question

planning

answer

involves setting goals and deciding how to achieve them

question

why plan?

answer

helps you check your progress, helps you coordinate activities, helps you be forward-thinking, helps you deal with uncertainty

question

2 drawbacks to planing

answer

1. time consuming 2. plans go obsolete quickly

question

developed the 4 organizational responses to uncertainty

answer

Raymond E. Miles and Charles C. Snow

question

4 approaches to responding to environmental uncertainty

answer

defenders, prospectors, analyzers, and reactors

question

Defenders

answer

experts at producing and selling narrowly defined products and services; strive to defend dominance in their market segments, penetrating deeper into current markets; cautious and incremental growth; ignore developments outside of their narrow market segment

question

when does defender strategy work

answer

organization operates in relatively steady environment and a mature industry

question

prospectors

answer

focus on developing new products/services and seeking out new markets; frequently experiment with new products/approaches; initiate change; first to introduce new products; spurt like growth

question

when does prospector strategy work

answer

organization is operating in an environment that is unstable and rapidly changing; changing technology and customer needs

question

analyzers

answer

let other organizations take the risks of product development and marketing and then imitate what seems to work best; typically operates in both a cash cow domain and an ever-changing domain they hope will propel growth; monitor environment for opportunities and new ideas that might lead to growth; growth is normally through market penetration

question

when analyzer strategy works

answer

organization operates in a mature but growing market in which technology and customer preferences are ever-changing

question

reactors

answer

adjustments only made when forced to do so by environmental pressures; inability to respond usually drives down sales and forces them out of business

question

when reactor strategy works

answer

organization operates in a market that is either highly regulated or has no competition

question

3 types of business problems of the adaptive cycle

answer

entrepreneurial (what markets should we be in?), engineering (how are we going to produce/deliver our product? how will we reach the markets we want to be in?), administrative (what are the rules and procedures we must follow to be successful?)

question

steps in planning process

answer

1. mission statement 2. vision statement 3. strategic planning 4. tactical planning 5. operational planning

question

mission statement

answer

expresses the organization's purpose or reason for being; says something about the organization's purpose, business, and values

question

vision statement

answer

expresses where the organization wants to go, what it wants to become, what it wants to accomplish, and why the vision is important

question

goals

answer

specific commitments to achieve a measurable result within a stated period of time

question

means-end chain

answer

hierarchy of organizational goals and constitutes the means that lead to the accomplishment of the ends

question

strategic goals

answer

set by and for top management and focus on objectives for the organization as a whole

question

tactical goals

answer

set by and for middle managers and focus on the actions needed to achieve strategic goals

question

operational goals

answer

set by and for first line managers and are concerned with short term associated with realizing tactical goals

question

strategic planning

answer

1-5 years; top managers decide on long-term goals with the resources they expect to have available

question

tactical planning

answer

middle managers determine what contributions their departments can make with their given resources over the next 6 to 24 months

question

operational planning

answer

first line managers determine how to accomplish specific tasks with available resources over the next 1-52 weeks

question

action plan

answer

defines the course of action needed to achieve the stated goal

question

operating plan

answer

defines how the business will be conducted over a one year period and identifies clear targets such as revenues, cash flow, and market share

question

standing plans

answer

developed for activities that occur repeatedly over a period of time (policy, procedure, rule)

question

policy

answer

standing plan that outlines the general response to a designated problem or situation

question

procedure

answer

standing plan that outlines the response to a particular problem or circumstance

question

rule

answer

standing plan that designates strategic required action

question

single use plans

answer

developed for activities that are not likely to be repeated in the future (projects and programs)

question

program

answer

single use plan encompassing a range of projects or activities

question

projects

answer

single use plan encompassing a smaller range of tasks or activities

question

management by objectives (MBO)

answer

4 step process with the purpose of motivating subordinates to achieve organizational goals

question

4 steps of MBO

answer

1. set objectives jointly 2. develop an action plan 3. review performance periodically 4. appraise performance and give rewards

question

3 things that need to be in place for MBO to be a success

answer

commitment of top management, organizational wide commitment, cascading objectives

question

cascading objectives

answer

structuring objectives in a unified hierarchy, becoming more specific at the lowest levels

question

advantages of MBO

answer

joint participation, employees more committed, focuses on steps need to be taken to achieve organizational goals

question

disadvantages of MBO

answer

time consuming, managers have more negotiating power

question

SMART goals

answer

specific, measurable, appropriate, realistic, time bound

question

planning and control cycle

answer

1. make the plan 2. carry it out 3. control direction by comparing results with the plan 4. control the direction by taking corrective action

question

benefits of planning

answer

employees motivated by clear goals, planning helps managers allocate scarce resources, provide a standard of performance

question

limitations of planning

answer

false sense of risklessness, can reduce an organization's flexibility, inhibit intuition and creativity

question

strategic management

answer

process that involves managers from all parts of the organization in the formulation and implementation of strategies and strategic goals

question

why strategy matters

answer

provides direction and momentum, encourages new ideas, help an organization develop a sustainable competitive advantage

question

Porter's 3 underlying principles of strategic planning

answer

1. strategy involves creating a unique and valuable position 2. strategy involves competitive trade-offs 3. strategy requires the creation of a fit among activities

question

variety based positioning

answer

produces a subset of an industry's products or services (ex: Jiffy Lube)

question

needs based positioning

answer

attempts to serve most or all of the needs of a particular group of customers (ex: IKEA)

question

2 approaches to needs based positioning

answer

serving the broad needs of a few customers, serving the differing needs of similar customers

question

access based positioning

answer

segments customers who are accessible in different ways rather than on actual differences between them (ex: Carmike Cinemas)

question

5 steps of strategic management process

answer

1. determine a mission and vision 2. determine the grand strategy 3. generate strategic plans 4. execute the strategic plans 5. maintain control over the strategy

question

3 common grand strategies

answer

growth, stability, defensive

question

grand strategy

answer

explains how the organization will accomplish its mission

question

growth strategy

answer

involves expansion as in sales revenue, market shares, number of employees, or number of customers served

question

stability strategy

answer

involves little or no significant change; firm still faces stiff competition or a changing environment

question

defensive strategy

answer

involves reduction of the organization's efforts

question

competitive intelligence

answer

gaining information about competitors' activities so that one can anticipate their moves and act appropriately

question

SWOT analysis

answer

strategic planning tool that involves the search for the strengths, weaknesses, opportunities, and threats

question

organizational strengths

answer

skills and capabilities that give the organization special competencies and competitive advantages

question

organizational weaknesses

answer

drawbacks that hinder an organization in executing strategies

question

organizational opportunities

answer

environmental factors that the organization can exploit for competitive advantage

question

organizational threats

answer

environmental factors that hinder an organization's achievement of a competitive advantage

question

why is SWOT analysis useful

answer

helps managers set realistic goals, improve their capabilities, and establish plans to overcome weaknesses, exploit strengths, and turn threats into opportunities

question

2 kinds of forecasting

answer

trend analysis, contingency planning

question

trend analysis

answer

hypothetical extension of a past series of events into the future

question

contingency planning

answer

creation of alternative hypothetical but equally likely future conditions

question

Porter's 5 forces of competition

answer

1. threat of new entry 2. suppliers' bargaining power 3. buyers' bargaining power 4. threat of substitute products 5. competitive rivalry

question

threat of new entry

answer

new competitors take customers away from existing organizations; higher the barriers, the more costly entry, less competition

question

suppliers' bargaining power

answer

more concentrated the industry, the more bargaining power of suppliers

question

buyers' bargaining power

answer

buyers have more bargaining power when there is a relatively small number of buyers

question

threats of substitute products

answer

a firm faces more competition when there are more available substitutes for its products and services

question

competitive rivalry

answer

more competition, less profitable; can be mitigated by differentiation

question

Porter's 4 competitive strategies

answer

cost-leadership, differentiation, cost-focus, focused-differentiation

question

cost-leadership strategy

answer

used to keep costs/prices low to target a wide market, focus on efficiency of their processes in order to achieve this strategy; ex: WalMart

question

differentiation strategy

answer

used to offer products or services that are of unique and superior value to target a wide market; ex: Apple and Target

question

cost-focus strategy

answer

keep costs/prices low to target a narrow market; ex: Dollar Store

question

focused-differentiation strategy

answer

used to offer products or services that are of unique and superior value to target a narrow market ex: IKEA

question

single product strategy

answer

company makes and sells only one product within its market; allows organization to focus its efforts on one product

question

diversification strategy

answer

company operates several businesses to spread out the risk, 2 types

question

unrelated diversification

answer

when an organization operates several unrelated businesses under one ownership; ex: Berkshire Hathaway

question

related diversification

answer

when an organization operates several separate but related businesses ex: Disney

question

factors that may influence a decision to use related diversification

answer

resource allocation, strategy formulation, performance control and management

question

BCG matrix

answer

evaluates business units based on growth rate and market share

question

stars

answer

high growth industry and have high market share; can become cash cows

question

cash cows

answer

slow growth but high market share; finance stars and question marks

question

question marks

answer

new ventures with a high market growth but low market share

question

dogs

answer

low growth and low market share; should be sold or gotten rid of

question

strategy implementation

answer

putting strategic plans into effect

question

execution

answer

consists of using questioning, analysis, and follow-through to mesh strategy with reality, align people with goals, and achieve promised results

question

3 core processes of business

answer

people, strategy, operations

question

8 components for implementation

answer

1. exercising strategic leadership to drive implementation 2. shaping the work environment/culture to fit the strategy 3. using rewards and incentives appropriately 4. allocating enough resources to key activities 5. establishing policies that support strategies 6. pushing for continuous improvement 7. building an org that can successfully execute a strategy 8. installing information and operating systems to enable personnel to be more efficient

question

tools for turning strategy into action

answer

visible leadership, clear roles and accountability, candid communication, appropriate human resources practices

question

strategic control

answer

monitoring the execution of strategy and making adjustments if necessary

question

2 ways of making decisions

answer

rational and emotional

question

rational (classical) model

answer

assumes that managers are logical decision makers who strive to make the optimal decision and always act in the organization's best interest

question

non rational model

answer

assumes that risky or uncertain environment; managers find it difficult to make optimal decisions

question

4 steps of rational decision making model

answer

1. identify the problem or opportunity 2. generate alternatives 3. evaluate alternatives and pick one 4. implement the solution and evaluate it

question

3 faulty assumptions of rational model

answer

1. managers have complete information 2. managers can separate emotions from their analysis 3. managers can make the best decision for the organization

question

3 major nonrational decision making models

answer

incremental, satisficing, intuition

question

incremental model

answer

managers take small, short term steps to alleviate a problem instead of taking one gigantic step towards a long term solution

question

satisficing model

answer

managers seek alternatives until they find one that is satisfactory; proposed by Herbert Simon

question

bounded rationality

answer

ability of decision makers to be rational is limited by numerous constraints

question

judgmental heuristics

answer

shortcuts or rules of thumb

question

intuition model

answer

making a choice without the use of conscious thought or logical inference; complement to rational decision making

question

evidence based management

answer

requires managers to establish organizational practices based on hard data and best evidence

question

Pfeffer and Sutton's 7 principles to help companies implement evidence based management

answer

1. act as if org is an unfinished prototype 2. don't brag or embellish 3. look at org as if you were an outsider 4. make everyone participate in evidence based management 5. sell evidence based management 6. avoid or ignore orders that are wrong 7. allow failure but try to learn from it

question

4 decision making styles

answer

directive, conceptual, analytical, behavioral

question

directive style

answer

efficient, practical, systematic, logical, action-oriented, decisive; prefers clear cut solutions, concerned about the short run, exercises power and control

question

analytical style

answer

carefully considers a lot of information and alternatives, takes longer to make a decision, responds well to new situations

question

conceptual style

answer

broad perspective, considers many options, focuses on long term, takes risks, comes up with creative solutions, enjoys new ideas, relies on intuition and discussions with others, tends to be indecisive

question

behavioral style

answer

people-oriented and works well with others, avoids conflicts, shows concern for others, receptive to suggestions, tends to be wishy washy

question

4 ineffective reactions to decision maling

answer

relaxed avoidance, relaxed change, defensive avoidance, panic

question

relaxed avoidance

answer

manager decides to take no action in the belief that there will be no great negative consequences

question

relaxed change

answer

manager realizes that complete inaction will have negative consequences and opts for the first available alternative that involves low risk

question

defensive avoidance

answer

manger can't find good solution and procrastinates or denies the risk of negative consequences

question

panic

answer

manger frantically tries to get rid of a problem and can't deal with the situation realistically

question

3 types of organizations

answer

for profit, nonprofit, mutual benefit

question

2 challenges in organizing role

answer

designing organizational structure, designing organizational culture

question

3 elements of organizational architecture

answer

structure, culture, and human resource management systems

question

4 types of organizational culture

answer

clan, adhocracy, market, hierarchy

question

clan culture

answer

internal focus and values flexibility rather than stability and control, values cohesion, consensus, job satisfaction, collaboration

question

adhocracy culture

answer

external focus and values flexibility, values adaptivity, creativity, and flexibility; innovative companies and start ups

question

market culture

answer

external focus, driven by competition, values stability and control; profits, productivity, and results are more important

question

hierarchy culture

answer

internal focus, values stability and control, control mechanisms in place to ensure promptness, efficiency, and effectiveness

question

3 layers of organizational culture

answer

observable artifacts, espoused values, basic assumptions

question

how culture is learned

answer

stories, rituals, material symbols, language

question

importance of organizational culture

answer

provide organizational identity, facilitate collective commitment, promote social system stability, shape behavior

question

3 perspectives for enhancing economic performance

answer

strength, fit, adaptive

question

strength perspective

answer

strength of a corporate culture is related to a firm's long term financial performance

question

fit perspective

answer

assumes that an organization's culture must align with its business or strategic context

question

adaptive perspective

answer

assumes that the most effective cultures help organizations anticipate and adapt to environment changes

question

process of culture change

answer

formal statements, slogans and sayings, stories, legends, and myths, leader reactions to crisis, role modeling, training, and coaching, physical design, rewards, titles, promotions, and bonuses, organizational goals and performance criteria, measurable and controllable activities, organizational structure, procedures for self development

question

7 common elements of all organizations

answer

1. common purpose 2. coordinated effort 3. division of labor 4. hierarchy of authority 5. span of control 6. authority 7. centralization of authority

question

4 traditional designs

answer

simple, functional, divisional, matrix structures

question

simple structure

answer

centralized authority, flat hierarchy, few rules, low work specialization

question

functional structure

answer

people with similar specialties are put together in formal groups

question

divisional structure

answer

people with diverse specialties are put together in formal groups by similar products or services, customers or clients, or geographic regions

question

matrix structure

answer

combines functional and divisional chains of command so that employees have 2 bosses (functional and project managers)

question

horizontal design

answer

use of temporary or permanent teams to break down internal boundaries and improve collaboration

question

3 types of boundaryless organization

answer

hollow, modular, and virtual structures

question

hollow structures

answer

central core of an organization is complemented by outside, independent firms that provide outsourced goods/services and are linked to the central core via computers

question

modular structure

answer

firm assembles product chunks/modules provided by outside contractors

question

virtual structure

answer

firm creates a company outside a company specifically to respond to an attractive market opportunity

question

contingency design

answer

process of fitting the organization to its environment

question

mechanistic organization

answer

authority is centralized, tasks and rules are clearly specified and employees are closely supervised; top down communication and rigid rules

question

organic organization

answer

decentralized authority, less rules and procedures, networks are encouraged to cooperate and respond quickly

question

differentiation

answer

tendency of the parts of an organization to disperse and fragment

question

integration

answer

tendency of the parts of an organization to draw together to achieve a common purpose

question

7 steps of SHRM

answer

1. determine the mission and vision 2. determine the grand strategy 3. come up with strategic plans 4. determine what human resources are needed 5. recruit and select individuals 6. engage in orientation, training, and development 7. appraise employee performance

question

constraints of HRM environment

answer

legislation, societal trends, changing technology

question

tools of SHRM

answer

human capital, knowledge workers, social capital

question

human capital

answer

economic or productive potential of employee knowledge, experience and actions

question

knowledge workers

answer

people whose work involves generating or interpreting information rather than manual labor

question

social capital

answer

economic or productive potential of strong, trusting, and cooperative relationships

question

job analysis

answer

determines the basic elements of a job

question

job description

answer

what a holder of a job does and how/why they do it

question

job specification

answer

minimum qualifications a person must have to perform a job successfully

question

3 areas EEOC laws cover

answer

discrimination, sexual harassment, affirmative action

question

National Labor Relations Board

answer

created by Wagner Act, enforces procedures whereby employees may vote to have a union and engage in collective bargaining

question

collective bargaining

answer

negotiations between management and employees about disputes over compensation, benefits, working conditions, and job security

question

Fair Labor Standards Act of 1938

answer

banned child labor and established minimum living standards for workers engaged in interstate commerce

question

Title 9 of CRA of 1964

answer

prohibits discrimination based on race, color, sex, religion, or national origin

question

Civil Rights Act of 1991

answer

strengthens CRA of 1964 by increasing damages and shifting the burden of proof to employer

question

ADA of 1990

answer

prohibits discrimination based on disability and requires employers to make reasonable accommodations

question

vocational rehabilitation act of 1973

answer

prohibits discrimination based on mental or physical disability

question

health insurance portability accountability act of 1996 (HIPPA)

answer

prohibits group plans from dropping sick employees and allows workers to get new coverage when they change jobs

question

family and medical leave act of 1993

answer

requires companies to provide up to 12 weeks of unpaid leave for adoption, family emergencies, or childbirth

question

equal pay act of 1963

answer

prohibits employers from paying males and females differently for equal work

question

patient protection and affordable care act of 2010

answer

requires firms with 50+ employees to provide health care

question

consolidated omnibus budget reconciliation act of 1985 (COBRA)

answer

allows employees to retain their health insurance coverage for a period of time after being laid off

question

OSHA

answer

sets mandatory health and safety standards to which organizations must adhere

question

recruitment

answer

process of locating and attracting qualified applicants for positions in the organization

question

internal recruiting

answer

cheaper, boots morale and productivity, restricts competition from outsiders, may lead to promotions based on seniority over merit, doesn't fill vacancy

question

external recruiting

answer

workers with fresh viewpoints, can be expensive and time consuming and risky

question

realistic job preview

answer

gives a candidate a picture of both positive and negative features of the job and the organization before they are hired

question

3 kinds of selection tools

answer

background information, interviewing, and employment tests

question

unstructured interviews

answer

asking probing questions to find out what the applicant is like, highly subjective

question

structured interviews

answer

involve asking each applicant the same questions and comparing their responses to a standardized set of answers

question

situational interviews

answer

interviewer uses hypothetical situations to test the candidate's ability to do the job

question

behavioral description interviews

answer

involve an exploration into what applicants have actually done in the past

question

3 types of employment tests

answer

ability, performance, personality tests

question

2 legal considerations for employment tests

answer

reliability and validity

question

orientation

answer

process of helping a newcomer fit smoothly into the job and organization, includes job routine, mission and operations, work rules and employee benefits

question

training

answer

educating technical and operational employees in how to better do their current jobs

question

development

answer

refers to educating professionals and managers in the skills they need to do their jobs in the future

question

objective appraisals

answer

based on facts and often numerical, independent of personal biases

question

subjective appraisals

answer

based on a manager's perceptions of an employee's traits or behaviors

question

BARS

answer

rates employee performance according to scales of specific behaviors

question

360 degree assessment

answer

performance appraisal when employees are appraised by supervisors, peers, subordinates, and clients

question

forced ranking

answer

ranking all employees in a business unit against one another

question

formal appraisal

answer

conducted at specific times throughout the year and are based on performance measures that have been established in advance

question

informal appraisal

answer

conducted on an unscheduled basis and less rigorous

question

forms of compensation

answer

wages/salaries, incentives, benefits

question

what to use to manage an effective workforce

answer

promotion, transfer, discipline, demotion, dismissal

question

Collins' 5 stages of institutional decline

answer

1. hubris born of success 2. undisciplined pursuit of more 3. denial of risk and peril 4. grasping for salvation 5. capitulation to irrelevance or death

question

trends in organizational change

answer

segmentation and niche products, targeted products with shorter time to market, radical innovation is hurting traditional companies, the effect of china and india, knowledge as a competitive advantage

question

reactive change

answer

making changes in response to problems or opportunities as they arise

question

proactive change

answer

carefully thought out changes made in anticipation of possible or expected problems or opportunities

question

forces of change

answer

demographic changes, changes in the market, technological advancements, shareholder and customer demands, supplier practices, social and political pressures, problems with employees, behavior of managers

question

common areas where change is needed

answer

people, technology, structure, strategy

question

3 causes of resistance to change

answer

employee characteristics, change agent characteristics, change agent employee relationship

question

adaptive change

answer

reintroduction of a familiar practice

question

innovative change

answer

introduction of a practice that is new to the organization

question

radically innovative change

answer

introduction of a practice that is new to the industry

question

lewin's change model

answer

unfreezing, changing, refreezing

question

Kotter's 8 steps for organizational change

answer

1. create sense of urgency 2. create a guiding coalition 3. develop a vision and strategy 4. communicate the change vision 5. empower broad based action 6. generate short term wins 7. consolidate gains and produce more change 8. anchor new approaches in the culture

question

4 steps of organizational development

answer

1. diagnosis 2. intervention 3. evaluation 4. feedback

question

organizational development most successful when

answer

multiple interventions, supported by top managers, both short term and long term results, culture is conducive

question

innovation

answer

process of coming up with new ideas and turning them into useful applications

question

product innovation

answer

change in the appearance or performance of a product or service, or the creation of a new one

question

process innovation

answer

change in the way a product/service is conceived, manufacture, or disseminated

question

incremental innovation

answer

creation of a product, service, or technology that modifies an existing one

question

radical innovation

answer

creation of a product, service, or technology that replaces existing ones

question

ways organizations encourage innovation

answer

1. create a culture that celebrates failure 2. devote the right amount of money, time, energy and focus to innovation 3. reward top performing innovators

question

ways managers can foster innovation

answer

1. recognize problems and opportunities 2. communicate your vision 3. overcome resistance from employees by empowering and rewarding them 4. execute well

question

environmental scanning

answer

practice of carefully monitoring an organization's internal and external environments to detect signs of opportunities and threats that may influence the firm's plans

question

3 advantages of diversification strategy

answer

1. reduces risk that entire organization will fail 2. spread administrative costs over a number of businesses 3. helps an organization achieve synergy

question

analytics

answer

sophisticated forms of business data analysis that represent the purest form of evidence based management; portfolio analysis and time-series forecasting

question

predictive modeling

answer

data mining technique used to predict future behavior and anticipate the consequences of change

question

data analytics

answer

process of analyzing "big data" for practical purposes, such as managing electricity grids of traffic patterns

question

availability bias

answer

when managers use information that is readily available from memory to make judgments

question

representative bias

answer

tendency to generalize from a small sample or a single event

question

confirmation bias

answer

when a person seeks information that supports his or her point of view and discounts data that do not

question

sunk cost bias

answer

when managers add up all the money already spent on a project and conclude that it would be too costly to simply abandon it

question

anchoring adjustment bias

answer

tendency to make decisions based on an initial figure

question

overconfidence bias

answer

when people have more subjective confidence in their decision making than their objective accuracy

question

hindsight bias

answer

when people tend to view past events as more predictable than they really were

question

framing bias

answer

when decision makers are unduly influenced by the way a problem or situation is presented

question

escalation of commitment bias

answer

when a decision maker increases their commitment to a project despite negative information about it

question

espoused values

answer

the explicitly stated values and norms preferred by an organization

question

enacted values

answer

values and norms actually exhibited by the organization

question

unity of command

answer

an employee should report to no more than one manager so that conflicting priorities and demands can be avoided

question

adverse impact

answer

when an employment practice or procedure negatively impacts a protected class of individuals

question

disparate treamtment

answer

occurs when organizations intentionally treat individuals from protected groups differently

question

computer assisted instruction (CAI)

answer

computers are used to provide additional help or to reduce instructional time

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