Management-Chapter 8

Question 1

Strategic Management

Answer 1

Refers to the set of decisions and actions used to formulate and implement strategies that will provide a competitively superior fit between the organization and its environment so as to achieve organizational goals.

Question 2

Strategy

Answer 2

The plan of action that describes resource allocation and activities for dealing with the environment, achieving a competitive advantage and attaining goals.

Question 3

Competitive Advantage

Answer 3

Refers to what sets the organiation apart from others and provides it with a distinctive edge in the marketplace.

Question 4

Core Competence

Answer 4

Something that the organization does particularly well in comparison to others.

Question 5

Synergy

Answer 5

When the organization’s parts interact to produce a joint effect that is greater than the sum of the parts acting alone.

Question 6

Corporate-Level Strategy

Answer 6

Pertains to the organization as a whole and the combination of business units and products that make it up.

Question 7

Business-Level Strategy

Answer 7

Pertains to each business unit or product line within the organization.

Question 8

Functional-Level Strategy

Answer 8

Pertains to the major functional departments within each business unit, such as manufacturing, marketing and research and development.

Question 9

Strategy Formation

Answer 9

The stage of strategic management that includes the planning and decision making that lead to the establishment of the organization’s goals and a specific strategic. plan

Question 10

SWOT Analysis

Answer 10

Managers often start with an audit or careful examination of strengths, weaknesses, opportunities and threats that affect organizational performance.

Question 11

Strategy Execution

Answer 11

The stage of strategic management that involves the use of managerial and organizational tools to direct resources toward achieving strategic outcomes.

Question 12

Portfolio Strategy

Answer 12

Pertains to the mix of strategic business units and product lines that fit together in a logical way to provide synergy and competitive advantage.

Question 13

Strategic Business Unit (SBU)

Answer 13

A division of the organization that has a unique business, mission, product or service line, competitors, and markets relative to other units of the same organizations.

Question 14

BCG Matrix

Answer 14

A concept developed by the Boston Consulting Group that evaluates SBU’s with respect to two dimensions- business growth rate and market share- and classifies them as cash cows, stars, question marks, or dogs.

Question 15

Diversification

Answer 15

The strategy of moving into new lines of business.

Question 16

Related Diversification

Answer 16

Moving into a new business that is related to the corporation’s existing business activities.

Question 17

Unrelated Diversification

Answer 17

Expanding into totally new lines of business.

Question 18

Vertical Integration

Answer 18

Some managers pursue diversification through this strategy which means expanding into businesses that either provide the supplies needed to make products or distribute and sell the company’s products.

Question 19

Differentiation Strategy

Answer 19

A strategy with which managers seek to distinguish the organization’s products and services from those of others in the industry.

Question 20

Cost Leadership Strategy

Answer 20

A strategy with which managers aggressively seek efficient facilities, cut costs, and use tight costs controls to be more efficient than others in the industry.

Question 21

Focus Strategy

Answer 21

Managers use either a differentiation or a cost leadership approach, but they concentrate on a specific regional market or buyer group.

Question 22

Globalization Strategy

Answer 22

Product design and advertising are standardized throughout the world.

Question 23

Multidomestic Strategy

Answer 23

Means that competition in each country is handled independently; product design and advertising are modified to suit the specific news of individual countries.

Question 24

Transnational Strategy

Answer 24

A strategy that combines global coordination to attain efficiency with local flexibility to meet needs in different countries.