Chapter 6 MANAGEMENT NOTES.docx

4 Pages
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Department
Management (MGT)
Course Code
MGTA01H3
Professor
Zachariah Campbell

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Description
Chapter 6: Business Strategy Who Are Managers?: - All corporations depend on effective management - Must develop strategic & tactical plans - Analyze competitive environments & plan, organize, direct & control day-to- day operations - Principles of management apply to all sorts of organizations Setting Goals & Formulating Strategy: - Starting point in effective management = setting goals - Goals: objectives that a business hopes & plans to achieve, performance targets by which organizations & managers measure success & failure at each level - Strategy is a broad term that underlies the decisions about actions a business needs to take Setting Goals - 4 purposes of Goal Setting o Provide direction, guidance, motivation for all managers  knowing where a company is headed = less error o Helps firms allocate resources st  areas expected to grow get 1 priority compared to mature areas o Helps define corporate culture  to become #1, results in competitive & stressful envmt & a culture that rewards success ex. GE o Helps managers assess performance  are you meeting the goals or not? - Kinds of goals - Every enterprise has a purpose – a reason for being - Also have a mission statement - Mission statement: an organization’s statement of how it will achieve its purpose in the environment in which it conducts its business, also includes statements about company’s core values & commitment to ethical behaviour - 2 businesses can have same purpose but different missions – ex. selling watches but cheap vs. high-class watches - Types of goals: o long-term goals: goals set for extended periods of time, 5+ years o intermediate goals: goals set for a period of 1-5 years o short-term goals: goals set for the very near future, less than 1 year Formulating Strategy: - Planning = nuts & bolts of setting goals, choosing tactics, est. schedules - BUT strategy has a wider scope – “broad program” that describes an organizations intentions, outlines how it intends to meet its goals, & includes organization’s responsiveness to new challenges & new needs - Strategy formation: creation of a broad program for defining & meeting an organization’s goals - SAMP – Set, Analyze, Match, Plan  Setting Strategic Goals - Strategic goals: long term goals derived directly from a firm’s mission statement - (Remember: strategic usually complies w/ long term things) - SWOT analysis: identification & analysis of organizational strengths & weaknesses and environmental opportunities & threats as part of strategy formulation o Organizational strengths & weaknesses = internal o Environmental opps & threats = external o Assessing these things o Want to capitalize on strengths & opps and overcome weaknesses & threats Analyzing the Organization and Its Environment - Environmental analysis: the process of scanning the environment for threats and opportunities – external factors o threats: changing consumer tastes, hostile take over, new govt regulations, new products, new competitors o opportunities: areas firm can grow/expand, take advantage of existing strengths o EX. Richard Branson & Virgin Group Ltd. - Organizational analysis: the process of analyzing a firm’s strengths & weaknesses – internal factors o strengths: surplus cash, dedicated workforce, lots of managerial talent, technical expertise, weak competition o weakness: absence of any of these strengths M
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