Business Strategy & The Strategic Management Process

Comprehensive vocabulary flashcards covering business strategy fundamentals, the strategic hierarchy, the 5 core components, the 7 characteristics of effective strategy, the 4-stage continuous management process, and the Sunrise Bakery case study application.

Business Strategy

A long-term course of action chosen by an organization to achieve its objectives, compete effectively, satisfy customers, and sustain long-term success; the master plan explaining how a business will win.

Strategy (Strategic Hierarchy)

The senior management level focused on broad, long-term direction that answers the key question: "Where do we want to go?"

Tactics (Strategic Hierarchy)

The middle management level focused on specific short- or medium-term actions that answer the key question: "What specific actions will take us there?"

Operations (Strategic Hierarchy)

The supervisory and operational staff level focused on routine day-to-day activities that answer the key question: "What must we do every day to make it happen?"

Goals & Objectives (Strategy Component)

Clear targets such as increasing market share, sales, or quality, establishing necessary overall direction.

Resource Allocation (Strategy Component)

The process of deciding how limited money, staff, technology, and equipment are distributed.

Competitive Position (Strategy Component)

Determining how an organization will win against rivals, such as through low cost, premium quality, or a specialized niche.

Market & Customer Focus (Strategy Component)

Identifying target customer needs, preferences, and methods for value creation.

Long-Term Sustainability (Strategy Component)

Balancing short-term wins with ongoing financial and environmental viability.

Clear (Strategy Characteristic)

An effective strategy characteristic meaning it is easily understood by all employees.

Realistic (Strategy Characteristic)

An effective strategy characteristic meaning it matches organizational resources and capabilities.

Goal-Oriented (Strategy Characteristic)

An effective strategy characteristic meaning it directly drives core objectives.

Flexible (Strategy Characteristic)

An effective strategy characteristic meaning it adapts quickly to market changes.

Competitive (Strategy Characteristic)

An effective strategy characteristic meaning it creates unique value for customers.

Consistent (Strategy Characteristic)

An effective strategy characteristic meaning it harmonizes internal departmental efforts.

Sustainable (Strategy Characteristic)

An effective strategy characteristic meaning it ensures ongoing long-term success.

Strategic Management Process

A continuous four-stage cycle consisting of Environmental Analysis, Strategy Formulation, Strategy Implementation, and Evaluation & Control, where evaluation feeds back into analysis.

Environmental Analysis (Stage 1)

The first stage of strategic management, examining internal strengths and weaknesses alongside external opportunities and threats.

Internal Environment

Factors within an organization's control—such as employees, finances, technology, culture, and facilities—analyzed to uncover strengths and weaknesses.

External Environment

Factors outside an organization's control—such as competitors, the economy, customer shifts, laws, and technology—analyzed to uncover opportunities and threats.

Strategy Formulation (Stage 2)

The stage of developing and selecting strategic options to achieve goals, including market expansion, product innovation, price leadership, quality focus, or increased promotion.

Strategy Implementation (Stage 3)

The stage of putting choices into action by allocating budgets, assigning staff responsibilities, training employees, developing operational policies, and coordinating departments.

Evaluation and Control (Stage 4)

The stage of measuring actual performance against targets and taking corrective actions through a structured feedback loop.

5-Step Feedback Loop

The sequential process in Stage 4: 1. Set Standards, 2. Measure Actual, 3. Compare Results, 4. Find Causes, and 5. Take Action.

Sunrise Bakery: Challenge

Declining customer sales resulting from new competitors and customer shifts toward online ordering.

Sunrise Bakery: Objective

Increase bakery sales by $20\%$ over the next two years.

Sunrise Bakery: Strategy

Expand digital sales and delivery while maintaining fresh product quality.

Sunrise Bakery: Tactics

Launch an online ordering system, run social media advertising, and offer home delivery.

Sunrise Bakery: Operations

Process incoming online orders, bake fresh goods, package items, and complete deliveries.