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Define the term "strategic management".
Set of managerial decisions and actions that determines the long-run performance of a firm.
List four phases of strategic management.
- 1. Basic financial planning
- 2. Forecast-based planning
- 3. Externally-oriented planning
- 4. Strategic Management
List four basic elements of strategic management.
- 1. Environmental Scanning
- 2. Strategy Formulation
- 3. Strategy Implementation
- 4. Evaluation and Control
Define the term "strategy".
A strategy is a consciously intended course of action, a guideline how to pursue an organizations mission and achieve objectives.
Identify the five forces that shape competition as described by Porter.
- 1. Threat of Substitute Products or Services
- 2. Bargaining Power of Buyers
- 3. Bargaining Power of Suppliers
- 4. Rivalry among competitors
- 5. Threat of New Entrants
Explain what is meant by the term "competitive advantage".
A benefit that exists when a firm has a product or service that is seen by its target market as better than those of competitors.
List three directional strategies.
- 1. Growth
- 2. Stability
- 3. Retrench
List the five stages of international development.
- 1. (Domestic company) domestic company exports through local dealers in foreign country
- 2. (Domestic company with export division) Establish sales company in other countries to eliminate middleman
- 3. (Primarily domestic company with international division) Open manufacturing facilities in other countries
- 4. (Multinational corporation with multidomestic emphasis) Establishes local operating divisions, such as Ford of Britain
- 5. (MNC with global emphasis) Worldwide strategies
Describe the Boston Consulting Group (BCG) model of product and service.
- 1. Question marks - (problem child or wildcats)
- 2. Stars- Market leaders that are at the peak of their product life cycle
- 3. Cash cows- High market share/low growth (in the declining stage)
- 4. Dogs- low market share and low potential
List and explain Miles and Snow's typology of alternative strategies.
- 1. Defenders - limited product line focus on improving efficiency
- 2. Prospectors - Broad product line focus on innovation
- 3. Analyzers - operate in two different markets
- 4. Reactors - lack consistent strategy - structure - culture
List and describe the stages in an organizational life cycle.
- 1. Birth - Concentration in a niche/Entrepreneur dominated
- 2. Growth - Horizontal and vertical growth/Functional management emphasized
- 3. Maturity - Concentric and conglomerate diversification/Decentralization into profit or investment centers.
- 4. Decline - Profit strategy followed by retrenchment/Structural surgery
- 5. Death - Liquidation or bankruptcy/Dismemberment of structure
Explain the relation between Mission statements, Vision Statements, and Strategic Plans.
- 1. Mission is the organizations reason for existence
- 2. Vision is what the organization would like to become
- 3. Strategic plans are the courses of action used to obtain objectives