Key Terms in Strategic Management
Key Terms in Strategic Management
Competitive Advantage * Anything that a firm does especially well compared to rival firms.
* A firm must strive to achieve competitive advantage by: 1) Continually adapting to changes in external trends and events and internal capabilities, competencies and resources. 2) Effectively formulating, implementing and evaluating strategies that capitalize on those factors.
Strategists
* Usually found in high levels of management (CEO) * Help organization gather, analyze, and organize information * Track industry and competitive trends * Develop forecasting model * Evaluate corporate and divisional performance
Vision and Mission
Vision
* Answers the question “What do we want to become”
Example: “Happiest customers and employees” – Globe Telecom
Mission
* A mission statement identifies the scope of a firm’s operations in product and market terms. It answers the question “What is our business?”.
Example: “Transform the lives of people, businesses and communities through innovative solutions” – Globe Telecom
External Opportunities and Threats * Largely beyond the control of a single organization. * Significantly benefit or harm the organization in the future. * A basic principle of Strategic Management is that firms should formulate strategies that take advantage of external opportunities and to avoid or reduce the impact of external threats. * Identify, monitor and evaluate the external opportunities and threats.
* Environmental Scanning * Is the process of conducting research and gathering and assimilating external information.
Internal Strengths and Weaknesses * Organization’s controllable activities that are performed especially well or poorly. * Strengths and weaknesses are determined relative to competitors and relative to the firm’s objectives. * Organizations strive to pursue strategies that capitalize on
Competitive Advantage * Anything that a firm does especially well compared to rival firms.
* A firm must strive to achieve competitive advantage by: 1) Continually adapting to changes in external trends and events and internal capabilities, competencies and resources. 2) Effectively formulating, implementing and evaluating strategies that capitalize on those factors.
Strategists
* Usually found in high levels of management (CEO) * Help organization gather, analyze, and organize information * Track industry and competitive trends * Develop forecasting model * Evaluate corporate and divisional performance
Vision and Mission
Vision
* Answers the question “What do we want to become”
Example: “Happiest customers and employees” – Globe Telecom
Mission
* A mission statement identifies the scope of a firm’s operations in product and market terms. It answers the question “What is our business?”.
Example: “Transform the lives of people, businesses and communities through innovative solutions” – Globe Telecom
External Opportunities and Threats * Largely beyond the control of a single organization. * Significantly benefit or harm the organization in the future. * A basic principle of Strategic Management is that firms should formulate strategies that take advantage of external opportunities and to avoid or reduce the impact of external threats. * Identify, monitor and evaluate the external opportunities and threats.
* Environmental Scanning * Is the process of conducting research and gathering and assimilating external information.
Internal Strengths and Weaknesses * Organization’s controllable activities that are performed especially well or poorly. * Strengths and weaknesses are determined relative to competitors and relative to the firm’s objectives. * Organizations strive to pursue strategies that capitalize on