MGT247 Exam-Questions With Correct Answers/ 100% pass/ Expert Verified
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Course
MGT247
Institution
MGT247
What is Strategic management? - process to formulate and implement a strategy.
What is a strategy? - A set of goal directed actions a firm takes to gain and sustain a
competitve advantage.
Elements of a good strategy (Analysis) - diagnosis of the competitive advantage
Elements of a good strateg...
MGT247 Exam -Questions With Correct Answers/ 100% pass / Expert Verified What is Strategic management? - ✔✔process to formulate and implement a strategy. What is a strategy? - ✔✔A set of goal directed actions a firm takes to gain and sustain a com petitve advantage. Elements of a good strategy (Analysis) - ✔✔diagnosis of the competitive advantage Elements of a good strategy (Formulation) - ✔✔guiding policy to adress competitive advantage Elements of a good strategy (Implementation) - ✔✔a set of coherent actions to implement the firm's guiding policy What is competitive advantage? - ✔✔having better performance than other competitors in the same industry or the industry average. Competitiv e advantage often manifests in other performance measures - ✔✔higher market share and greater profits. how to assess competitive advantage? - ✔✔-compare firm performance to a benchmark. -performance of other firms in the same industry. -an industry averag e. Competitive advantage examples (Google) - ✔✔-In digital advertising google has competitive advantage over facebook, twitter, and yahoo. Competitive advantage example (Apple) - ✔✔Apple has achieved a competitive advantage over samsung, microsoft, and b lackberry competitive advantage - ✔✔superior performance relative to other competitors in the same industry or the industry average. sustainable competitive advantage - ✔✔outperforming relative to other competitors in the same industry or the industry av erage. competitive disadvantage - ✔✔underperformance relative to other competitors in the same industry or the industry average. competitive parity - ✔✔Performance of two or more firms at the same level What is Economic value created?* - ✔✔Difference be tween VALUE to the customer (Customer willingness to pay) and cost: Higher this difference the more likely a firm will gain a competitive advantage. Economic value created formula - ✔✔Customer willingness to pay (Value to the customer) -
cost Higher this difference the more likely a firm will gain a competitive advantage. (when we look at competition between different firms we must compare the gaps between willingness to pay and cost. Where does advil get its competitive advantage? - ✔✔advil has a higher willingness to pay than store brand ibuprophen. Where does allegiant get its competitive advantage? - ✔✔they have a lower cost then airlines like southwest and united to run their business and the same customer willingness to pay. Competitiv e Advantage (Key Points) - ✔✔Competitive advantage and greater economic value creation from: -performing different activities and or -performing the same activities differently from rivals Economic value created and strategic position - ✔✔Competitive adva ntage and greater economic value creation also requires careful strategic positioning Stake out a unique position within an industry to provide value to customers, while controlling costs. Economic value created and strategic position requires conscious t rade off - ✔✔In the retail industry, for example: Walmart: "everyday low prices" Nordstrom's: professional sales people in a luxury setting What strategy is not - ✔✔Grandiose statements Statements of desire Ex: "Our strategy is to win" or "We will be No. #1" A failure to face a competitive challenge Managers must know whether they are making progress in addressing the challenge. Operational effectiveness, competitive benchmarking, or other tactical tools These support competitive strategy, but are not s ufficient to sustain it. Industry Vs Firm Effects in determining firm performance. (Industry Effects) - ✔✔-Describe the underlying economic structure of the industry; determined by elements common to all industries ex. -entry and exit barriers -number a nd size of companies -types of products and services offered -about 20% of a firms probability depends on the industry its in. Industry Vs Firm Effects in determining firm performance. (Firm Effects) - ✔✔firm performance is attributed to managerial actions. -more important factor in determining firm performance then external factors. -firm examples can explain 55% of its performa nce. Stakeholders - ✔✔-Organizations, groups and individuals -they can affect or are affected by a firms actions -Have a vested claim or interest in the performance and continued survival of the firm. Internal stakeholders: Stockholders, employees (inclu ding executives, managers, and workers), and board members External stakeholders: Customers, suppliers, alliance partners, creditors, unions, communities, media, and governments at various levels Economic Value= - ✔✔WTP -Cost What is Vision? - ✔✔What do w e want to accomplish? What is Mission? - ✔✔How do we accomplish our goals. What are Values - ✔✔what commitments do we make? what guardrails do we put in place? How can we act legally and ethically in pursuit of the vision and mission? What are some key aspects of an effective Vision? - ✔✔1. captures an organizations aspiration 2. identifies what it ultimately wants to accomplish 3. motivates employees to aim for a target 4. leaves room for contributors. why is a vision important? - ✔✔Employees tend to feel part of something bigger than themselves. Helps employees find meaning in their work
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