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BUSM112 - CH 05
CH 05 : Foundations of Planning
| Term | Definition |
|---|---|
| Strategic Management | What managers do to develop an organizations strategies. |
| Strategies | Plans for how the organization will do what it's in business to do, how it will compete successfully, and how it will attract its customers in order to achieve its goals. |
| Strategic Management Process | A six-step process that encompasses strategy planning, implementation, and evaluation. |
| Mission | A statement of an organization's purpose. |
| Opportunitities | Positive trends in the external environment. |
| Threats | Negative trends in the external environment. |
| Resources | An organization's assets that it uses to develop, manufacture, and deliver products to its customers. |
| Capabilities | An organization's skills and abilities in doing the work activities needed in its business. |
| Core Compentencies | The major value-creating capabilities of an organization. |
| Strengths | Any activities the organization does well or any unique resource that it has. |
| Weakenesses | Activities the organization doesn't do well or resources that it needs but doesn't possess. |
| SWOT Analysis | The combined external and internal analyses. |
| Corporate Strategy | An organizational strategy that specifies what businesses a company is in or wants to be in and what it wants to do with those businesses. |
| Growth Strategy | A corporate strategy in which an organization expands the number of markets served or products offered either through its current business(es) or through new business(es). |
| Stability Strategy | A corporate strategy in which an organization continues to do what it is currently doing. |
| Renewal Strategy | A corporate strategy that addresses declining organizational performance. |
| Competitive Strategy | An organizational strategy for how an organization will compete in its business(es). |
| Strategic Business Units (SBU's) | An organization's single businesses that are independent and formulate their own competitive strategies. |
| Competitive Advantage | What sets an organization apart; its distinctive edge. |
| Cost Leadership Strategy | When an organization competes on the basis of having the lowest costs in its industry. |
| Differentiation Strategy | When an organization competes on the basis of having unique products that are widely valued by customers. |
| Focus Strategy | When an organization competes in a narrow segment or niche with either a cost focus or differentiation focus. |
| Functional Strategy | Strategy used in an organization's various functional departments to support the competitive strategy. |
| Benchmarking | The search for the best practices among competitors or noncompetitors that lead to their superior performance. |
| Goals (Objectives) | Desired outcomes or targets. |
| Plans | Documents that outline how goals are going to be met |
| Stated Goals | Official statements of what an organization says, and wants its stakeholders to believe, its goals are. |
| Real Goals | Those goals an organization actually pursues as shown by what the organization's members are doing. |
| Traditional Goal Setting | Goals set by top managers flow down through the organization and become subgoals for each organizational area. |
| Means-End Chain | An integrated network of goals in which higher-level goals are linked to lower-level goals, which serve as the means for their accomplishment. |
| Management by Objectives (MBO) | A process of setting mutually agreed-upon goals and using those goals to evaluate employee performance. |
| Strategic Plans | Plans that apply to the entire organization and encompass the organization's overall goals. |
| Tactical Plans | Plans that specify the details of how the overall goals are to be achieved. |
| Long-Term Plans | Plans with a time frame beyond three years. |
| Short-Term Plans | Plans with a time frame of one year or less. |
| Specific Plans | Plans that are clearly defined and leave no room for interpretation. |
| Directional Plans | Plans that are flexible and set general guidelines. |
| Single-Use Plan | A one-time plan specifically designed to meet the needs of a unique situation. |
| Standing Plans | Plans that are ongoing and provide guidance for activities performed repeatedly. |
| Commitment Concept | The idea that plans should extend far enough to meet those commitments made when the plans were developed. |
| Formal Planning Department | A group of planning specialists whose sole responsibility is to help write the various organizational plans. |
| Environmental Scanning | An analysis of the external environment, which involves screening large amounts of information to detect emerging trends. |
| Competitive Intelligence | A type of environmental scanning that gives managers accurate information about competitors. |
| What is the Nature and Purposes of Planning? | Planning (primary mgmt function) establishes the basis for all other things managers do. Formal planning includes specific goals covering specific time period. They're defined & written down. Plans are developed to make sure they're met. |
| What are the Four Reasons Why Managers Should Plan? | 1)Establishes coordinated efforts. 2)Reduces uncertainty. 3)Reduces overlapping/wasteful activities. 4)Establishes goals or standards used in controlling work. |
| What Do Managers Do in the Strategic Management Process? | They develop the organization's strategies in the six-step strategic management process encompassing strategy planning, implementation and evaluation. |
| What are the Six Steps of the Strategic Management Process? | 1)ID organization's current mission, goals & strategies. 2)External analysis. 3)Internal analysis. Steps 2&3 together called SWOT. 4)Formulate strategies. 5)Implement strategies. 6)Evaluate results. |
| What is the End Results of the Strategic Management Process? | A set of corporate, competitive and functional strategies that allow the organization to do what it's in business to do and achieve its goals. |
| How are Most Company's Goals Classified? | As either strategic or financial; stated or real. Traditionally goals flow down from top mgrs thru the org. Management by objectives can also be used, which is a process of setting mutually agreed-upon goals & using them to evaluate employee performance. |
| How are Most Company's Plans Classified? | Described in terms of their breadth, time frame, specificity and frequency of use. Can be developed by formal planning dept or by involving more organizational members in the process. |
| What are Some Contemporary Issues in Planning? | Planning in dynamic environments (developing specific but flexible plans); continuing to plan in uncertain environments; environmental scanning (competitive intel). |
Created by:
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