ADM 1100 Final Exam Notes PDF

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Intro to Business Management 1100 Final Exam Notes for chapters 10-16...

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ADM 1100 - Business Final Exam Notes – Chapters 10, 12, 13, 14, 16 Chapter 10 The importance of strategic management What is a strategic management ● What managers do to develop organizations strategies Strategies ● Plans for how an organization will do what it’s in business to do, how it will compete successfully, and how it will attract and satisfy its customers ( all stakeholders) in order to achieve its goals Business model ● A Strategic design for how a company intends to profit from its strategies, work processes, and work activity ● Focuses on 2 things ○ Whether customers will value what the company is providing ○ Whether the company can make any money doing that Why is strategic management important 1. It results in higher organizational performance 2. It requires that managers examine and adapt to business environment changes, allowing them to better cope with uncertain environments 3. It’s involved in many of the decisions that managers take Non for profit and strategic management ● Moved beyond for-profit business organizations to include government agencies, hospitals, and other not for profit organizations ○ Ex. Canada Post

The strategic management process: ● A 6 step process that encompasses strategic planning, implementation and evaluation 1. Identify the organization's current mission, goals and strategies a. Mission: the firm's reason for being i. The scope of its products and services b. Goals: the foundation for further planning i. Measurable performance targets 2. Conduct an external analysis a. The environmental scanning of specific and general environments i. Focuses on identifying opportunities and threats b. Assessing organizational resources, capabilities, activities, and core competencies

i. Opportunities Positive trends in external environment factors ii. Threats Negative trends in external environmental factors 3. Conduct an internal Analysis- Terms a. Mission: a statement or organizations purpose b. Resources: an organization's assets-- financial, physical, human, intangible-- that are used to develop, manufacture, and deliver products or services to customers c. Capabilities: An organization skills and abilities that enable it to do the work activities needed in its business d. Core competencies: An organization's major value-creating skills, capabilities, and resources that determine its competitive advantage e. Assessing organisational resources, capabilities, activities, and core competencies i. Strengths ( core competencies) create value for the customer and strengthen the competitive position of the firm ii. Weaknesses ( things done poorly or not at all) can place the firm at a competitive disadvantage **** steps 2 and 3 combined are called a SWOT analysis ( Strengths, weaknesses, opportunities, and threats ) 4. Formulate strategies a. Develop and evaluate strategic alternatives b. Select appropriate strategies that provide relative advantage over competitors c. Match organizational strengths to environmental opportunities d. Correct weaknesses and guard against threats 5. Implement strategies a. Implementation: effectively fitting organisational structure and activities to the environment b. The environment dictates the chosen strategy; effective strategy implementation requires an organisational structure matched to its requirements 6. Evaluate results a. How effective have strategies been? b. What adjustments, if any, are necessary? Components of a mission statement ● Customers: who are the customers ● Markets: where does the firm compete geographically ● Concern for survival, growth, and profitability: Is the firm committed to growth and financial stability? ● Philosophy: what are the firm's basic beliefs, values, and ethical priorities? ● Concern for public image: how responsive is the firm to societal and environmental concerns? ● Products or services: what are the firms major products or services ● Technology: is the firm technologically current ● Self- concept: What are the firm's major competitive advantage and core competencies ● Concern for employees: are employees a valuable asset to the form

Organisational Strategies: ● An organisational strategy that evaluates what business a company is in, should be in, or wants to be in, and what it wants to do with those businesses Types of corporate strategy ● Growth: expansion into new products and markets ● Stability: maintenance of the status quo ● Renewal: address organizational weaknesses that are leading to performance declines Organisational level Strategies Growth strategy: Seeking to increase the organisations business by expanding the number of products offered or markets served, either through its current business or through its new businesses ● Types of growth strategies: ○ Concentration: Concentrates on a primary line of business and increases the number of products offered or markets served ○ Vertical integration ■ Backward vertical integration: attempting to gain control of inputs ( become its own supplier ■ Forward Vertical integration: an organiztions becomes its own distributor and is able to control its outputs ○ Horizontal integration: A company grows by combining with other organizations in the same industry-- that is, combining operations with competitors ■ Ex. Facebook bought instagram ○ Diversification: ■ Related Diversification: when a company grows by combining with forms in different , but related, industries EX. starbucks launched breakfast sandwiches ■ Unrelated diversification; when a company grows by combining with firms in different and unrelated industries EX. wireless launches radio Corporate level strategies ● Stability strategy: A strategy characterized by an absence of significant change in what the organization is currently doing-- same customers, processes, technology (niche market) ● Renewal Strategy: a strategy designed to address organizational weaknesses that are leading to performance declines Ex. canada post. ○ retrenchment : reduces the company's activities or operations ■ Cost Reductions, layoffs, closing underperforming units, closing entire product line or services EX, GM

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Turnaround : a renewal strategy for situations in which the organization's performance problems are more serious EX apple in the 80s launched MAC

How are corporate strategies manages Corporate portfolio analysis ● BCG Matrix ○ Developed by the Boston consulting group ○ Considers market share and industry growth rate ○ Classifies firmes as ■ Cash cows: low growth rate, high market share ■ Stars: high growth rate, high market shares ■ Question marks: high growth rate, low market shares ■ Dogs: low growth rate, low profit shares Competitive Strategy An organisational strategy that focuses on how the organization will compete in each of its businesses Competitive advantage: what sets an organization apart: its distinct edge Quality as a competitive Advantage: ● Differentiates the firm from its competitors ● Can create a sustainable competitive advantage ● Represents the company's focus on quality management to achieve constant improvement and meet customers demand for quality and reliability Social media as a competitive advantage ● Successful social media strategies should 1. Help people-- inside and outside the organization 2. Connect and reduce costs or increase revenue or both 3. Big data can be effective counterpart to the information exchange generated through social media Sustaining competitive advantage ● Every organization has resources (assets) and capabilities ( how work gets done) ● The trick is to effectively use these elements to create a sustainable competitive advantage Competitive strategies ● In any industry, 5 competitive forces dictate the rules of competition. Together they determine the industry attractiveness and profitability 1. Threat of new entrants: the ease or difficulty with which new competitors can enter an industry 2. threat of substitutes: the extent to which the switching costs and brand loyalty affect the likelihood of customers adopting substitute products and services

3. Bargaining power of buyers: the degree to which buyers have the market strength to hold sway over and influence competitors in the industry 4. Bargaining power of suppliers: degree of supplier concentration and availability of substitute inputs determine the amount of power that suppliers have over the firms in the industry 5. Current rivalry: intensity among rivals increases when industry growth rates slow, demand falls, and product prices descend Choosing a competitive strategy ● Once managers have assessed the five forces and determined what threats and opportunities exist, they are ready to select an appropriate competitive strategy Competitive strategies ● Cost leadership strategy: the organisation sets out to be the lowest-cost producer in its industry ● Differentiation strategy: a company seeks to offer unique products that are widely valued by customers ● Focus strategy: a company pursues a cost or differentiation advantage in a narrow industry segment ● Stuck in the middle: an organisation is unable to develop a competitive advantage through cost of differentiation Functional level strategies are the strategies that are used by an organisation various functional departments………. ● Marketing, human resources, research and development, and finance all support competitive advantage ● Problems occur when employees or customers don't understand a company's strategy ● Ie. how to support the business-level strategy Strategic leadership: the ability to anticipate, envision, maintain flexibility, think strategically, and work with others in the organization to initiate changes that will create a viable and valuable future for the organization Strategic flexibility: the ability to recognize major external environmental changes, to quickly commit resources, and to recognize when a strategic decision was a mistake First mover: an organisation that is first to bring a product innovation to the market or to use a new process innovation

Chapter 12 Define communication: the transfer and understanding of meaning Interpersonal communication: communication between two or more people Organizational communication: All the patterns, network, and systems of communications within an organisation

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do a communication to be successful, the meaning must be imparted and understood. If nothing has been imparted (conveyed/understood), communication hasn't taken place

What are the functions of communication? ● Control: formal and informal communications ● Motivation : comms clarify what is to be done to improve ● Emotional expression: social interaction allowing employees way to express themselves ● Information: individuals and work groups need info to make decisions or do work Methods of interpersonal communication Message: a purpose to be conveyed; actual product encoded by source ( written documents, oral speech, gestures, facial expressions) Encoding: converting a message into symbols ( words, symbols, pictures, sounds) Channel: the medium a message travels along ( variety of channels…) sometimes advantageous to use multiple channels… decrease distortion, increase probability Decoding: a receivers translation of sender's message ( limited by skills, knowledge, attitudes) (interpersonal communications process: the seven elements involved in transferring meaning from one person to another ( to follow) Noisee: disturbances that interfere with the transmission recept, or feedback of a message (barriers) Communications channels ● Face to face, telephone, group meetings, formal presentations, memos, postal mail, fax, publications, bulletin boards, audi/videotapes, hot lines, email, computer conference, voice mail, teleconference, video conference 12 questions to help evaluate communication methods 1. Feedback: how quickly can recover respond 2. Complexity capacity: effectively process complex messages 3. Breadth potential:l how many different methods can be transmitted 4. Confidentiality: Who they want the message to go to 5. Encoding ease: easily and quickly 6. Decoding ease: decode easily and quickly 7. Ime- space constraint: do they need to communicate the same time same space 8. Cost: how much 9. Interpersonal warmth: how well does it convey this 10. Formality: needed amount of formality 11. Scannability: messaged easily browsed or scanned 12. Time of consumption: sender or receiver has full control over when the message is dealt with Nonverbal communication: without words Body language: gestures, facial expressions, and other body movements that convey meaning

Verbal intonation (paralinguistics): an emphasis given to words or phrases that conveys meaning

Barriers to effective interpersonal communications: Filtering: the deliberate manipulation of information to make it appear more favourable to the recevoir Emotions: disregarding rational and objective thinking processes and substituting emotional judgements when interpreting messages Information overload: when the information we have to work with exceeds our processing capacity Selective perception: individuals interpret “reality” based on their own needs, motivations, experience, background, and other personal characteristics Defensiveness: when threatened, reacting in a way that reduces the ability to achieve mutual understanding Language: the different meanings of and specialized ways (jargon) in which lenders use words can cause recevors to misinterpret their messages Jargon: specialized terminology or technical language that members of a group use to communicate among themselves Overcoming barriers to communicate ● Use feedback: communication problems are less likely to occur if individuals use the feedback loop in the communications process, either verbally or non verbally ● Simplify language : managers should choose words and structure their messages in ways that will make those messages clean and understandable to the receiver ● Listen actively: listening for full meaning without making premature judgement or interpretations ● Constrain emotions : a manger who is emotionally upset over an issue should refrain from communicating until he or she has regained composure ● Watch nonverbal cues: effective communicator watches his or her nonverbal cues to ensure that they convey the desired message Organizational communication Formal communication: communication that follows the official chain of command or is part of the communication required to do one's job Informal communication: communication that is not defined by the organization's hierarchy ● Permits employees to satisfy their needs for social interaction ● Can improve an organization's performance by creating faster and more effective channels of communication Direction of communication flow Downward: communications that flow from managers to employees to inform, direct, coordinate, and evaluate employees

Town hall meeting: informal public meetings whereby information can be relayed, issues can be discussed, or employees can gather to celebrate accomplishments Upward: communications that flow from employees up to managers to keep them aware of employees needs and how things can be improved to create a climate of trust and respect Lateral ( horizontal communication: communication that takes place among employees on the same organizational level Diagonal communication: communication that cuts across both work areas and organizational levels Communication network: the variety of patterns of vertical and horizontal flows of organizational communication

Organizational communication networks: Chain network: communication flows according to the formal chain of command, both upward and downward Wheel network: all communication flows in and out though the group leader (hub) to others in the group All-channel network: communication flows freely among all members of the work team The grapevine: the informal organizational communication network ● Provides a channel for issues not suitable for formal communication channels ● The impact of information passed along the grapevine can be countered by open and honest communication with employees Workplace design and communication Another factor that influences organizational communication is workplace design ● Much of an organization's communication still occurs in the workplace. In fact, sone 74% of an employees average workweek is spent in an office ● How that office workspace is designed and configured can affect the communication that occurs as well as the influence an organization's overall performance Open vs closed workplaces ● Workplaces with faw/many physical barriers and enclosures

Network systems have ● Significantly improved a manager's ability to monitor individual and team performance ● Allowed employees to have more complete information to make faster and better decisions ● Allowed more collaboration and sharing of information ● Greater accessibility to coworkers any time, regardless of where they are Privacy issues

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The widespread use of voice mail and email at work has led to some ethical concerns as well. These forms of communication are not necessarily private, because employers have access to them Many private sector employees are not covered by privacy legislation, as not all provinces have enacted legislation that protects private sector employees

Communication issues in today's organization Managing communication in an internet world: New technology has created special communication challenges: 1. Legal and security issues 2. Personal interaction Managing the organization's knowledge resources ● Build on-line information databases that employees can access ● Create “ communities of practice” for groups of people who share a concern, share expertise, and interact with each other Communities of practice: groups of people 3ho share a concern, a set of problemes, or a passion about a topic, and who deepen their knowledge and expertise in that area by interacting on an ongoing basis Getting employee input: in today's challenging environment, companies need to get input from their employees ● How to let employees know their input matters: town hall meetings, provide information, invest in training, analyze problemes together, make it easy Communicating ethically: it's particularly important today that a company's communication efforts be ethical. Communication that includes all relevant information, is true in every sense, and is not deceptive in any way Guidelines for encouraging ethical communications ● Has the situation been defines fairly and accurately ● Why is the message being communicated ● How will the people who may receive or affected by the message be impacted ● Does the message help achieve the greatest possible good while minimizing the possible harm ● Will the decision that appears to be ethical now seem so in the future ● How comfortable are you with your communication effort? What would a person you admire think of

Chapter 13 (Managing Human Resources) The Human Resources Management Process Why Human Resources Management is Important ● It can be a significant source of competitive advantage - HR gives an organization an edge by creating superior shareholder value. ●

An important part of organizational strategies - Achieving competitive success through people means managers must change how they think about their employees and how they view the work relationship.

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Adds value to the firm - High performance work practices lead to both high individual and high organizational performance.

High-performance work practices: Work practices that lead to both high individual and high organizational performance. Human Resources for Non-HR Managers Small vs. large organizations - Large organizations have HR function. - Smaller organizations may rely on managers to handle HR issues. - All managers need to be aware of federal and provincial legislation and company policies. Human resource management process: Activities necessary for staffing the organization and sustaining high employee performance. External Factors That Affect the HRM Process: The Economy - The global economic downturn has left what many exp...