Shared Flashcard Set

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Strategy In-Class
Strategy In-Class
15
Business
Undergraduate 3
04/02/2009

Additional Business Flashcards

 


 

Cards

Term

Collateral Organization

Definition

Ex. GM in Flint Michigan

Meeting between randomly selected people from all levels of organization to deal with problems.

 

Threat? No

Quality Circle? No

Project team? No

 

Benefits are : 1. Pension fund underfunded??

2. people (Hawkins and Granovetter)

 

 

Term

Hawkins (Benefit of Collateral Organization)

Definition

30 students from working class(low class), and 30 from the middle class and showed them a series of 4 pictures telling a story. All 60 students had the same vocab, intellegence, and perception. They did however have a difference in their high variety role set.

The working class had low variety role set:

 Similars: although they are nice people, what can you teach or learn from them?

Stereotypic narrow world: Workers think abotu 5pm and beer while execs think about ROA, ROI, ROE.

 

The middle class had a high variety role set:

Break out of trap, be in the big picture.

 Collaterall organization

 

When explaining the pictures they saw, the working class did not have reference points, and did not explain the story unless you had the pics infront of you, while the middle class students could explain you the story without ever seeing the pics.

Term
Granovetter (Benefit of Collaterall organization)
Definition

There were 2 neighborhoods in boston. They were settled same decade, same old country, both had thriving neighborhoods. As dwellers grow older, neighborhoods go downhill.

 

One neighborhood lived, while the other was wiped out. This was due to the ties. The neighborhood with the strong ties died, while the weak ties lived.

 

This was because the weak ties could still reach out with one hand because they werent wrapped up in their strong ties.

 

SOWT - Strength of Weak ties

Never loose touch with the idea that you need friends in low places.  

Term
Why are some industries fragmented?
Definition

1. Low entry barriers ($, expertise)

2. Absence of econmies of scale

3. Costs (Inventory, Scrap)

4. High Transport Costs of fragmented

5. Regulation (decision between fragmented and consolidation. Trade-off between most modern banking systems and personalized service)

6. Newness of industry

7. Diseconomies of Scale (Fast change, creativity, exculsivity)

8. High exit barriers (Economic barriers - Cant get rid of assets. Psychological barriers - subborn pride).

 

Term
Role of Technology in Strategy
Definition

Strategy has become all about innovation. High and low tech industries can be fragmented or consolidated (face of industry).

 

Consolidation or Fragmentation has no effect on how much technology is used. And how much technology is used has no effect on face of industry.

Term
Economies of Scale (and absence of it)
Definition

Economies of Scale

Price    ->(constant)

-Cost    v    (down)

=Profit   ^         (up)

 

Absence of Economies of Scale

Price    ->(constant)

-Cost    ->(Constant)

=Profit   ->(Constant)

Term
Diseconomies of Scale
Definition

Price    ->(constant)

-Cost    ^         (up)

=Profit   v      (Down)

Term
How do we overcome fragmentation and create concentration?
Definition

1. Create economies of scale

2. Standardize and modularize

(Grow large by redesigning processes to be abke to produce one industry all in one company) ex. chairs...back, legs, seats, all same place

3. Neutralize time and distance (omni-presence)

Run stores in all different places (franchising) this lowers transport costs by being everywhere all at once.

Term

History of Strategy timeline

Definition
PhaseEraAimFocus
Financial planning1940sCalculate futureBudget
Forecasting1970sPredict futureTrends
Strategic planning1990s – 2000sDevelop alternative futuresAgility
Strategic management2005 – FutureShape the futureProactivity (doing)
Term

Concentrated vs Fragmented Industry

Definition

Concentrated

  • 4 biggest firms in the industry control more than 40% market share.

 

Fragmented

  • 4 biggest firms in the industry control less than 40% market share.
Term
US phonograph industry
Definition
YearTop 4 Firms
195778% - Giants Rule
196144% - Giants fall
196526% - Giants die
196951% - Giants rise

 

'69 had a bigger industry than in '57, so half was actually even better than 78%

Term
Enviroment and Organizations
Definition

O>E and E>O (both correct)

> is have power over.

 

O>E IFF (only need 1)

1. Slack resources

2. Flexibility (like ninjas - dont get wet)

3. Proactivity

4. Enviromental Scanning (needle in a haystack, but if you find it, its all worth it)

Term
Giants today in Music
Definition

Company                           Headquarters

 

Sony                                Japan

Bertelsman(Merged)                      Germany

 

EMI                                 Britain

 

Vivendi Universal              France

 

WMG                               USA

Term
Music is like candles
Definition

Then: The industrial age - Perfect and cheap - analog.

 

Now: Info age - Perfect, fluid, almost free (downloading music)  - digital

 

Future: Authentic, personalized (not vanilla), and liquid. Those who look for the new will be succesful.

 

 

Candles: Used to be for the rich, were a sign of luxury. Then electricity came and were for the poor. Then electricty was around for even the poor, and candles became luxurious again. Now scented candles are for the rich and luxurious.

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