MNGT 3100 Exam 2 - Spring 2025 - Elwell-Chalmers

Strategic goals

Set by and for top management - Focuses on broad, general goals - *Long-term goals

Tactical Goals

Set by and for middle managers - Focus is on actions necessary to achieve strategic goals - *Intermediate-term goals

Operational Goals

Set by and for lower level managers - Focus is on short-term issues associated with tactical goals - *Short-term goals

What should support a companies mission, vision, and values?

Strategic Goals

What is the company's "why" or purpose?

The Mission Statement

What is the cornerstone of planning?

Decision Making

What is the point of having goals in an organization?

1. Goals provide guidance and a unified direction.

2. Goal setting affects other aspects of planning.

3. Specific and moderately difficult goals can motivate employees.

4. Goals provide an effective mechanism for evaluation and control.

standing plan

Developed for activities that recur regularly over a period of time.

Ex. policies, standard operating procedures, rules, and regulations

What is an emergent strategy?

A forced strategy - A pattern of action that develops over time in an organization in the absence of mission and goals, or despite mission and goals. Allocating resources even though an organization has not explicitly chosen this strategy.

Example: Companies navigating Covid

What is one way to differentiate?

Increase the scope of what you do.

Corporate-level strategy

The set of strategic alternatives from which an organization chooses as it manages its operations simultaneously across several industries and several markets

Business-level strategy

The set of strategic alternatives from which an organization chooses as it conducts business in a particular industry or market

What does SWOT stand for?

Strengths, Weaknesses, Opportunities, Threats

What part of SWOT is internal?

Strengths and Weaknesses

What part of SWOT is external?

Opportunities and Threats

What are the stages of a Product Life Cycle?

1. Introduction

2. Growth

3. Maturity

4. Decline

Single-Product Strategy

A strategy in which an organization manufactures just one product or service and sells it in a single geographic market

*be able to recognize an example

Related-Product Strategy (Diversification)

organization operates in several businesses that are linked with one another

Example: Hilton Hotels

Unrelated-Product Strategy (Diversification)

A strategy in which an organization operates multiple businesses that are not logically associated with one another

Example: Samsung: washing machines & phones

Forward Vertical Integration

An organization begins activities formerly conducted by its customers. (I'm doing something my customers used to do.)

Backward Vertical Integration

An organization conducts activities formerly conducted by its suppliers/distributors

Decision Making:

• Is the cornerstone of planning

• Is the catalyst that drives the planning process

• Underlies the formulation and implementation of all plans

Under what circumstances are managers most prone to making a bad decision?

theres a lot of uncertainty

What is evidence-based management?

A commitment to finding and using the best theory and data available at the time to make decisions

Administrative model in decision making:

behavioral processes that affect how managers make decisions. Rather than prescribing how decisions should be made, it focuses more on describing how they are made.

What are coalitions?

An informal alliance of individuals or groups formed to achieve a common goal (preferred decision alternative)

Advantages of Group Decision Making:

- More information and knowledge are available.

- More alternatives are likely to be generated.

- More acceptance of the final decision is likely.

- Enhanced communication of the decision may result.

- Better decisions generally emerge.

Disadvantages of Group Decision Making:

- The process takes longer than individual decision making, so it is costlier.

- Compromise decisions resulting from indecisiveness may emerge.

- One person may dominate the group.

- Groupthink may occur.

how can you motivate organizations employees

specific and moderately difficult goals; evidence based management

what steps or what kind of organized sequence of steps is designed to execute strategic plans

tactical plan:

1. evaluate each course of action

2. obtain and distribute information and resources

3. monitor horizontal and vertical communication and integration of activitites

4. monitor ongoing activities for goal achievement

what’s used to explain the fundamental differences that set a business apart from other firms

mission statements

strengths of an organization

distinctive competence, strategic imitation, sustained competitive advantage

weaknesses of an organization

a skill or capability that does not enable an organization to choose and implement strategies that support its mission

distinctive competence

strength possessed by a small number of firms

strategic imitation

duplicating anothers competence into a valuable strategy

sustained competitive advantage

exists after all attempts at strategic imitation have ceased

organizational opportunities

an area in the environment that, if exploited, may generate higher performance

organizational threat

an area that increases the difficulty of an organization performing at a high level

introduction stage of PLC

high demand outpaces the firms ability to supply the product

growth stage of PLC

more firms begin producing the product and sales continue to grow

maturity stage of PLC

demand growth for product slows down and number of new firms producing the product begins to decline

decline stage of PLC

demand for product decreases, number of organizations producing the product drops, and total sales drop

satisficing

the tendency to search for alternatives only until one is found that meets some minimum standard of sufficiency

escalation of commitment

when a decision maker stays with a decision even when it appears to be wrong

classical model of decision making

assumes decisions will be in the organizations best interests

steps in classical decision making

1. obtain complete and perfect information

2. eliminate uncertainty

3. evaluate everything rationally and logically

steps in rational decision making

1. recognize and define the decision situation

2. identify alternatives

3. evaluate alternatives

4. select the best alternative

5. implement the chosen alternative

6. follow up and evaluate the results

progammed decisions

decision that is structured with frequency
ex. starting car in the morning

nonprogrammed decision

unstructured and occurs less often

ex. choosing a vacation

how does time play a factor in decision making

it depends on the situation, there are 3 time frames (long, intermediate, short)

what is evidence based management encourage?

experimentation and learning by doing

porter’s generic strategies

1. differentiation strategy

2. overall cost leadership strategy

3. focus strategy

differentation strategy

organization seeks to differentiate itself from competitors through the quality of its products or services

overall cost leadership strategy

attempts to gain a competitive advantage by reducing its costs below the costs of competing firms

focus strategy

an organization concentrates on a specific regional market, product line, or group of buyers

miles and snow typology

1. prospector strategy

2. defender strategy

3. analyzer strategy

4. reactor strategy

prospector strategy

firm encourages creativity and flexibility; decentralized

defender strategy

firm focuses on lowering costs and improving performance of current products

analyzer strategy

firm tries to maintain its current businesses and to be somewhat innovative in new businesses

reactor strategy

firm has no consistent approach to strategy

global effeciencies

locations efficiencies allow firms to locate wherever they can obtain cost advantage, economies of scale, economies of scope

economies of scale

lower the cost per unit of production due to large quantities

economies of scope

lower the cost per unit by sharing expenses across product lines

multimarket flexibility

gives firms ability to respond to change in one region by making changes in other regions

worldwide learning

gives firms advantage of adopting best practices from wherever they originate

three sources of competitive advantage

1. global efficiencies

2. multimarket flexibility

3. worldwide learning

dmaic problem solving process

1. define

2. measure

3. analyze

4. improve

5. control

tools for problem solving

1. the 5 why process

2. value stream mapping

3. 5S exercise

4. continuous improvement

state of certainty

decision maker knows what the alternatives are and what conditions are associated with each alternative

state of risk

moderate ambiguity and chances of a bad decision ex. contract negotiations, choosing health insurance for employees

state of uncertainty

decision maker doesnt know all alternatives and risks

evidence based management (EBM)

finding and using the best theory and data available at the time to make decisions

5 principles of EBM

1. build truthful culture

2. commit to fact based decision making

3. encourage experimentation and learning by doing

4. look for risks and drawbacks

5. avoid basing decision on untested but strongly held beliefs

risk propensity

the extent to which a decision maker is willing to gamble when making a decision

forms of group and team decision making

1. interacting group

2. delphi group

3. nominal group

interacting group

members openly discuss, argue, and agree on best alternative

delphi group

group arrives at a consensus of expert opinion

nominal group

structured technique used to generate alternatives and ideas