Exam revision - review notes for exams PDF

Preview

Summary

review notes for exams...

Description

Chapter 6 Acquisition The purchase of a company by another company (p. 92) Analyzers Those who adopt an adaptive strategy that seeks to minimize risk and maximize profits by following or imitating the proven successes of prospectors (p. 97) Attack A competitive move designed to reduce a rival's market share or profits (p. 100) Bargaining power of buyers A measure of the influence that customers have on a firm's prices (p. 96) Bargaining power of suppliers A measure of the influence that suppliers of parts, materials, and services to firms in an industry have on the prices of these inputs (p. 96) BCG matrix A portfolio strategy, developed by the Boston Consulting Group, that categorizes a corporation's businesses by growth rate and relative market share and helps managers decide how to invest corporate funds (p. 93) Cash cow A company with a large share of a slow-growing market (p. 93) Character of the rivalry A measure of the intensity of competitive behaviour between companies in an industry (p. 95) Competitive advantage Providing greater value for customers than competitors can (p. 85) Competitive inertia A reluctance to change strategies or competitive practices that have been successful in the past (p. Core capabilities The internal decision-making routines, problem-solving processes, and organizational cultures that determine how efficiently inputs can be turned into outputs (p. 88) Core firms The central companies in a strategic group (p. 89) Cost leadership The positioning strategy of producing a product or service of acceptable quality at consistently lower production costs than competitors can, so that the firm can offer the product or service at the lowest price in the industry (p. 96) Defenders 1

Those who adopt an adaptive strategy aimed at defending strategic positions by seeking moderate, steady growth and by offering a limited range of high-quality products and services to a well-defined set of customers (p. 97) Differentiation The positioning strategy of providing a product or service that is sufficiently different from competitors' offerings that customers are willing to pay a premium price for it (p. 97) Direct competition The rivalry between two companies that offer similar products and services, acknowledge each other as rivals, and react to each other's strategic actions (p. 98) Distinctive competence What a company can make, do, or perform better than its competitors (p. 88) Diversification A strategy for reducing risk by owning a variety of items (stocks or, in the case of a corporation, types of businesses) so that the failure of one stock or one business does not doom the entire portfolio (p. 92) Dog A company with a small share of a slow-growing market (p. 93) Firm-level strategy A corporate strategy that addresses the question “How should we compete against a particular firm?” (p. 98) Focus strategy The positioning strategy of using cost leadership or differentiation to produce a specialized product or service for a limited, specially targeted group of customers in a particular geographic region or market segment (p. 97) Grand strategy A broad corporate-level strategic plan used to achieve strategic goals and guide the strategic alternatives that managers of individual businesses or subunits may use (p. 94) Growth strategy A strategy that focuses on increasing profits, revenues, market share, or the number of places in which the company does business (p. 94) Imperfectly imitable resources Resources that are impossible or extremely costly or difficult for other firms to duplicate (p. 86) Industry-level strategy A corporate strategy that addresses the question “How should we compete in this industry?” (p. 95) Market commonality

2

The degree to which two companies have overlapping products, services, or customers in multiple markets (p. 99) Nonsubstitutable resource A resource that produces value or competitive advantage and has no equivalent substitutes or replacements (p. 87) PEST An acronym that stands for the Political, Economic, Social/Demographic, and Technological factors that affect a company and shape the company's strategy (p. 89) Portfolio strategy A corporate-level strategy that minimizes risk by diversifying investment among various businesses or product lines (p. 92) Prospectors Those who adopt an adaptive strategy that seeks fast growth by searching for new market opportunities, encouraging risk taking, and being the first to bring innovative new products to market (p. 97) Question mark A company with a small share of a fast-growing market (p. 93) Rare resources Resources that are not controlled or possessed by many competing firms (p. 86) Reactors Those who take an adaptive strategy of not following a consistent strategy, but instead reacting to changes in the external environment after they occur (p. 98) Recovery The strategic actions taken after retrenchment to return to a growth strategy (p. 95) Related diversification Creating or acquiring companies that share similar products, manufacturing, marketing, technology, or cultures (p. 94) Resource similarity The extent to which a competitor has similar amounts and kinds of resources (p. 99) Resources The assets, capabilities, processes, information, and knowledge that an organization uses to improve its effectiveness and efficiency, create and sustain competitive advantage, and fulfill a need or solve a problem (p. 85) Response A competitive countermove, prompted by a rival's attack, to defend or improve a company's market share or profit (p. 100) 3

Retrenchment strategy A strategy that focuses on turning around very poor company performance by shrinking the size or scope of the business (p. 95) Secondary firms The firms in a strategic group that follow strategies related to but somewhat different from those of the core firms (p. 89) Situational (SWOT) analysis An assessment of the strengths and weaknesses in an organization's internal environment and the opportunities and threats in its external environment (p. 87) Stability strategy A strategy that focuses on improving the way in which the company sells the same products or services to the same customers (p. 95) Star A company with a large share of a fast-growing market (p. 93) Strategic dissonance A discrepancy between a company's intended strategy and the strategic actions managers take when implementing that strategy (p. 87) Strategic group A group of companies within an industry that top managers choose to compare, evaluate, and benchmark strategic threats and opportunities (p. 89) Strategic reference points The strategic targets managers use to measure whether a firm has developed the core competencies it needs to achieve a sustainable competitive advantage (p. 90) Sustainable competitive advantage A competitive advantage that other companies have tried unsuccessfully to duplicate and have, for the moment, stopped trying to duplicate (p. 86) Threat of new entrants A measure of the degree to which barriers to entry make it easy or difficult for new companies to get started in an industry (p. 96) Threat of substitute products or services A measure of the ease with which customers can find substitutes for an industry's products or services (p. 96) Unrelated diversification Creating or acquiring companies in completely unrelated businesses (p. 92) Valuable resource A resource that allows companies to improve efficiency and effectiveness (p. 86)

4

CHAPTER 7 INNOVATION AND CHANGE Change agent The person formally in charge of guiding a change effort , Change forces Forces that produce differences in the form, quality, or condition of an organization over time (p. 113) Chang ervention The process used to get workers and managers to change their behaviour and work practices Coerci Using formal power and authority to force others to change (p. 115) Compression approach to innovation An approach to innovation that assumes that incremental innovation can be planned using a series of steps a that compressing those steps can speed innovation (p. 111) Creati ork environments Workplace cultures in which workers perceive that new ideas are welcomed, valued, and encouraged (p. 108 Creativity The production of novel and useful ideas (p. 103) Design competition Competition between old and new technologies to establish a new technological standard or dominant design (p. 105) Design iteration A cycle of repetition in which a company tests a prototype of a new product or service, improves on that d n, and then builds and tests the improved prototype (p. 109) Discon ous change The phase of a technology cycle characterized by technological substitution and design competition (p. 105) Dominant design A new hnological design or process that becomes the accepted market standard (p. 105) Experiential approach to innovation An app ch to innovation that assumes a highly uncertain environment and uses intuition, flexible options, and hands-on experience to reduce uncertainty and accelerate learning and understanding (p. 109 Flow

5

A psychological state of effortlessness, in which you become completely absorbed in what you're doing time seems to pass quickly (p. 108) Gener ectric workout A three-day meeting in which managers and employees from different levels and parts of an organization quickly generate and act on solutions to specific business problems (p. 117) Generational change Change based on incremental improvements to a dominant technological design such that the improved technology is fully backward compatible with the older technology (p. 111) Incremental change The ph of a technology cycle in which companies innovate by lowering costs and improving the functioning and performance of the dominant technological design (p. 107) Innova streams Patterns of innovation over time that can create sustainable competitive advantage (p. 105) Milestones Formal project review points used to assess progress and performance (p. 110) Multifunctional teams Work ms composed of people from different departments (p. 110) Organ onal change A difference in the form, quality, or condition of an organization over time (p. 103) Organizational decline A large decrease in organizational performance that occurs when companies don't anticipate, recognize, neutralize, or adapt to the internal or external pressures that threaten their survival (p. 112) Organ onal development A philosophy and collection of planned change interventions designed to improve an organization's long-t health and performance (p. 118) Organ onal innovation The successful implementation of creative ideas in organizations (p. 103) Product prototype A full-scale, working model that is being tested for design, function, and reliability (p. 109) Refreezing Supporting and reinforcing new changes so that they stick (p. 114) Resistance forces Forces t support the existing state of conditions in organizations (p. 113)

6

Resista to change Opposition to change resulting from self-interest, misunderstanding and distrust, a low tolerance for change, and time and cost factors (p. 113) Results-driven change Change created quickly by focusing on the measurement and improvement of results (p. 117) S-curve pattern of innovation A patt of technological innovation characterized by slow initial progress, then rapid progress, and then slow progress again as a technology matures and reaches its limits (p. 103) Technological discontinuity A scien advance or a unique combination of existing technologies creates a significant breakthrough in performance or function (p. 105) Technological lockout When a new dominant design (i.e., a significantly better technology) prevents a company from competitively selling its products or makes it difficult to do so (p. 107) Technological substitution The purchase of new technologies to replace older ones (p. 105) Technology cycle A cycle t begins with the birth of a new technology and ends when that technology reaches its limits and is replaced by a newer, substantially better technology (p. 103) Testing The systematic comparison of different product designs or design iterations (p. 109) Unfreezing Getting the people affected by change to believe that change is needed (p. 114)

1.

Radio Shack created big-box Incredible Universe that expanded to 17 stores within four years. ever, due to the massive overhead, managers could not reverse the losses being incurred. Radio Shack shut down Incredible Universe. Which of the following is this an example of? a. organizational milestones b. organizational change c. a creative work environment d. organizational innovation

7

2.

Which of the following occurred when CDs replaced audiotapes in the recording industry? a. technological discontinuity b. design iteration c. incremental change d. discontinuous change

3.

Which of the following occurred when William purchased a DVD player to replace his ocassette player? a. compression b. technological substitution c. generational change d. experiential discontinuity

4.

Virginia Dare is a primary producer of vanilla, tea, coffee, and cocoa extracts as well as an almost unlimited array of fruit, citrus, berry, dairy, brown, sweet, and nut flavours. At the heart of every Virginia Dare flavour is the spirit of innovation. It is continually developing and testing new product prototypes. From this information, what approach to innovation does nia Dare use? a. compressed b. flexible options c. experiential d. iterative

5.

nnovation stream begins when a scientific advance or unique combination of existing technologies creates a significant breakthrough in performance or function. Which of the following terms best defines this? a. technological discontinuity b. dominant design c. era of incremental change d. technological substitution

6.

To which of the following is the understanding of how to promote a creative work environment particularly important? a. managing innovation during discontinuous change

8

b. managing innovation during incremental change c. managing information during change d. managing the sources of innovation

9

7.

Which of the following approaches is used to manage innovation in highly uncertain environments during periods of discontinuous change? a. concession b. experiential c. experimental d. compression

8.

Which of the following lists correctly represents both the stages and sequence of the process of organizational decline? a. crisis, faulty action, and dissolution b. inaction, crisis, blinded, faulty action, and dissolution c. blinded, inaction, faulty action, crisis, and dissolution d. inaction, crisis, faulty action, and dissolution

9.

What produces the differences in the form, quality, or condition of an organization over time? a. change forces b. experiential forces c. compression forces d. resistance forces

10. Marcia's group attended a time management seminar. The following day Marcia made certain that the group members incorporated the time management tools in planning their day. Which change process did Marcia employ? a. unfreezing b. refreezing c. implementation d. intervention 11. Leonard shows his staff how they could produce better quality with higher efficiency by changing the order of their manufacturing steps. Which change process did Leonard employ? a. unfreezing b. refreezing

10

c. implementation d. intervention

11

12. Gregory had always used the same process to complete his job functions. When a new process was introduced, Gregory refused to change until his manager threatened to fire Gregory. What did Gregory's manager use to make Gregory adopt the new process? a. accommodation b. collaboration c. intention d. coercion 13. Ken is an engineer. Every 20 minutes he measures final pieces from a production process. The differences from the target measurement allow Ken to make adjustments until the production can process produce perfect pieces. What is this an example of? a. unfreezing change b. process analysis change c. results-driven change d. General Electric change 14. The loss of an important supplier created a crisis at Pierre's company. From Monday to Wednesday, Pierre met with his top managers from across the company to come up with a replacement supplier and a process to not be so reliant on one supplier. What did Pierre employ to resolve this problem? a. General Electric change agent b. General Electric workout c. General Electric intervention d. General Electric boot camp 15. Petra's company has undergone an organizational change. Many employees have new or altered functions and not everyone is adapting to the changes well. Petra appoints David to oversee all of the changes and provide help to employees not coping well with their changes. What role is David fulfilling? a. results agent b. coercion agent c. change agent d. collaboration agent 16. Creativity is a form of organizational innovation. 12

a. True b. False

13

17. The S-curve pattern of innovation is characterized by slow initial progress. a. True b. False 18. One of the ways a dominant design can emerge is through critical mass. a. True b. False 19. The compressed approach to innovation requires the use of milestones. a. True b. False 20. The most common organizational development intervention used for large systems is team building. a. True b. False 21. Technology cycles typically follow a J-curve pattern of innovation. a. True b. False 22. Innovation streams are composed of technology cycles over time. a. True b. False 23. There are five parts to the compression approach to innovation: design iterations, testing, milestones, multifunctional teams, and powerful leaders. a. True b. False 24. One of the most basic ways of determining the effectiveness of change programs is by noting their focus on either activity-oriented change or results-driven change.

14

a. True b. False 25. According to John Kotter's analysis of the errors managers make when leading change, the first and potentially most serious of these errors is lacking a vision. a. True b. False

15

CHAPTER 9 Authority The right to give commands, take action, and make decisions to achieve organizational objectives (p. 146) Autonomy The degree to which a job gives workers the discretion, freedom, and independence to decide how and when to accomplish the job (p. 151) Centralization of authority The location of most authority at the upper levels of the organization (p. 148) Chain of command The vertical line of authority that clarifies who reports to whom throughout the organization (p. 146) Complex matrix A form of matrix departmentalization in which managers in different parts of the matrix report to matrix managers, who help them sort out conflicts and problems (p. 146) Customer departmentalization Organizing work and workers into separate units responsible for particular kinds of customers (p. 143) Decentralization The location of a significant amount of authority in the lower levels of the organization (p. 148) Delegation of authority The assignment of direct authority and responsibility to a subordinate to complete tasks for which the manager is normally responsible (p. 147) Departmentalization Subdividing work and workers into separate organizational units responsible for completing particular tasks (p. 142) Empowering workers Permanently passing decision-making authority and responsibility from managers to workers by giving them the information and resources they need to make and carry out good decisions (p. 155) Empowerment Feelings of intrinsic motivation, in which workers perceive their work to have impact and meaning and perceive themselves to be competent and capable of self-determination (p. 155) 16

Feedback The amount of information the job provides to workers about their work performance (p. 151) Functional departmentalization Organizing work and workers into separate units responsible for particular business functions or areas of expertise (p. 142) Geographic departmental...