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BU111 FINAL.docx

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Department
Business
Course
BU111
Professor
Laura Allan
Semester
Fall

Description
BU111 FINAL CRITICAL SUCCESS FACTORSAchieving financial performanceMeeting customer needsBuilding quality products and servicesEncouraging innovation and creativityGaining employee commitmentCreating a distinct competitive advantage DiamondE FrameworkIdentifies key variables to be considered in strategic analysis and the critical relationships between them ManagementPreferencesEnvironment StrategyOrganizationResources Importance of strategy The critical linking variable in the model Tells you what opportunities in the environment the business is pursuing Determines resources organizational capabilitiesmanagement preferences required Any variable can either drive or constrain strategy DiamondEPrincipal logic Principal logicconsistency or alignmentsConsistency internally leads to performanceEach variable impacts and is impacted by the restAlignment externally ensures strategy right for the given environmentWarning environment always changingis strategy in alignment with environmentis strategy consistent with internal variables External analysisProcess of scanning and evaluating the external environmentHow managers determine opportunities positive external trends or changes and threats negative external trends or changesFirms face multiple environmentsgeneral environment affects all businesses Specific environment affects industry participantsHow to do an external analysisGeneral environmentPEST modelconsiders political environmental socialdemographic and technological factor Identifies general trends and changesSpecific environmentPorters Five Forcesanalyzes five important sources of competitive pressure and intensity predicts profitability of industryLook for data statistics trends forecasts expert opinions etc PEST PoliticalElementsLaws regulations TaxesTrade agreements or conditionsPolitical systemPolitical stability Government can create incentives constraints or supportbail out when needed Affects uncertainty risk and constraintscosts faced by firm Economic ElementsEconomic growthaggregate output GDP and standard of livingTrade balanceimporting vs exportingNational debtgovernment borrowinEconomic stabilityinflation Interest ratestime value of moneyExchange rates Influences costs potential sales and financial uncertainty Social Elementscustoms values attitudes and demographic characteristicsInfluences customer preferencesInfluences worker attitudes and behavioursInfluences standards of business conductEthics social responsibility stakeholder management Affects how we live work consume and produceTechnological ElementsInternet affects buying selling communicationInformation technologies affects information access interfirm cooperation cycle timesComputer technologies have changed our products and how we design and buildNot limited to computers and information Affects what we producewhat it can do affects how we produce and how we sell Demands constant learning and scanning Three most important issues facing Canadian business 1 The value of the Canadian dollar 2 A skilled labour shortage 3 The naturalphysical environmentPorters Five ForcesEffect on Profitability
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