CIS TEST 1
Value Chain
Series of activities an organization performs to deliver value; includes primary activities (inbound logistics, operations, outbound logistics, marketing & sales, service) and support activities (procurement, technology, HR, infrastructure).
Decision Process
Steps: Define problem → Gather good information → Apply skills → Develop solutions → Execute solution → Monitor & evaluate → Learn from process.
Cognitive Bias
Mental distortions in decision-making, such as confirmation bias, stereotyping, heuristics, cheerleader effect, perception vs. reality, intuitive vs. logical thinking, decoy effect, and NIMBY.
Porter’s Five Forces
Threat of new entrants
Bargaining power of suppliers
Bargaining power of buyers
Threat of substitutes
Industry rivalry.
Bull-Whip Effect
Small shifts in consumer demand create larger swings in supply chain orders, causing inefficiencies and shortages/excess.
Structured Decision-Making
Predictable, quantifiable, with clear steps; based on logic and formal knowledge (e.g., payroll).
Unstructured Decision-Making
Unpredictable, hard to quantify, little to no defined process; relies on experience and intuition (e.g., new product design).
Systems Thinking
Viewing a business as an interconnected system; helps predict how one decision affects the whole organization.
Abstract Reasoning
Ability to create and manipulate models (diagrams, charts, maps) to represent complex processes.
Perfect Competition
Many firms, identical products, no pricing power.
Monopolistic Competition
Many firms, differentiated products, some pricing power.
Oligopoly
Few firms dominate the market; high barriers to entry.
Monopoly
One firm controls the market; total pricing power.
Cost Leadership Strategy
Competing by being the lowest-cost provider.
Differentiation Strategy
Competing by offering unique products or services.
Product Innovation
Developing new or improved goods.
Process Innovation
Improving how products are made or delivered.
Organizational Effectiveness
How well a company uses resources to achieve goals.
Customer Focus
Building strong relationships by meeting customer needs.
Disintermediation
Removing middlemen and selling directly to customers.
Channel Conflict
Tension between direct and indirect sales channels.
Goal of Marketers
Identify and meet customer needs profitably; create value and build long-term relationships.
Collaboration Purpose
Working together to solve problems, innovate, and share ideas.
Good Collaborator Traits
Communicates well, listens actively, gives constructive criticism, supports group goals, adaptable.
Constructive Criticism
Helpful, specific, respectful feedback that improves outcomes.
Project Management Constraints
Time, cost, and scope; balancing these determines project success.
Business Process Management (BPM)
Continuous improvement of processes through modeling, analysis, implementation, and monitoring.
Process Efficiency
Doing tasks with fewer resources, lower cost, or faster.
Process Effectiveness
Achieving desired outcomes; doing the right tasks.
Goods
Tangible items such as canoes, phones, clothing.
Services
Intangible activities such as consulting, banking, repairs.
RFM Analysis
Evaluates customers by Recency (last purchase), Frequency (how often), and Monetary value (how much they spend).
MRO Case – Sales & Profit
Sales up 5%, profits up only 1% → efficiency and cost issue.
MRO Case – Innovation
Only one new product in 2 years → product development gap.
MRO Case – Competition
New high-end competitor in Front Royal → threat of entrants.
MRO Case – Employees
Desire for flexible, engaged work environment; some employees left → HR and culture issue.
MRO Case – Legal/Policy
Lawsuits and higher insurance premiums; new safety regulations → government policy impact.
MRO Case – Industry Growth
Canoeing/kayaking industry projected to grow 8% in Eastern US; MRO grows 1.5× industry rate → growth opportunity.