Term
| Two aspects of strategic control |
|
Definition
Informational- The ability to EFFECTIVELY respond to environmental changes
Behavioral- appropriate balance and alignment among firm’s culture, rewards, and boundaries
|
|
|
Term
| Problems with the Traditional Approach to Strategic Control |
|
Definition
* Top down management and strategy
*Lengthy time lags in feedback
*A strategy needs to change frequently and be flexible to adapt |
|
|
Term
| Information Control ( Contemporary Approach to strategic control) |
|
Definition
IS the firm doing the right things?
*Must scan external and internal environment |
|
|
Term
| Behavioral control (Contemporary Appraoch in strategic Control) |
|
Definition
Is the firm doing "things right"?
|
|
|
Term
| Benefits of the Contemporary Appraoch to Strategic Control |
|
Definition
Double Loop Feedback- everything is constantly tested, measured, and reviewed
Shortened time lags for information
changes in competetive environment are detected early |
|
|
Term
| Effective Strategy Implementation requires 3 things: |
|
Definition
1.culture
2. rewards
3. boundaries |
|
|
Term
| Successful Rewards Systems have the following attributes: |
|
Definition
1. The objectives are clear and well understood
2.Rewards are clearly linked to desired behavior
3.Performance measures are clear and visible
4. Feedback is prompt and unambiguous
5.Compensation is fair
6.Flexible- adapt to changing circumstances |
|
|
Term
In most environments, organizations should strive to provide a system of rewards and incentive, coupled w/ culture strong enough that boundaries become internalized
This is done by the following: |
|
Definition
*Hiring the right people
*Doing a good job at Training
*Choosing great managerial role models
*Creating reward systems that align with company goals |
|
|
Term
|
Definition
| the relationship among the participants in determining the direction and performance of a corporation. Primary participants are shareholders, management, and board of directors. |
|
|
Term
|
Definition
Focused on the separation of ownership from management
- Since managers are insiders, they may not act in the best interest of the shareholders (and therefore shouldn't be on the Board) |
|
|
Term
| External governance control mechanisms |
|
Definition
– methods that ensure that managerial actions lead to shareholder value maximization and do not harm other stakeholder groups.
These are outside the control of the corporate governance system |
|
|
Term
| Examples of external governance control mechanisms |
|
Definition
The Market for Corporate Control (if shareholders are unsatisfied, they sell their shares and value of firm drops)
Auditors
Banks and Analysts
Regulatory Agencies |
|
|
Term
| Three interdependent activies that all leaders should constantly be doing: |
|
Definition
1. Setting a direction (by analysing and formulating a strategy)
2. Designing the organization (creating ways of formulating the your vision and strategy)
3.Nuture a culture dedicated to excellence and ethical behavior |
|
|
Term
| Two Elements of Effective Leadership |
|
Definition
1. Overcoming barriers to Change
2.Effective Use of Power |
|
|
