Management 300 Week 6 Notes
Management 300 Week 6 Notes Management 300
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This 4 page Class Notes was uploaded by Danielle Grek on Friday February 20, 2015. The Class Notes belongs to Management 300 at Arizona State University taught by in Spring2015. Since its upload, it has received 71 views.
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Date Created: 02/20/15
Management Week 6 Notes Business plan a document that outlines a proposed firm39s goals the strategy for achieving them and the standards for measuring success trategy a largescale action plan that sets the direction for an organization Strategic management a process that involves managers from all parts of the organization in the formulation and the implementation of strategies and strategic goals An organization should adopt strategic management and strategic planning because they can provide direction and momentum encourage new ideas and develop a sustainable competitive advantage Sustainabe competitive advantaoe occurs when an organization is able to get and stay ahead in four areas being responsive to customers innovating quality and effectiveness Strateoic planning is only performed by top level managers Strateoic positionino it attempts to achieve sustainable competitive advantage by preserving what is distinctive about a company Porter 3 key principles in strategic positioning 1 Strategy is the creation of a unique and valuable position Three sources few needs many customers broad needs few customers broad needs many customers 2 Strategy requires tradeoffs in competing 3 Strategy involves creating a quotfitquot among activities StrategicManagement Process steps 1 Establish the mission and the vision 2 Establish the grand strategy after an assessment of current organizational performance then explains how the organization39s mission is to be accomplished Three common grand strategies are growth stability and defensive Growth Strategy a grand strategy that involves expansion as in sales revenues market share number of employees or number of customers or clients served tability Strategy a grand strategy that involves little or no signi cant change The company is trying to maintain the status quo Defensive Strateov a grand strategy that involves reduction in the organization39s efforts 3 Formulate Strategic Plans Strateov formulation is the process of choosing among different strategies and alerting them to best t the organization39s needs 4 Carry out the strategic plans through strategy implementation 5 Maintain strategic control through the feedback loop Strategic control consists of monitoring the execution of strategy and making adjustments if needed To keep the strategic plan on course you need to engage people keep it simple stay focused and keep moving Competitive intellioence gaining information about one s competitors39 activities so that you can anticipate their moves and react appropriately Gain this intelligence from public prints and advertising investor information and informal sources Environmental scannino careful monitoring of an organization39s internal and external environments to detect early signs of opportunities and threats that may in uence the rm39s plans SWOT analvsis the process of environmental scanning by searching for Strengths Weaknesses Opportunities and Threats affecting the organization situational analysis Oroanizational Strenoths the skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its mission Oroanizational Weaknesses the drawbacks that hinder an organization in executing strategies in pursuit of its mission Organizational Opportunities environmental factors that the organization may exploit for competitive advantage Externally Organizational Threats environmental factors that hinder an organization39s achieving a competitive advantage m a vision or projection of the future Trend analvsis a hypothetical extension of a past series of events into the future Using statistical analysis of historical data to predict future events Contingency planning scenario analysis the creation of alternative hypothetical but equally likely future conditions Porter s 5 Competitive Forces 1 Threats of New Entrants 2 Bargaining Power of Suppliers 3 Bargaining Power of Buyers 4 Threats of Substitute Products or Services 5 Rivalry Among Competitors Porter39s 4 Competitive Strategies 1 Costleadership strategy to keep the costs and prices of a product or service below those of competitors and to target a wide market 2 Differentiation strategy to offer products or services that are of unique and superior value compared with those of competitors but to target a wide market Use of brands 3 Costfocus strategy to keep the costs and prices of a product or service below those of competitors and to target a narrow market 4 Focuseddifferentiation strategy to offer products or services that are of unique and superior value compared to those of competitors and to target a narrow market Singleproduct strategy a company makes and sells only one product within its market The bene t is focus but the risk is vulnerability Diversi cation operating several businesses in order to spread the risk Unreated diversi cation operating several businesses under one ownership that are not related to one another This is what a conglomerate uses Related diversi cation when an organization under one ownership operates separate businesses that are related to one another This has 3 advantages 1 Reduced risk because it has more than one product 2 Management ef ciencies because administration is spread over several businesses 3 Synergy because the sum is greater than the parts ynergy the economic value of spate related businesses under one ownership and management is greater together than the businesses are worth separately BCG matrix a means of evaluating strategic business units on the basis of their business growth rates and their share of the market Quadrants of the BCG matrix Stars have high growth and market share They are keepers Cash cows have slow growth but high market share Their income nances stars and question marks Question marks risky new ventures Some will become stars and others dogs Dogs Have low growth and low market share They should be gotten rid of Execution not simply tactics but a central part of a company39s strategy It consists of using questioning analysis and followthrough to mesh strategy with reality align people with goals and achieve the results promised Bossidy amp Charan Execution Core Processes of Business 1 2 People you need to consider who will bene t you in the future Strategy you need to consider how success will be accomplished 3 Operations you need to consider what path will be followed Execution foundation is built on managers engaging in 7 kinds of behavior 1 OWUIhUJN 7 Know your people and your business by engaging with employees lnsist on realism by not letting others avoid reality Set clear priorities by focusing on a few rather than many goals Follow through by establishing accountability and check on results Reward the doers to show that top performance matters Expand people39s capabilities by developing the talent Know yourself by doing hard work and understanding who you are SMART goal A goal that is Speci c Measurable Attainable Results oriented and has Target dates In order to successfully implement strategic plans at the lowerlevel of the organization top managers must ensure the organization39s structure culture and control system is prepared
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