Management (Griffin) – Chapter 8

strategy
A comprehensive plan for accomplishing an organization’s goals
strategic management
A comprehensive and ongoing management process aimed at formulating and implementing effective strategies; a way of approaching business opportunities and challenges
effective strategy
A strategy that promotes a superior alignment between the organization and its environment, and the achievement of strategic goals
distinctive competence
An organizational strength possessed by only a small number of competing firms
scope
When applied to strategy, it specifies the range of markets in which an organization will compete
resource deployment
How an organization distributes its resources across the areas in which it competes
business-level strategy
The set of strategic alternatives from which an organization chooses as it conducts business in a particular industry or market
corporate-level strategy
The set of strategic alternatives from which an organization chooses as it manages its operations simultaneously across several industries and several markets
strategy formulation
The set of processes involved in creating and determining the strategies of the organization; it focuses on the content of the strategies
strategy implementation
The methods by which strategies are operationalized or executed within the organization; it focuses on the processes through which strategies are achieved
deliberate strategy
A plan of action that an organization chooses and implements to implement specific goals
emergent strategy
A pattern of action that develops over time in an organization in the absence of mission and goals, or despite mission and goals
SWOT
An acronym that stands for strengths, weaknesses, opportunities, and threats
organizational strength
A skill or capability that enables an organization to conceive of and implement its strategies
common strength
A skill or capability held by numerous competing firms
strategic imitation
The practice of duplicating another organization’s distinctive competency, and thereby implementing a valuable strategy
sustained competitive advantage
A competitive advantage that exists after all attempts at strategic imitation have ceased
organizational weakness
A skill or capability that does not enable an organization to choose and implement strategies that support its mission
competitive disadvantage
A situation in which an organization is not implementing valuable strategies that are being implemented by competing organizations
organizational opportunity
An area in the environment that, if exploited, may generate higher performance
organizational threat
An area in the environment that increases the difficulty of an organization’s achieving high performance
differentiation strategy
A strategy in which an organization seeks to distinguish itself from competitors through the quality of its products or services
overall cost leadership strategy
A strategy in which an organization attempts to gain a competitive advantage by reducing its costs below the costs of competing firms
focus strategy
A strategy in which an organization concentrates on a specific regional market, product line, or group of buyers
prospector strategy
A strategy in which the firm encourages creativity and flexibility, and is often decentralized
defender strategy
A strategy in which the firm focuses on lowering costs and improving the performance of current products to hold on to market share
analyzer strategy
A strategy in which the firm attempts to maintain its current businesses AND to be somewhat innovative in new businesses (so lies midway between prospector & defender strategies)
reactor strategy
A strategy in which a firm has no consistent approach to strategy
product life cycle
A model that portrays how sales volume for products changes over the life of the products
diversification
The number of different businesses that an organization is engaged in and the extent to which these businesses are related to one another.
single-product strategy
A strategy in which an organization manufactures just one product or service, and sells it in a single geographic market
related diversification
A strategy in which an organization operates in several businesses that are somehow linked with one another
unrelated diversification
A strategy in which an organization operates multiple businesses that are not logically associated with one another
backward vertical integration
An organization’s beginning the business activities formerly conducted by its suppliers
forward vertical integration
An organization’s beginning the business activities formerly conducted by its customers
merger
The purchase of one firm by another firm of approximately the same size
acquisition
The purchase of a firm by a firm that is considerably larger
portfolio management technique
A method of determining which businesses to engage in, and how to manage these businesses to maximize corporate performance
BCG matrix
A method of evaluating businesses relative to the growth rate of their market and the organization’s share of the market (divided into STARS, QUESTION MARKS, CASH COWS, AND DOGS)
GE Business Screen
A method of evaluating businesses along two dimensions (1) industry attractiveness and (2) competitive position; in general, the more attractive the industry and the more competitive the position, the more an organization should invest in the business
industry attractiveness
Based on market growth, market size, capital requirements, and competitive intensity
competitive position
Based on market share, technological know-how required, relative quality of company’s products; service network; price competitiveness, and operating costs
home replication strategy
International strategy in which a company uses the core competency or firm-specific advantage it developed at home as its main competitive advantage in the foreign markets that it enters
multidomestic strategy
International strategy in which a company manages itself as a collection of relatively independent operating subsidiaries, each of which focuses on a specific domestic market
global strategy
International strategy in which a company views the world as a single marketplace, and has as its primary goal the creation of standardized goods and services that will address the needs of customers worldwide
transnational strategy
International strategy in which a company attempts to combine the benefits of global-scale efficiencies with the benefits and advantages of local responsiveness
CORPORATE-level strategies
(1) Single-product strategy
(2) Related diversification
(3) Unrelated diversification