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Chapter+13+solutions - CHAPTER 13 STRATEGIC PLANNING AND...

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C HAPTER 13 S TRATEGIC P LANNING AND C ONTROL SOLUTIONS R EVIEW Q UESTIONS 13.1 Cost leadership, and value differentiation. 13.2 (1) Industry competitors, (2) new entrants, (3) substitute products, (4) supplier power, and (5) customer power. 13.3 The key source of customer value. 13.4 Yes, this is generally true. 13.5 The value chain is a set of logically sequenced, value-adding activities that convert input resources into products or services in a manner consistent with the chosen business strategy. 13.6 (1) List all activities and prepare the activity map, (2) Identify performance linkages across activities, (3) Engineering activities, and (4) Determine activity-sourcing. 13.7 Product life-cycle analysis emphasizes that the objective is to maximize the profitability of a product over its entire life cycle and not stage-by-stage. 13.8 (1) Development, (2) Introduction, (3) Growth, (4) Maturity, and (5) Decline. 13.9 Target costing as a structured approach to cost planning and management – it determines cost by working backward from the customer’s value. 13.10 Because it’s important to know where we have been and where we are going. Lagging in- dicators reflect past performance, whereas leading indicators are drivers of future per- formance. 13.11 Financial measures are (1) aggregate, (2) are not always timely, and (3) do not provide specific information about potential areas of concern. 13.12 Just like a pilot, managers need to attend to multiple measures and gauges of a perform- ance to ensure that the company is headed in the right direction. 13.13 Critical success factors, also known as key performance indicators, are performance measures that must go right for an organization to implement its strategy and successfully achieve its mission. Outcomes of the critical success factors are the pulse of the organiza- tion’s survival. Organizations have both short- and long-term critical success factors. Critical success factors should be: (1) simple and easy to understand, (2) readily quantifi- able, (3) easy to monitor, and (4) linked to strategy. 13.14 A balanced scorecard is a performance measurement system that includes a systematic approach for linking strategy to planning and control. The four components, or perspect- ives, are (1) financial, (2) customer, (3) internal business, and (4) innovation and learn- ing.
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13.15 Balance is obtained by attending to (1) financial and non-financial measures, (2) short- and long-term objectives, (3) past and forward-looking measures, (4) “hard” and “soft” measures, and (5) external and internal measures. That is, excessive weight is not placed on any single measure or perspective. D ISCUSSION Q UESTIONS 13.16 Ultimately, the value proposition offered by top-tier business schools is the increased probability of future success in a business career. This gain arises from several sources which include the value of alumni network, the “halo” effect that arises from a degree from a prestigious program, access to top-notch faculty and facilities and so on.
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Chapter+13+solutions - CHAPTER 13 STRATEGIC PLANNING AND...

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