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Chapter 2

BUSI 3103 Chapter Notes - Chapter 2: Organizational Culture, Rogers Communications, Walmart


Department
Business
Course Code
BUSI 3103
Professor
Pal Shibu
Chapter
2

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Chapter 2: Design, Strategies, and Effectiveness
Organizational Purpose
Mission (official goals): reason the business exists; definition of business scope and outcomes the organization is
trying to achieve; serves as a communication tool to current and prospective employees, customers, investors,
suppliers, and competitors- communicates what the company stands for and what it is trying to achieve
o IMPORTANCE: describe value system and legitimize the organization
o Vision: captures core ideology and the envisioned future for the company
o Values: company’s moral code
Operative goals: describe specific short-run outcomes; typically refer to the organization’s primary tasks; easy to
track, measure, and compare
o Overall performance profitability, growth, and output volume
o Innovation and change innovation goals pertaining to internal flexibility and readiness to adapt to
unexpected changes in the environment
o Resources how well the organization is at financial and material procurement
o Market market share or market standing
o Employee development training, promotion, safety, and growth of employees
o Productivity ratio of outputs to inputs
IMPORTANCE: well defined, explicit organizational tasks; better at driving and shaping behaviour
in that it provides employees with a sense of direction, provides employees with a guide to good
decision making and behaviour, and provides a standard for assessment
Selecting Strategy and Design
Strategy: a plan for taking a company’s core competencies to apply them in such a way that will create a
competitive advantage which will help in accomplishing organizational goals
Porter’s Competitive Strategies
Competitive Advantage
Low Cost
Uniqueness
Competitive
Scope
Broad
Low-Cost Leadership
Organizations attempt to succeed by
having lower prices than the
competition
Based on organizational efficiencies
Could reduce brand image
Differentiation
Organizations attempt to succeed by
differentiating themselves from the
competition in areas such as
advertising, product features, and
quality of service
Customers have little concern over
price
Good for increasing brand loyalty
Expensive
Narrow
Focused Low-Cost Leadership
Focused Differentiation
Organizations attempt to succeed by targeting a specific market niche
Miles and Snow’s Strategy Typology
Prospector
Defender
Learning orientation; flexible, fluid decentralized
structure
Values creativity, risk-taking and innovation
Well suited to a developing market, focus on
creativity, not efficiency
Examples: Shopify, Tesla, Nike
Efficiency orientation, centralized authority and tight
cost control
Emphasis on efficiency and close supervision
Most suitable for stable or declining industry
Examples: Governments, McDonald’s Wal-Mart
Analyzer
Reactor
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