: The process of setting long-term goals and determining the best approach to achieve them. It involves defining the organization's mission, vision, and strategic objectives. 3. **SWOT Analysis**: A tool used to evaluate an organization's internal Strengths and Weaknesses, and external Opportunities and Threats, helping to identify strategic options. 4. **Corporate Strategy**: The overarching strategy that defines the scope and direction of the entire organization, including decisions about diversification, mergers, acquisitions, and resource allocation. 5. **Competitive Advantage**: The ability of an organization to perform in one or more ways that competitors cannot or will not match, resulting in superior performance. 6. **Porter's Five Forces**: A framework developed by Michael Porter to analyze the competitive forces within an industry, including the threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitute products, and industry rivalry. 7. **Resource-Based View (RBV)**: A perspective that emphasizes the importance of internal resources and capabilities in achieving competitive advantage, focusing on leveraging unique assets to outperform competitors. 8. **Core Competencies**: The unique capabilities or strengths of an organization that provide competitive advantage and are difficult for competitors to replicate. 9. **Dynamic Capabilities**: An organization's ability to adapt and reconfigure its resources and processes in response to changing market conditions and opportunities. 10. **Balanced Scorecard**: A strategic management tool developed by Kaplan and Norton that measures performance from multiple perspectives: financial, customer, internal processes, and learning and growth. 11. **Agile Strategy**: An approach to strategy that emphasizes flexibility, adaptability, and responsiveness to rapidly changing market conditions and uncertainties. 12. **Digital Transformation**: The integration of digital technologies into all areas of business operations, resulting in fundamental changes to how organizations operate and deliver value to customers. 13. **Sustainability**: The practice of incorporating environmental and social considerations into strategic planning and execution, aiming to create long-term value while minimizing negative impacts on society and the environment.\ \ \ **Strategic Formulation**: The process of developing strategies based on analysis of internal and external environments, including setting objectives and creating actionable plans. 14. **Strategic Implementation**: The execution of formulated strategies, involving resource allocation, organizational structure adjustments, policy development, and communication. 15. **Strategic Evaluation**: The assessment of strategy effectiveness through performance measurement, feedback collection, and strategic review, making necessary adjustments based on results and changes in the environment. 16. **Business-Level Strategy**: Strategies focused on how to compete successfully within a specific industry or market, including competitive positioning and product/service strategies. 17. **Functional-Level Strategy**: Strategies developed for specific functions or departments within an organization, aimed at optimizing performance and supporting overall business and corporate strategies. **Business Strategy Formulation** **Key Terms and Definitions** 1. **Threat of New Entrants**: The potential for new companies to enter the market, increasing competition and potentially reducing profitability. 2. **Bargaining Power of Suppliers**: The ability of suppliers to influence the price or quality of inputs, impacting a company's cost structure and profitability. 3. **Bargaining Power of Buyers**: The influence customers have over a business, particularly in demanding lower prices or higher quality products. 4. **Threat of Substitutes**: The risk that customers will switch to alternative products or services that fulfill the same need, typically at a lower price. 5. **Industry Rivalry**: The level of competition among existing firms in the industry, influencing pricing, innovation, and marketing strategies. 6. **Cost Leadership**: A strategy where a company aims to be the lowest-cost producer in the industry, enabling it to offer lower prices or achieve higher margins. 7. **Differentiation**: A strategy where a company offers a unique product or service that is perceived as superior by customers, allowing it to command a premium price. 8. **Focus Strategy**: A strategy where a company targets a specific market segment or niche and tailors its offerings to meet the needs of that segment better than competitors.\ \ **Cost Focus**: Offering lower-cost products or services within a specific market segment. 9. **Differentiation Focus**: Providing specialized products or services that cater to the unique needs of a particular market segment. 10. **Economies of Scale**: The cost advantages that a company experiences as it increases its production volume, leading to a reduction in per-unit costs. 11. **Unique Features**: Attributes of a product or service that distinguish it from competitors' offerings and add value for customers. 12. **Market Segmentation**: The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors. 13. **Cost Leadership Strategy**: A competitive business strategy where a company aims to become the lowest-cost producer in its industry, allowing it to offer products or services at lower prices than competitors or to maintain similar prices while enjoying higher profit margins. 14. **Cost Efficiency**: The practice of optimizing operations, reducing waste, and increasing efficiency in production processes to achieve the lowest possible costs. This includes the use of advanced technology, automation, and cost-effective sourcing. 15. **Economies of Scale**: The reduction in the average cost per unit that occurs as a company increases its production volume. By spreading fixed costs over a larger number of units, a company can lower its per-unit cost and improve profitability. 16. **Standardization**: The process of making products or services uniform to reduce complexity and increase production efficiency. Standardization can involve using the same materials, processes, or designs to achieve cost savings and streamline operations. 17. **Cost Control**: Measures and practices designed to monitor and manage expenses to ensure that operational costs are kept to a minimum. This involves budgeting, cost tracking, and strategic sourcing to maintain cost leadership. 18. **Competitive Pricing**: Setting prices lower than competitors to attract price-sensitive customers. This approach can help a company capture a larger market share and increase sales volume by offering better value to consumers. 19. **Market Share**: The portion of total sales in a market that is captured by a company. By implementing a cost leadership strategy, companies can increase their market share by offering lower prices and attracting more customers. 20. **Competitive Pressure**: The influence exerted by a company's low prices on its competitors. A successful cost leadership strategy can force competitors to lower their prices or improve their cost structures to remain competitive.\ \ \ \ \ \ **Profit Margins**: The difference between the cost of producing a product or service and its selling price. Cost leaders often operate with lower profit margins per unit but compensate through higher sales volume. 21. **Limited Market Reach**: The constraint on a company's market scope due to its focus on a specific niche. While the company may excel within its chosen segment, expanding into broader markets may be challenging. 22. **Cost Focus Strategy**: A strategy where a company aims to be the lowest-cost provider within a specific niche. Unlike Differentiation Focus, Cost Focus emphasizes cost efficiency and lower pricing rather than unique value. 23. **Broad Differentiation Strategy**: A strategy where a company seeks to be unique across an entire industry rather than focusing on a specific market segment. This approach aims for industry-wide differentiation rather than niche-specific offerings. 24. **Competitive positioning:** How a business positions itself relative to competitors in the market. 25. **Strategic positioning:** Determining where a business wants to be positioned in the market. 26. **Value proposition:** A clear statement of the unique value that a business offers to its customers. 27. **Competitive advantage:** A sustainable advantage that a business has over its competitors. 28. **Introduction Stage**: The early phase of an industry's life cycle characterized by the launch of new products or services, low competition, and high investment in marketing and development. 29. **Growth Stage**: The phase where the industry experiences rapid expansion, increasing demand, and the entry of new competitors. Companies focus on scaling and market penetration. 30. **Maturity Stage**: The phase where industry growth slows, and the market becomes saturated. Companies compete on price, quality, and differentiation. 31. **Decline Stage**: The phase where industry demand decreases, and companies face challenges such as declining revenues and profitability. Companies may exit the market or adapt to new conditions. 32. **Rejuvenation**: The optional phase where an industry experiences a resurgence due to innovation, market adaptation, or new consumer demands. 33. **Market Saturation**: A condition where the market is fully occupied with products or services, leading to slower growth and increased competition. 34. **Innovation**: The process of developing new products, services, or technologies that can drive growth or revitalization within an industry. 35. **Competitive Intensity**: The level of competition within an industry, which can impact pricing, profitability, and strategic decisions. 36. **Operational Efficiency**: The ability to minimize costs and maximize output, often critical during the maturity stage to maintain profitability amidt intense competition. 37. **Technological Advancements**: Innovations and improvements in technology that can influence industry dynamics, especially during the introduction and rejuvenation stages. **Functional-Level Strategy Development** **Key Terms and Definitions** 1. **Market Segmentation**: The process of dividing a broader market into distinct groups of consumers with common needs, preferences, or characteristics. 2. **Targeting**: Evaluating the potential of each market segment and selecting one or more segments to focus marketing efforts on. 3. **Demographic Segmentation**: Dividing the market based on demographic factors such as age, gender, income, education, and occupation. 4. **Geographic Segmentation**: Segmenting the market by location, such as regions, countries, or cities. 5. **Psychographic Segmentation**: Segmenting consumers based on their lifestyles, values, interests, and personalities. 6. **Behavioral Segmentation**: Focusing on consumer behaviors, such as purchasing patterns, brand loyalty, and product usage. 7. **Brand Positioning**: The strategic process of establishing a brand's identity, value proposition, and unique characteristics in the minds of consumers. 8. **Positioning Statement**: A clear statement that outlines how a brand intends to be perceived in the market, capturing its target audience, category, and unique benefits. 9. **Differentiation**: Creating a distinct identity through unique product features, quality, or service to stand out from competitors. 10. **Cost Leadership**: Competing on price by offering affordable products while maintaining quality. 11. **Niche Positioning**: Focusing on a specific market segment with specialized offerings. 12. **Promotional Strategies**: The methods and channels used to communicate with target audiences and promote products or services. 13. **Digital Marketing**: Utilizing online platforms such as social media, email marketing, content marketing, and search engine optimization (SEO) to connect with consumers. 14. **Advertising**: Promoting products or services through various media, including traditional (TV, radio, print) and digital channels. 15. **Public Relations (PR)**: Engaging with the media and the public to enhance a brand's reputation and manage its image. 16. **Sales Promotions**: Temporary incentives aimed at encouraging immediate purchase decisions, such as discounts, coupons, or limited-time offers. 17. **Customer Relationship Management (CRM)**: Implementing systems and strategies to manage a company's interactions with current and potential customers to enhance loyalty and retention. 18. **CRM Systems**: Software used to track customer interactions, preferences, and purchasing behaviors to personalize communications and offers. 19. **Customer Loyalty Programs**: Initiatives designed to encourage repeat business and enhance customer loyalty, often through rewards and incentives. 20. **Feedback Mechanisms**: Processes for soliciting customer feedback, such as surveys and reviews, to understand satisfaction and identify areas for improvement. 21. **Talent Acquisition**: The process of attracting, hiring, and retaining top talent aligned with the organizational goals. 22. **Employer Branding**: The image and reputation of a company as an employer, highlighting its culture, values, and employee experience to attract potential candidates. 23. **Retention Strategies**: Methods and practices implemented to keep employees engaged and satisfied, thereby reducing turnover rates. 24. **Needs Assessment**: The process of identifying gaps in employee skills and training needs based on strategic goals. 25. **Customized Training Initiatives**: Tailored training programs designed to address specific skills and competencies required for different roles within the organization. 26. **Continuous Learning Culture**: An organizational environment that encourages ongoing professional development and lifelong learning among employees. 27. **Performance Management Systems**: Frameworks used to evaluate employee performance, aligning individual objectives with organizational strategies. 28. **SMART Goals**: Objectives that are Specific, Measurable, Achievable, Relevant, and Time-bound, used to guide performance evaluations and development plans. 29. **Regular Feedback and Reviews**: Ongoing assessment and discussion of employee performance to facilitate continuous improvement. 30. **Development Plans**: Personalized strategies for employee growth and skill enhancement to prepare them for future roles and responsibilities. 31. **Organizational Culture**: The shared values, beliefs, and behaviors that shape how work is done within an organization. 32. **Core Values**: Fundamental principles that guide an organization's actions and decisions, influencing its culture and strategy. 33. **Engagement Initiatives**: Programs and activities designed to enhance employee involvement, satisfaction, and commitment to the organization. 34. **Leadership Role Modeling**: The practice of leaders exemplifying the desired culture and values of the organization, influencing employee behavior and alignment with strategic objectives. **Corporate Strategy Formulation** **Key Terms And Definition** 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. 56. 57. 58. 59.