key-term-and-concepts-stratma.docx

**STRATMA REVIEWER** **Strategic management** - includes all the decisions and actions set by the managers and provides a gauge on the performance of a particular organization. **STRATEGIC MANAGEMENT PROCESS** \- the step-by-step flow of activities toward the implementation of a strategy to achie...

**STRATMA REVIEWER** **Strategic management** - includes all the decisions and actions set by the managers and provides a gauge on the performance of a particular organization. **STRATEGIC MANAGEMENT PROCESS** \- the step-by-step flow of activities toward the implementation of a strategy to achieve company goals. **1. Situation analysis** - also called environmental scanning. It also provides the information necessary to formulate the company\'s vision/mission statements. **2. Strategy formulation** - the development of company strategies. **3. Strategy implementation** - the development of procedures, programs, and activities to put the strategies into practice. **4. Strategy evaluation** - the appraisal of the company\'s performance. **Electronic age** - the period of vast electronic transactions using the Internet. **Globalization** - the internationalization of markets and corporations **Global brands** - the world\'s top brands associated with quality, reasonable price and reflect the manufacturers\' social and environmental consciousness **Organizational adaptation** - the ability of the company to be updated on what is in store in all facets of the business environment. **Institution theory** - proposes that a company adapts to changing conditions by bench- marking and imitating successful companies**.** **Strategic choice** - explains that an organization not only adapts to a changing environment but also tries to reshape its environment. **The Five Forces Model Framework** **Power of buyers** - ability of the buyers to drive the company\'s prices down **Power of suppliers** - ability of suppliers to control an organization by making their prices higher. **Rivalry of competitors** - ability of each company to counter the strategies offered by its strongest competitor **Threat of substitutes** - the challenge offered by a company with similar features but at lower rates, and can substitute products or services of existing companies. **Threat of new entrants** - the challenge offered by new companies that offer same products or services through product quality, uniqueness, added features, competitive pricing, and the like**.** **Competitive intelligence** - the art of gathering, analyzing, and distributing vast information coined as intelligence about anything that would help in competing in the market. **Strategic intelligence** - being able to understand the competitors\' future prospects and goals. **Tactical intelligence** - a small-scale intelligence and operational in the short run. **Counter intelligence** - knowing how to defend company secrets. **3 Important Structural Features of the Market which should be Considered by any Organization** 1. **Market concentration**- the degree by which a small number of companies dominate the market. 2. **Entry barriers** - refer to the difficulties and challenges experienced by potential new entrants. 3. **Product differentiation** - refers to the degree by which a company is able to distinguish its product or service to other players in the market as valued by consumers **Characteristics Subcategories of Market Structures** **Atomistic** - refers to the structure of the market where there are many small sellers with a low level of interaction to one another. **Oligopolistic** - refers to the structure of the market where there are few large sellers with a high level of interaction to one another. **Monopolistic** - refers to the market with a single player. **Characteristics of Product Differentiations** **Homogeneous products** - refer to the products that are highly similar or identical in features **Differentiated products**-products differentiated by design, quality, branding, etc. **Ease of Market Entry** **Ease of entry** - refers to the point where there are no difficulties in entering the market **Moderately difficult** - refers to the point where there are barriers but not too difficult for sellers to monopolize the market specifically on pricing **Blockaded entry** - refers to the point where barriers are too high that potential players cannot enter and present companies monopolize the prices **SWOT Analysis** - a basic straightforward model in environmental scanning which helps the company in identifying four key elements: strengths, weaknesses, opportunities, and threats