Chapter 3
Management 3280 with Biggs at University of North Carolina - Charlotte
About this deck
By: Katherine Weir
Created: 2011-10-04
Size: 57 flashcards
Views: 17
Created: 2011-10-04
Size: 57 flashcards
Views: 17
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What does a SWOT analysis consist of?
A careful listing of a firm's strengths, weaknesses, opportunities, and threats.
Why do managers rely on SWOT?
Top managers rely on SWOT to stimulate self-reflection and group discussions about how to improve their firm and position it for sucess. But it should only be a starting point!
What are some limitations of SWOT?
- Strengths May Not Lead to an Advantage
- SWOT's Focus on teh External Environment is Too Narrow
- SWOT Gives a One-Shot View of a Moving Target
- SWOT Overemphasizes a Single Dimension of Strategy
Explain how "Strenghts may not lead to an advantage".
No matter how unique or impressive the strengths/capabilities may not enable it to achieve a competitive advantage in the marketplace. If a firms builds its strategy on a capability that cannot create or sustain comp adv than it is wasted resour.
Explain how "SWOT's focus on the External Environment is too narrow".
Relying on traditonal definitions of comp env often causes failure to notice important changes on the periphery of their environment that may trigger the need to redefine industry boundaries and identify a who new set of competive relationships.
Explain "SWOT gives a one-shot view of a moving target".
Primarily a static assessment. As circumstances, capabilities, and strategies change, static analysis techniques do not reveal the dynamics of the competitive environment.
Explain "SWOT overemphasizes a single dimension of strategy".
Sometimes firms become preoccupied with a single strength or a key feature of the product or service they are offering and ignore other factors needed for competitive success.
What provides a better analysis and insights into analyzing a firm's competitive position than SWOT analysis does by itself?
Value-Chain Analysis
What is value-chain analysis?
Views the organization as a sequential process of value-creating activites. Useful for understanding the building blocks of competitive advantage.
What are the two different categories of activies described by Porter? What do they include?
Primary: Inbound logistics, operations, outbound logistics, marketing & sales, and service
Support: Procurement, Technology development, HR management, and General admin
What are primary activities?
Sequential activites of the value chain that refer to the physical creation of the product or service, its sale and transfer to the buyer, and its service after the sale.
What are the support activities?
Activities of the value chain that either add value by themselves or add value through important relationships with both primary activities and other support activities.
Explain the primary function of Inbound Logistics.
Primarily associated with receiving, storing, and distributing inputs to the product. It includes material handling, warehousing, inventory control, vehicle scheduling, and returns to suppliers. Example: Toyota's JIT
Explain the primary function of Operations.
Includes all activities associated with transforming inputs into the final product, such as machining, packaging, assembly, testing, printing, and facility operations. Example: Creating envron friendly manufacturing
Explain the primary function Outbound Logistics.
Assocated with collecting, storing, and distributing the product or service to buyers. Activities include finished goods, warehousing, material handling, delviery vehicle operation, order processing, and scheduling. Exp: Campbells continous repl
Explain the primary function Marketing and Sales.
Associated with the purchase of products and services by end users and the inducements used to get them to make purchases. Includes advertising, promotion, sales force, quoting, channel selection, channel relations, and pricing. Ex: Monsato Windows
Explain the primary function of Service.
Includes all actions assocated with providing service to enhance or maintain the product, such as installation, repair, training, parts supply, and product adjustment. Ex: cyber-assist at Nordstrom
Explain the support activity of Procurement.
Refers to the fuc. of purchasing inputs used in the VC, not to the purchased inputs themselves. Purch. inputs include raw mat., supplies, and other consumable items as well as assets such as machinery, lab equip, & bldgs. Ex: review of suppliers
Explain the support activity of Technology Development.
Every value activity embodies technlology. Tech Dev related to the product and its features supports teh entire value chain, while other tech dev is associated with particular primary or support activites
Explain the support function of Human Resource Management.
Consists of activities involved in the recruiting, hiring, training, development, and compensation of all types of personnel. Supports both primary and support actvities and the entire value chain.
Explain the support function of General Administration.
Consists of # of activites including general mgmt, planning, finance, accounting, legal and government affairs, quality mgmt, and info systems. Admin (unlike other support act) typically support the entire value chain and not individual activites.
There is an important relationship among value-chain activites. What are the two levels?
- Interrelationships among activites w/i the firms and
- relationship among activities within the firm and with other organizations that are part of the firm's expanded value chain
Define the term Interrelationships.
Collaborative and strategic exch relationships between value-chain activities either w/i or b/w firms. Strategic exchange relationships involve exchange of resources such as info, people, tech or $ that contribute to the success of the firm.
How can the value-chain by applied to service organizations?
The concept of in log, oper, and out log corresponds to any trans process in which inp -> outputs that add value. Process may be configured diff depending on type of bus. Ex: Retail=part w/ vend, purch goods, mg dist inv, oper stores, mkt/sales
What are some factors to consider in assessing a firm's Inbound Logistics?
- Locat of distr facilities to min ship times
- Warehouse layout/designs to inc efficiency of oper for inc mat
- Exc mat & inv contr systems
- Systems to reduce time to send "returns" to suppliers
What are some factors to consider in assessing a firm's operations activites?
- Efficient plant oper to min costs
- Approp level of automation in manuf
- Quality prod control systems to reduc costs & enhance quality
- Efficient plant layout and workflow design
What are some factors to consider in assessing a firm's oubound logistics?
- Effective ship proc to prov quick del and min damages
- Efficient fin goods warehousing processes
- Shipping goods in large lot sizes to min tran costs
- Quality mat handling equip to increase order picking
What are some factors to consider in assessing a firm's marketing & sales activities?
- Highly motivated & competent sales force
- Innovative approaches to promotion and advertising
- Selection of most appropriate distribution channels
- Proper identification of customer segments and needs
- Effective pricing strategies
What are some factors to consider in assessing a firm's service activities?
- Effec use of proc to solicit/act oncust feedback
- Quick res to cust needs & emerg
- Ability to furnish rplc parts as required
- Effect mgmt of parts & equip invt
- Q of serv pers and ongoing training
- Approp warranty & guarantee policies
What is the Resource-based view of the firm (RBV)?
Perspective that the firms' competitive advantages are due to their endowment of strategic resources that are valuable, rare, costly to imitate, and costly to substitute.
What two perspectives does RBV combine?
- The internal analysis of phenomena within a company
- An external analysis of the industry and its competitive environment
How is RBC helpful?
Helpful in developing strategies for individual businesses and diversified firms by revealing how core competencies embedded in a firm can help it exploit new product and market opportunities.
What is the "central theme" of the resource-based view of the firm?
Competitive advantages are created (and sustained) through the bundling of several resources in unique combinations.
What are the three main types of resources?
- Tangilbe
- Intangible
- Organizational Capabilities
What are tangible resources?
Organizational assets that are relatively easy to identify, including physical assets, financial resources, organizational resources, and technological resources.
Give examples of Financial & Physical Resources.
- Financial: Firm's cash account and cash equivalents, Firm's capacity to raise equity, Firm's borrowing capactity
- Physical: Modern plant and facilities, Favorable manufacturing locations, State-of-the-art machinery and equipment
Give examples of Technoligical & Organizational Resources.
- Technological: Trade secrets, Innovative production processes, Patents/Copyrights/Trademarks
- Organizational: Effective, strategic planning process, Excellent evaluation adn control systems
What are intangible resources?
Organizational assets that are difficult to identify and account for and are typically embedded in unique routies and practices, including human resources, innovation resources, and reputation resources. (A firm's culture may also be a resource)
Give examples of three different kinds of intangible resources.
- Hmn: Expe & Capab of employ, Trust, Managerial skills, Firm-specific pract and proced
- Innov & Creativitiy: Tech & scien skills, Innov capacities
- Rep: Bnd name, Rep w/ cust 4 q & r, Rep w/ supplier for fairness, non-zero-sum relat.
What are Organizational Capabilites?
The competencies and skills that a firm employes to transform inputs into outputs. Refers to an organ's capacity to deploy tangible and intangible resources over time & generally in combo, and to lev those capab to bring about desired end.
What are some examples of organizaitonal capabilities?
- outstanding customer service
- excellent product development capabilities
- superb innovation processes
- flexibility in manufacturing processes
- ablity to hire, motivate, and retain human capital
Whatt four attributes must a resource posses in order to provide a firm w/ the potential for a sustainable competive advantage?
- must be valuable in the sense that it exploits opps and/or neutralizes threats in the fimr's env.
- rare among the firm's current & potential competitors
- difficult to imitate
- Must have no strategically equivalent subs (difficult to sub)
Managers can forestall imitability by having at least one of what four characteristics?
- Physical Uniqueness
- Path Dependency
- Casual Ambiguity
- Social Complexity
Explain Physical Uniqueness.
Difficult to copy. Includes things like resort locations, mineral rights, or patents.
Explain the term path dependency.
Characteristic of resources that is developed and/or accumlated through a unique series of events. Ex: crash R&D program b/c research findings accumulate, Gerber brand loyalty
Explain the term casual ambiguity.
Impossible to disentangle the causes (or poss explacan be recreated. Often ogan capabilites involving a complex web of soc inter that depend on indiv Ex: SW culture of fun, family, frugality , and focus.
Explain the term social complexity.
Costly to imitate b/c the social engineering req is beyond the capability of comp including interpersonal relat among mgrs, org cult, and reputation w/ supplers and cust
Substitutability may take what two forms?
- May be able to sub a similar resource that enable it to develop and implement same strategy Ex: high-quality mgmt team
- Very different firm resources can become strategic subs. Ex: amazon vs brick and mortar
What is the implication if resource or capability does not meet any of the four criterias? Only Valuable criteria? Valuable and Rare only? All?
- Competitive disadvantage
- Competitive parity
- Temp competitive advantage
- Sustainable comp advantage
What 4 factors help explain the extent to which employees and mgrs will be able to obtain a proportionately high level of the profits they generate?
- Emp bargaining power: take clients w/ them
- Emp replacement cost: skills are idiosyncratic & rare
- Emp exit costs: red pwr b/c high pers cost of leaving or causal ambiguity
- Mgr bargaining power: integrated understanding of total oper
When are such diversion of profits from the owners of the business to top mgmt is far less likely?
When board members are truly independent outsiders.
What are two approaches to use when evaluating a firm's performance?
- Financial ratio analysis
- Broader stakeholder view
Define financial ratio analysis.
Technique for measuring the perfromance of a firm according to its balance sheet, income statement, and market valuation.
What are the five different types of financial ratios?
- Short-term solvency or liquitdy
- Long-term solvency measures
- Asset management (or turnover)
- Profitablility
- Market value
Important reference points are needed. What are some issues that must be taken into account to make financial analysis more meaningful?
- historical comparisons
- comparisons w/ industry norms
- comparisons w/ key competitors
What is a balanced scorecard?
Method for evaluating a firm;'s performance using performance measures from the customers', internal, innovation and learning, and financial perspectives.
What is a major limitation of the balance scorecard?
- Lack of clear strategy
- Limited or ineffective exec sponsorship
- too much emphasis on fin measures rather than nonfinancial measures
- poor data on actual perf
- inapp links of scorecard measures to compensation
- inconsistent or inapp terminology
About this deck
By: Katherine Weir
Created: 2011-10-04
Size: 57 flashcards
Views: 17
Created: 2011-10-04
Size: 57 flashcards
Views: 17
About StudyBlue
STUDYBLUE makes things that make you better at school.
Things like online flashcards with photos and audio.
Things like personalized quizzes and friendly reminders about when (and what) to study next.
Think of it as a digital backpack™: access to all of your study materials online and on your phone.
STUDYBLUE exists to make studying efficient and effective for every student, for free. Join us.
“Simply amazing. The flash cards are smooth, there are many different types of studying tools, and there is a great search engine. I praise you on the awesomeness.”
Dennis
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