Chapter 1 Managing
Knowledge management- Practices aimed at discovering and harnessing an organization’s intellectual resources.
Quality- The excellence of your product (goods or services).
Service- the speed and dependability with which an organization delivers what customers want.
Speed- Fast and timely execution, response, and delivery of results.
Cost Competitiveness- Keeping costs low to achieve profits and ba able to offer prices that are attractive to customers.
Management- The process of working with people and resources to accomplish organizational goals. Efficient and effective.
Planning- Systematically making decisions about the goals and activities that an individual, a group, a work unit, or the overall organization will pursue. analyzing current situations, anticipating the future, determining objectives, deciding in what types of activities the company will engage.
Value- The monetary amount associated with how well a job, task, good, or service meets users needs.
Organizing- assembling and coordinating the human, financial, physical, informational, and other resources needed to achieve goals. Specifying job responsibilities, grouping jobs into work units, marshaling and allocating resources.
Leading- The management function that involves the manager’s efforts to stimulating people to be high performers.
Controlling- The management function of monitoring performance and making needed changes.
Technical skills- The ability to perform a specialized task, involving a particular method or process.
Conceptual and Decision Roles- Skills pertaining to the ability to identify and resolve problems for the benefit of the organization and its members.
Interpersonal and communication skills – People skill; the ability to lead, motivate, and communicate effectively with others.
Emotional intelligence- The skills of understanding yourself, managing yourself, and dealing effectively with other.
Social capitol- Goodwill streaming from your social relationships.
Chapter 2 The External Environment and Organizational Culture
Open systems- Organizations that are affected by, and that affect, their environment.
Inputs- Goods and services organizations take in and use to create products or services.
Outputs- The products or services organizations create.
External Environment- All relevant forces outside a firm’s boundaries such as competitors, customers, the government, and the economy.
Competitive Environment- The immediate environment surrounding a firm; includes suppliers, customer, rivals, and the like.
Macroenvironment- The general environment; includes governments, economic conditions, and other fundamental factors that generally affect all organizations.
Demographics- Measures of various characteristics of the people who make up groups or other social units.
Barriers to entry- Conditions that prevent new companies from entering an industry.
Switching Costs- Fixed costs buyers face when they change suppliers.
Supply Chain Management- The managing of the network of facilities and people that obtain materials from outside the organization, transform them into products, and distribute them to customers.
Final Customer- Those who purchase products in their finished form.
Intermediate Consumer- A customer who purchases raw materials or wholesale products before selling them to final customers.
Environmental uncertainty- Lack of information needed to understand or predict the future.
Environmental Scanning- Searching for and sorting through information about the environment.
Competitive Intelligence- Information that helps managers determine how to compete better.
Scenario- A narrative that describes a particular set of future conditions.
Forecasting- Method for predicting how variables will change the future.
Benchmarking- The process of comparing an organization’s practices and technologies with those of other companies.
Buffering- Creating supplies of excess resources in case of unpredictable needs.
Smoothing- Leveling normal fluctuations at the boundaries of the environment.
Flexible Processes- Methods for adapting the technical core to changes in the environment.
Independent Strategies- Strategies that an organization acting on its own uses to change some aspects of its current environment.
Cooperative Strategies- Strategies used by two or more organizations working together to manage the external environment.
Strategic maneuvering-An organization’s conscious efforts to change the boundaries of its task environment.
Domain selection- Entrance to a new market or industry with an existing expertise.
Diversification- Occurs when a firm invests in a different product, business, or geographic area.
Mergers- One or more companies combine with another.
Acquisitions- One firm buys another.
Divestiture- A firm sells one or more businesses.
Prospectors- Continuously change the boundaries or their task environment by seeking new products and markets, diversifying and merging, or acquiring new enterprises.
Defenders- Stay within a stable product domain as a strategic maneuver.
Chapter 3 Managerial Decision making
Programmed decisions- Decisions encountered and made before, having objectively correct answers, and solvable by using simple rules, policies, or numerical computations.
Nonprogrammed decisions- New, novel, complex decisions having no proven answers.
Certainty- The state that exists when the decision makers have accurate and comprehensive information.
Uncertainty- The state that exists when the decision makers have insufficient information.
Risk- The state that exists when the probability of success is less than 100% and losses may occur.
Conflict- Opposing pressures from different sources, occurring on the level of psychological conflict or of conflict between individuals or groups.
Ready made solutions- Ideas that have been seen or tried before.
Custom-made solutions- New, creative solutions designed specifically for the problem.
Contingency Plans- Alternative courses of action that can be implemented based on how the future unfolds.
Maximizing- A decision realizing the best possible outcome.
Satisficing- Choosing an option that is acceptable, although not necessarily the best or perfect.
Optimizing- Achieving the best possible balance among several goals.
Vigilance- A process in which a decision maker carefully executes all stages of decision making.
Illusions of Control- People’s belief that they can influence events, even when they have no control over what will happen.
Framing Effects- A decision bias influenced by the way in which a problem or decision alternative is phrased or presented.
Discounting the Future- A bias weighting short-term costs and benefits more heavily than long-term costs and benefits.
Group link- A phenomenon that occurs in a decision making when group members avoid disagreement as they strive for consensus.
Goal Displacement- A condition that occurs when a decision making group losses sight of its original goal and is now, less important goal emerges.
Cognitive conflict- Issue-based differences in perspectives or judgments.
Affective conflict- Emotional disagreement directed toward other people.
Devil’s advocate- A person who has the job of criticizing ideas to ensure that their downsides are fully explored.
Dialectic- A structured debate comparing two conflicting courses of action.
Brainstorming- A process in which group members generate as many ideas about a problem as they can; criticism is withheld until all ideas have been proposed.
Bounded Rationality- A less than perfect form of rationality in which decision makers cannot be perfectly rational because decisions are complex and complete information is unavailable or cannot be fully processed.
Incremental Model- Model of organizational decision making in which major solutions arise through a series of smaller decisions.
Coalitional Model- Model of organizational decision making in which groups with differing preferences use power and negotiation to influence decisions.
Garbage can Model- Model of organizational decision making depicting a chaotic process and seemingly random decisions.
Chapter 4 Planning and Strategic Management
Situational Analysis- A process planner’s use, within time and resource constraints, to gather, interpret, and summarize all information relevant to the planning issue under consideration.
Goals- A target or end that management desires to reach.
Plans- The actions or means managers intend to use to achieve organizational goals.
Scenario- A narrative that describes a particular set of future conditions.
Strategic Goals- Major targets or end results relating to the organization’s long-term survival, value, and growth.
Strategy- A pattern of actions and resources allocations designed to achieve the organizations goals.
Tactical Planning- A set of procedures for translating broad strategic goals and plans into specific goals and plans that are relevant to the distinct portion of the organization, such as a functional area like marketing.
Operation Planning- The process of identifying the specific procedures and processes required at lower levels of the organization.
Strategic Management- A process that involves managers from all parts of the organization in the formulation and implementation of strategic goals and strategies.
Stakeholders- Groups and individuals who effect and are effected by the achievement of the organization’s mission, goals, and strategies.
Resources- Inputs to a system that can enhance performance.
Core Competence- A unique skill and/or knowledge an organization possesses that gives it an edge over competitors.
SWOT Analysis- A comparison of strengths, weaknesses, opportunities, and threats that help executives formulate strategy.
Corporate Strategy- The set of businesses markets, or industries in which an organization competes and the distribution or resources among those entities.
Concentration- A strategy employed for an organization that operates a single business and competes in a single industry.
Vertical Integration- The acquisition or development of new businesses that produce parts or components of the organization’s product.
Concentric Diversification- A strategy used to add new businesses that produce related products or are involved in related markets and activities.
Conglomerate Diversification- A strategy used to add new businesses that produce unrelated products or are involved in unrelated markets and activities.
Business Strategy- The major actions by which a business competes in a particular industry or market.
Differentiation Strategy- a strategy an organization uses to build competitive advantages by being unique in its industry or market segment along one or more dimensions.
Functional Strategies- Strategies implemented by each functional area of the organization to support the organization’s business strategy.
Strategic Control System- A system designed to support managers in evaluating the organization’s progress regarding its strategy and, when discrepancies exist, taking corrective action.
Chapter 5 Ethics and Corporate Responsibilities
Ethics- The system of rules that governs the ordering of values.
Ethical Issues- Situations, problem or opportunity in which an individual must choose among several actions that must be evaluated as morally right or wrong.
Business Ethics- The moral principles and standards that guides behavior in the world of business.
Moral Philosophy- Principles, rules and values people use in deciding what is right or wrong.
Universalism- The ethical system stating that all people should uphold certain values that society needs to function.
Kyosei - living and working together for the common good, allowing cooperation and mutual prosperity to coexist with healthy and fair competition.
Human dignity- concerns the value of each person as an end, not a means to the fulfillment of others’ purposes.
Egoism- An ethical system defining acceptable behavior as that which maximizes consequences for the individual.
Utilitarianism- An ethical system stating that the greatest good for the greatest number should be the overriding concern of decision makers.
Relativism- Philosophy that bases ethical behavior on the opinions and behaviors of relevant other people.
Virtue ethics- Classification of people based on their level of moral judgment.
Kohlberg’s model of cognitive moral development- Perspective that what is moral comes from what a mature person with “good” moral character would deem right.
Sarbanes-Oxley Act- An act passed into law by Congress in 2002 to establish strict accounting and reporting rules in order to make senior managers more accountable and to improve and maintain investor confidence.
Ethical Climate- In an organization, the process by which decisions are evaluated and made on the basis of right and wrong.
Ethical Leader- One who is both a moral person and a moral manager influencing to behave ethically.
Compliance-based Ethics Programs- Company mechanisms typically designed by corporate counsel to prevent, direct, and punish legal violations.
Integrity-based Ethics Programs- Company mechanisms designed to install in people a personal responsibility for ethical behavior.
Corporate Social Responsibility- Obligation towards society assumed by business.
Economic Responsibility- To produce goods and services that society wants at a price that perpetuates the business and satisfies its obligations to investors.
Legal Responsibilities- To obey local, state, federal, and relevant international laws.
Ethical Responsibilities- Meeting other social expectations, not written as law.
Philanthropic Responsibilities- Additional behaviors and activities that society finds desirable and that the values of the business support.
Transcendent Education- An education with the five higher goals that balance self-interest with responsibility to others.
Making ethical decisions takes:
- Moral awareness- realizing the issue has ethical implications
- Moral judgment- knowing what actions are morally defensible
- Moral character- the strength and persistence to act in accordance with your ethics despite the challenges.
Ecocentric Management- Its goal is the creation of sustainable economic development and improvement of quality of life worldwide for all organizational stakeholders.
Sustainable Growth- Economic growth and development that meet present needs without harming the needs of future generations.
Life-cycle analysis (LCA)- A process of analyzing all inputs and outputs, though the entire “cradle-to-grave” life of a product, to determine total environmental impact.
Danger Signs:
- Excessive emphasis on short-term revenues over longer-term considerations.
- Failure to establish a written code of ethics.
- A desire for simple, “quick fix” solutions to ethical problems.
- An unwillingness to take an ethical stand that may impose financial costs.
- Consideration of ethics solely as a legal issue or a public relations tool
- Lack of clear procedures for handling ethical problems.
- Responding to the demands of shareholders at the expense of other constituencies
Chapter 6 International Management
The Global Environment
-The global economy is dominated by countries in three regions: North America , Western Europe , and Asia .
-Other developing countries and regions represent important areas for economic growth.
European Unification
-Europe is integrating economically to form the biggest market in the world.
-Certain structural issues within Europe need to be corrected for the EU to function effectively.
Consequences of a Global Economy
- Expansion of international trade.
- Foreign direct investment (FDI) is playing an ever-increasing role in the global economy.
- Imports are penetrating deeper into the world’s largest economies.
- Companies are finding their home markets under attack from foreign competitors.
Factors to Consider for Offshoring
What is the competitive advantage of the products they offer?
Is the business in its early stages?
Can production savings be achieved locally?
Can the entire supply chain be improved?
Expatriates- Parent-company nationals who are sent to work at a foreign subsidiary.
Ethnocentrism- The tendency to judge others by the standards of one’s group or culture, which are seen as superior.
Culture shock- The disorientation and stress associated with being in a foreign environment.
Power distance- The extent to which a society accepts the fact that power in organizations is distributed unequally.
Individualism/collectivism- The extent to which people act on their own or as a part of a group.
Uncertainty avoidance- The extent to which people in a society feel threatened by uncertain and ambiguous situations.
Masculinity/femininity- The extent to which a society values quantity of life over quality of life.
North American Free Trade Agreement (NAFTA)- An economic pact that combined the economies of the United States Canada Mexico
Outsourcing- Contacting with an outside provider to produce one or more of an organization’s goods or services.
Offshoring- Moving work to other countries.
International Model- An organizational model that is composed of a company’s oversea subsidiaries and characterized by greater control by the parents, company over the research function and local product and marketing strategies than is the case in the multinational model.
Multinational Model- An organizational model that consists of subsidiaries in each country in which a company does business, with ultimate control exercise by the parent company.
Transnational Model- An organizational model characterized by centralizing certain functions in locations that best achieve cost economies; basing other functions in the company’s national subsidiaries to facilitate greater local responsiveness; and fostering communication among subsidiaries to permit transfer of technological expertise and skills.
Expatriates- Parent-company nationals who are sent to work at a foreign subsidiary.
Host-Country Nationals- Natives of the country where an overseas subsidiary is located.
Third-Country Nationals- Natives of the country other than the home country or the host country of an overseas subsidiary.
Failure Rate- The number of expatriate managers of an overseas operation who come home early.
Ethnocentrism- The tendency to judge others by the standards of one’s group or culture, which are seen as superior.
Culture shock- The disorientation and stress associated with being in a foreign environment.
Inpatriate- A foreign national brought in to work at the parent company.
Power distance- The extent to which a society accepts the fact that power in organizations is distributed unequally.
Individualism/collectivism- The extent to which people act on their own or as a part of a group.
Uncertainty avoidance- The extent to which people in a society feel threatened by uncertain and ambiguous situations.
Masculinity/femininity- The extent to which a society values quantity of life over quality of life.
Chapter 7 Entrepreneurship
Entrepreneurship: The pursuit of lucrative opportunities by enterprising individuals.
Small Business- A business having fewer than 100 employees, independently owned and operated, not dominated in its field, and not characterized by many innovative practices.
Entrepreneurial Venture- A new business having growth and high profitability as their primary objectives.
Entrepreneur- Individuals who establish a new organization without the benefit of corporate sponsorship.
Intrapreneurs- New-venture creators working inside big companies.
Franchising- An entrepreneurial alliance between a franchisor (an innovator who has created at least one successful store and wants to grow) and a franchisee (a partner who manages a new store of the same type in a new location).
Transaction Fee Model- Charging fees for goods and services.
Advertising Support Model- Charging fees to advertise on a site.
Intermediary Model- Charging fees to bring buyers and seller together.
Affiliated Model- Charging fees to direct site visitors to other companies sites.
Subscription Model- Charging fees for site visits.
Business Incubators- Protected environments for new, small businesses.
Initial Public Stock Offering (IPO)- Sale
Business Plan- A formal planning step that focuses on the entire venture and describes all the elements involved in starting it.
Legitimacy- People’s judgment of a company’s acceptance, appropriateness, and desirability, generally stemming from company goals and methods that are consistent with societal values.
Social Capitol- A competitive advantage in the form of relationships with other people and the image other people have of you.
Skunkworks- A project team designated to produce a new, innovative product.
Bootlegging- Informal work on projects, other than those officially assigned, of employees’ own choosing and initiative.
Entrepreneurial orientation- The tendency of an organization to identify and capitalize successfully on opportunities to launch new ventures by entering new or established markets with new or existing goods or services.
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