BA FOUN EXAM III

EXAM III

This test covers Chapters 11, 12, 13 and 14. There are 50 questions worth a total of 150

points. There is one bonus question worth 2 points.



Chapter 11: Business Strategy for Competitive Advantage

  • Regulations, new competitors, etc.)



  • A helpful way to study would be to know what each tool is used for. 

Known/Unknown Matrix:

  • Used to determine the attractiveness of entering a new geographic territory

PESTLE Analysis:

  • Used to organize information to aid decision making under conditions of constant change and uncertainty

Porter’s 5 Forces: 

  • Used to determine the attractiveness of an industry

Competitor Analysis Matrix:

  •  Used to compare a company’s strengths and weaknesses vs other companies in their industry



Strategic Planning: 

  • The process of setting long-term goals and determining how to achieve them. It helps businesses identify strengths, weaknesses, opportunities, threats, align resources, and measure progress.



Strategic: Broad organizational goals and major decisions

Tactical: Implements the strategic plan

Operational: Implements tactical plans

Contingency: Backup plan if conditions change



What supports a strategic plan? Tactical plan

Which plan supports a tactical plan? Operational plan



Porter’s Five Forces – What is the purpose of Porter’s model? What does each force measure? Low is positive; High is negative.

  • Used to determine the attractiveness and profitability of an industry and whether a company should enter or remain in that industry

  • LOW FORCE=POSITIVE, HIGH FORCE=NEGATIVE

Competitive Rivalry- measures competition among existing firms

Bargaining Power of Suppliers- measures ability of suppliers to increase prices

Bargaining Power of Buyers- measures ability of customers to force lower prices

Threat of New Entrants- measures ease of new competitors entering the industry

Threat of Substitutes- measures availability of alternative products/services



PESTLE – For what purpose would a business organization use the PESTLE model? You should be able to recognize which of the PESTLE elements a company is assessing.

  • Used to evaluate the external environment that influences a business. These factors are outside a company's control

  • Political: Taxes, trade regulations, government stability

  • Economic: Inflation, GDP, interest rates, unemployment

  • Social: Culture, demographics, lifestyles, health trends

  • Technological: R&D, internet access, innovation

  • Legal: Employment laws, product safety laws, antitrust

  • Environmental: Climate change, pollution regulations, sustainability



Competitor Analysis Matrix – 

  • A tool that compares a company against competitors using important success factors.

  • Allows a company to compare strengths and resources, reveals strengths of  a company and where it might need improvement



SWOT Analysis – 

Internal factors

  • Strengths examples: patents, strong brand, skilled employees, loyal customers, etc.

  • Weaknesses examples: lack of resources, poor brand recognition, employee shortages, etc.

External factors

  • Opportunities: external factors that can help growth (ex. New tech, industry growth, geographic expansion)

  • Threats: external factors that may harm the company (ex. Economic downturns, govt. 

VRIO –

  • Used to determine whether a resource provides a sustainable competitive advantage. It looks inside the company rather than at the external environment.



Porter’s Four Generic Strategies – 

Cost Leadership

Lowest cost for a broad market

Differentiation

Unique products for a broad market

Cost Focus

Low cost within a niche market

Differentiation Focus

Unique products within a niche market

Focus = concentrating on a narrow/niche market rather than the entire market.



Growth Strategies – 

Diversification

  • Entering new industries or product categories.

Product Development

  • Creating new products for current markets. Example: Apple releasing a new iPhone.



New Markets (Geographic Expansion)

  • Entering new countries, states, or regions. Example: Starbucks opening stores internationally.



Mergers & Acquisitions (M&A)

  • Merger = Two firms combine; Acquisition = One firm buys another

Strategic Partnerships & Alliances

  • Businesses cooperate without merging. Example: Spotify and Uber partnership



VUCA and the Known-Unknown Matrix: 

V- Volatility; rapid change

U- Uncertainty; future is difficult to predict

C- Complexity; many interconnected variables

A- Ambiguity; unclear meanings, outcomes, or probabilities



Chapter 12: Management & Leadership



Know the Four Functions of Management – Planning, Organizing, Leading & Motivating, and

Controlling.

Planning

  • The process of deciding what the organization wants to achieve and how to achieve it. Considered the first and most important management function because the other functions depend on it

Organizing

  • Determining what needs to be done, how it will be done, involves allocating human and financial resources

Leading & Motivating

  • Influencing people to achieve goals and providing motivation and incentives for employees

Controlling

  • The process of evaluating results and taking corrective action when necessary.




The Decision Making Model is comprised of 5 steps. Which one is the most important?

What do we mean by “decision criteria”?

  • Defining the problem is the most important step. 

  • Decision criteria are the standards used to evaluate possible solutions like cost, productivity, quality, and time



Leadership Styles –

  • Directive Leadership: task-oriented. Leaders give commands, implement guidelines, closely supervise employees, ensure that rules are followed. Leaders seldom ask for input from employees

  • Transactional Leadership: Leaders use rewards and punishments as motivation tools. The leader sets goals that employees are expected to achieve

  • Empowering Leadership: Leaders encourage employees to take ownership of their work and provide them with the resources and support to achieve their goals. Self-leadership

  • Visionary Leadership: Leaders create visions that inspire employees and others. They trust their employees to make decisions and give them freedom to be creative

  • Situational Leadership: includes four approaches to supervising your employees based on your assessment of their level of skill (low or high) and their level of commitment to do the work (low or high). 

Low skill / high willingness → Directing

Low skill / low confidence → Coaching

High skill / low motivation → Supporting

High skill / high motivation → Delegating



Intrinsic Motivation: motivation from within, personal goals, etc

Extrinsic Motivation: motivation that comes from outside rewards



IQ will get you the job. EQ will get you promoted. 

EQ- emotional intelligence

IQ- intelligence quotient



Chapter 13: Human Resources Management

  • All of the questions are from the perspective of the organization, not the individual.



Be familiar with the following employment laws: 

Americans with Disabilities Act: cannot discriminate against qualified individuals with disabilities.

Must provide reasonable accommodations when possible. Applies to physical and mental disabilities.

Family and Medical Leave Act: protects employees in need of leave for family or medical reasons

Civil Rights Act of 1964: Employers may not discriminate in hiring, promotion, compensation, firing, or other employment decisions based on: race, color, religion, sex, etc.

Equal Pay Act of 1963: Men and women performing substantially the same job must receive equal pay.



Recruiting internally- improves morale, shows opportunities for advancement, and is faster hiring but leaves another vacancy to fill and has a smaller candidate pool

Recruiting externally- introduces new ideas and perspectives, can increase workforce diversity, but is more expensive and time-consuming, 



Orientation & onboarding – know the difference between these.

Orientation: A one-time event generally led by HR

Onboarding: A long-term process that can last up to 12 months (usually led by hiring manager)



Purpose of training: Teach employees skills needed for their current job. (Focuses on today’s job performance)

Purpose of development: Prepare employees for future roles and advancement. (Focuses on future career growth)

 

Direct compensation: i.e. salary, tips, commission, etc.

Indirect compensation: i.e. health insurance, PTO, retirement plans, etc.



Purpose of Performance Reviews – improved performance!

Q: How should performance reviews be conducted? 

  • A: achievement-oriented, fair and accurate, developmental. 



How can managers make performance reviews more achievement-oriented? Focus on specific examples, start with strengths, provide constructive feedback, include future-focused advice



Chapter 14: Communication in Business



Communication can be face-to-face or it can be mediated, which simply means… written communication whether in the form of a written document or report, a text message, social

media post, phone calls, etc. 



Mediated communication is anything that is not face-to-face.



Mediated communication may be prone to misunderstandings due to… the lack of non-

verbal cues such as tone of voice, body language or facial expressions.



Communication Styles – assertive, passive, passive-aggressive, and aggressive. You should

be able to distinguish between these if given an example of one or more of them.

Assertive: Expresses thoughts, feelings, and needs clearly while respecting others.

Passive: Avoids expressing opinions, feelings, or needs.

Passive-aggressive: Appears cooperative but indirectly expresses dissatisfaction.

Aggressive: Expresses needs forcefully while ignoring others' needs or feelings.



Barriers to Effective Communication include three of the communication styles listed: aggressive, passive-aggressive, and passive. 

Additional barriers include: lack of clarity and context, information overload, hierarchy and power dynamics, cultural differences, and emotional factors.



Listening Types – there are four ineffective listening styles (defensive, offensive, selective

and pretend) and one effective listening style (active listening). 

Defensive listening: listener feels threatened and focuses on preparing a response

Offensive listening: listener looks for mistakes or faults

Selective listening: only hears information they want to hear

Pretend listening: appears attentive but isn’t actually processing information

Active listening: focuses on genuinely understanding the speaker 



There are different listening styles (analytical, critical, relational, and task-oriented). Don’t

confuse critical listening style with offensive listening type. Know when to use each style of

listening. Given a scenario, you should be able to determine which listening style is appropriate for a given situation.



Managers can take several steps to minimize and control gossip, what are they? 



Persuasive communication using Monroe’s Motivated Sequence is used by sales people

and managers to convince their audience to adopt a particular point of view or take action.

Know the five steps of Monroe’s model