BUSI 4940 Exam 1 (Student Quizlet)

Jay Barney

Father of Resource-Based Theory

Strategic Planning process - 6 steps
IAFIMC

1. Strategic Intent
2. Analysis
3. Formulation
4. Implementation/Launch
5. Measurement/Evaluation
6.Control

Which investors can put a company into default and into bankruptcy?

Debt holders

Who are considered the "owners" of a publicly traded company?

"Common" shareholders

Mission statement

WHY does the company exist

Vision Statement

WHAT do you want to accomplish and WHEN?
-formal
-include timeframe
-specific and measurable
-does not use revenue or marketshare

VRIS Model by Jay Barney

V- Valuable
R- Rare
I- Imitability
S- Substitutable

Gary Hamel

Famous Innovator, Core Competencies

Henry Mintzberg

Father of Emergent Strategy & 5 P's of Strategy

Michael Porter

Popularized Modern Competitive Strategy Theory; Created 5-Forces Model/I/0 Model

Igor Ansoff

Father of Strategic Planning

Alfred Chandler

Major pioneer of strategic management thought

Philip Selznick

Organizational- Level Theory

Peter Drucker

"Effectiveness of Executives"

Henri Fayol

Father of Modern Management Theory

Fredrick Taylor

management as a science/ labor efficiency

Concept of Organizational Strategy

1. Strategic Management
2. Strategic Planning Process
A) Process B) Plan
3. Realized Strategy
4. Business Model

Four Primary Objectives of Organizational Strategy

1. Survival
2. Competitive Parity
3. Competitive Advantage
4. Sustain Competitive Advantage

Single Event Game

A "one-event" game means that once a battle or war is won, there is no further competition between the parties. (The opposing side is either dead or has surrendered)

Barriers to Entry

-economies of scale
-product differentiation
-capital requirements
-switching costs
-access to distribution channels
-cost disadvantages independent of scale
-government policy*

The two major of external environment

1. General
2. Industry

General Environment

Can affect the industry and company; company CANT affect back.

Industry Environment

Directly affects the company; company CAN have significant affect back (porters 5 forces)

PEST-DEG

P - Political/legal
E - Economic
S - Sociocultural
T - Technological
D - Demographic
E - Environmental
G - Global

Defines what tern: Unique strength that differentiates a company from its competitors. It is what makes the company stand out in the market and can be viewed as a subset of core competencies that competitors cannot easily imitate.

Distinctive Competency

Poly

Seller

Porters five forces (SBSNR)

1) Seller Power
2) Buyer Power
3) Threat of substitutes
4) Threat of new entry
5) Competitive Rivalry

Resource-based view

1. Resources
2. Capabilities
3. Core Competencies

Resource based view author

Jay Barney

I/0 Model Author

Michael Porter

Resource-based view of the firm

INTERNAL

I/0 Economics view

EXTERNAL

Basic assumptions of Resource based economics

1. Firms acquire different resources
2. Firms develop unique capabilities based on how they combine and use resources
3. Resources and certain capabilities are NOT highly mobile
4. Differences in resources and capabilities are the bases of CA and a firms performance rather than the industry

Basic assumptions of I/0 Economics

1. External Environment (Industry & General)
2. Resources are similar
3. Resource differences are short lived
4. Decision makers are rational

Hypercompetition

Condition where companies engage in intensive rivalry, market change, quickly and often, and entry barriers are low

Disruptive Technologies (aka disruptive innovation)

new technology that destroys the value of an existing tech + creates new markets (ex: streaming services like Netflix replacing things like RedBox and Blockbuster)

Perpetual Innovation

how rapidly and consistently new, information-intensive technologies replace older ones (moores law)

Technology Diffusion

the speed at which new technologies become available to firms and when firms and customers choose to adopt them

Globalization

Increasing economic interdependence among countries and their organizations. Reflected in flow of products, financials, and knowledge across countries.

Above-average returns

Returns "in excess" of what an investor expects to earn from other investments with similar amounts of risk

Average Returns

Returns that are "equal to" those the investor expects to earn from other investments

Risk

Investors uncertainty about economic gains/losses of an investment

Competitive Advantage

Superior value in a competitive Situation by implementing a chosen strategy.

Global Economy

goods, services, people, skills, and ideas move freely across geographic borders

core competencies

Capabilities that serve as a source of CA for a firm over its rivals

What’s better: Distinctive or Core Competency's

Core competencies are the essential skills and abilities that allow a company to compete in its markets, while distinctive competencies are the specific strengths that make the company stand out compared to competitors.

Thus Distinctive is better

Capability

the capacity for a set of resources to perform a task or an activity in an integrative manner

Organizational Culture

the complex set of ideologies, symbols, and core values that are shared throughout the firm and influence how the firm conducts business

Protectionism

Actions taken by a government to protect its economy from adverse influences due to foreign trade

• For example, if a country is worried that its local farmers can't compete with cheaper imported food, it might impose tariffs on foreign produce to make it more expensive, encouraging people to buy locally grown products instead.

Resources

Inputs into firms production process such as capital equipment, skills of employees, patents, finances, and talented managers

Complementors

Companies or networks of companies that sell complementary g/s

Strategic Competitivness

Achieved by successfully formulating and implementing a value creating strategy.

Strategic Flexibility

capabilities used to respond to various demands and opportunities existing in a dynamic and uncertain competitive environment

Strategic Leaders

People located in different areas and levels of the firm to help achieve its vision, fulfill mission, and adhere to values