Exam 1 Study Guide
1. Define the following terms
Strategic management : The process through which organizations: -Analyze and learn from stakeholders inside and outside of the organization -Establish a strategic direction
-Create strategies that are intended to help achieve established goals, and execute those strategies… …all in an effort to satisfy key organizational stakeholders. External stakeholders (examples of these?)
Internal stakeholders (examples of these?): Internal stakeholders include managers, employees, the owners, and their representatives (e.g., board of directors) 2. What factors influence the broad environment?
3. What groups influence the task environment?
4. Define what is meant by Strengths and Weaknesses in a SWOT analysis. Strengths, Weaknesses, Opportunities and Threats. Strengths & weaknesses are internal or within the company. 5. Strategy formulation is often divided into what 3 levels? Briefly explain each. a. Corporate strategy formulation refers to domain definition, or the choice of business areas. Usually decided by the CEO and the board of directors. b. Business strategy formulation involves domain direction and navigation, or how to compete in a given area. Usually decided by division heads and business unit managers. c. Functional strategy formulation contains the details of how the functional areas such as marketing, operations, finance, and research should work together to achieve the business-level strategy. 6. Explain Environmental Determinism and Enactment. How are they different? Environmental Determinism- The best strategy involves adapting to environmental, technical and human forces. Strategy is deliberate (always planned and intended by management) Enactment – firms can, in part, create their environments
7. According to the Resource-Based View of the firm, an organization is a ________________, which fall into what 5 general categories? 8. A sustainable competitive advantage is an ________________ that is ________________ by competitors and thus leads to higher-than-average organizational performance over a long period of time. 9. Stakeholder analysis involves ________________ and ________________ key stakeholders, assessing their needs, collecting ideas from them, and integrating their knowledge into strategic management processes… 10. Explain Entrepreneurship, what it involves, and how it is relevant to strategic management. Entrepreneurship is the process through which individuals, groups or firms pursue opportunities to create new value. d. Recognizing or creating an opportunity
e. Assembling needed resources
f. Managing resources to bring new ventures into being
1. Do individual firms have more control over their broad environment or over their task environment?
2. What are the major social issues identified in exhibit 2.2 of the text?
3. Analysis of societal trends/sociocultural forces is important from at least what four perspectives? -Sociocultural Forces
-Political / Legal Forces
4. The text argues what six things are among the most critical economic factors? a. Economic growth
b. Interest rates
c. Availability of credit
d. Inflation rates
e. Foreign exchange rates
f. Foreign trade balances
5. To assess the effect of interdependent sociocultural and economic forces, organizations often model their business environments by proposing and evaluating different _________.” ……….These are often framed as ________________, _________________, and most likely. 6. Define the following terms