Management 3280 – Exam 1
Chapter 1 – Strategic Management: Creating Competitive Advantages
Romantic view of leadership –
implicit assumption is that the leader is the key force
determining the organization’s success – or lack thereof
External control view of leadership
– focus is on external factors that may positively (or
negatively) affect a firm’s success
Leadership has limited influence over the external forces that determine the
organization’s success (e.g. economic downturns, new technologies, government
regulation, major conflict or war)
It is important to point out that successful executives are often able to navigate around the
difficult circumstances that they face
WHAT IS STRATEGIC MANAGEMENT?
Managers must go beyond “incremental management,” whereby they view their job as making a
series of small, minor changes to improve the efficiency of their firm’s operations. Today’s
leaders must be proactive, anticipate change, and continually refine and, when necessary, make
dramatic changes to their strategies.
Strategic management –
the analyses, decisions, and actions an organization undertakes in
order to create and sustain competitive advantages (note the three ongoing processes:
Strategic management is concerned with the
of strategic goals (vision, mission,
and strategic objectives) along with the analysis of the internal and external environments
of the organization.
Leaders must make strategic
which address two basic questions:
What industries should we compete in?
How should we compete in those industries?
Decisions are of little use unless they are
. Firms must take the necessary actions
to implement their strategies.
the ideas, decisions, and actions that enable a firm to succeed
The essence of
is the study of why some firms outperform others.
Managers need to determine how a firm is to compete so that it can obtain certain advantages
that are sustainable over a lengthy period of time:
Competitive advantage –
a firm’s resources and capabilities that enable it to overcome the
competitive forces in its industry(ies)