Strategic Management Flashcards

Flashcards on Strategic Management and Competitive Forces

Romantic View of Leadership

The belief that the leader is the key force determining an organization's success.

External Control View of Leadership

The belief that external forces, where the leader has limited influence, determine an organization's success.

Strategy

The ideas, decisions, and actions that enable a firm to succeed, directing it toward goals and objectives.

Intended Strategy

Strategy in which organizational decisions are determined only by analysis; what we planned.

Realized Strategy

Strategy in which organizational decisions are determined by both analysis and unforeseen environmental developments; what we did.

Emergent Strategy

What we did but did not plan.

Stakeholders

Individuals who have a stake in the company (employees, customers, suppliers, owners, community, etc.).

Stakeholder Management

A firm's strategy for recognizing and responding to the interests of its salient stakeholders.

Shareholder Approach

Prioritizes maximizing the interests of shareholders; focuses on profit creation for investors.

Zero-Sum Game

The idea that stakeholders compete with each other; making one happy makes another less happy.

Symbiosis

The idea that stakeholders depend upon each other; making employees happy increases profits and investor satisfaction.

Triple Bottom Line

Assessment of a firm's financial, social, and environmental performance.

Vision

Organizational goals that evoke a powerful and compelling mental image; more general and long-term.

Mission

Set of organizational goals that include the purpose of the organization, its scope of operations, and the basis of its competitive advantage; more specific and short-term.

Strategic Objectives

Specific, measurable, appropriate, realistic, and timely goals.

Financial Ratio Analysis

A method for evaluating firm performance through historical comparisons, comparisons with industry, and comparisons with key competitors.

Industry

Composed of established competitors, substitutes, suppliers and buyers.

Economies of Scale

The larger the volume of products, the cheaper it is to produce each single product.

Bargaining Power of Buyers

The ability of buyers to reduce industry profitability by forcing prices down.

Bargaining Power of Suppliers

The ability of suppliers to influence industry profitability often stemming in high concentration of suppliers.

Threat of Substitute Products and Services

The risk that a similar product could replace the need for another product.

Rivalry Among Competitors

The intensity of reciprocal competitive attacks among established competitors that reduce profit margins.

Complements

Products or services that have an impact on the value of a firm’s products or services (e.g., cars and tires).

Strategic Group within Industries

Clusters of firms that share similar strategies.