BMT 2750 Week 1 :

Summary Review Questions: 1. How is "strategic management" defined in the text, and what are its four key attributes?
Defined as: Consists of the analyses, decisions, and actions an organization undertakes in order to create and sustain competitive advantages. * “Overall organizational goals and objectives”
* Including multiple stakeholders in decision making.
* “incorporating both short­term and long term perspectives”
* The balancing of Effectiveness vs. Efficiency 2. Briefly discuss the three key activities in the strategic management process. Why is it important for managers to recognize the interdependent nature of these activities?
The three key activities are: * Analysis: Where managers obtain a understanding of the company's internal, external environment, and goals. This helps lay the foundations for the following activities. * Decisions: is the plans that companies come up with to outperform rival companies. By using the analysis they can better decide what strategies work best for their companies, and what they can do when things change to stay ahead of the competition. * Actions: This is when the company distributes necessary resources, and come up with plans to make the strategies a reality. The interdependence of these activities show when the company starts implements their well planned out strategies. Because you can't plan for everything, and things constantly change in/outside of their firm and competing firms. So they will have to keep adapting, changing, renewing their strategies, goals, plans, as the situation dictates. 3. Explain the concept of "stakeholder management." Why shouldn't managers be solely interested in stockholder management, that is, maximizing the returns for owners of the firm—its shareholders? Stakeholder management is when multiple groups that hold influence on the firm are a part of the decision making. This way the stockholders needs, and interest are always considered in the plans. The reason managing in this way is bad is because stockholders only have their own interest in mind, and not the future of the firms. So their decisions are more likely to side with more

short­term ventures that would show results faster but lack the more long­term goals larger profitability margin. 4. What is "corporate governance"? What are its three key elements and how can it be improved? Corporate governance is defined as “the relationship among various participants in determining the direction and performance of corporation. The primary participants are (1) Shareholders, (2)
Management (led by the chief executive officer), and (3) the board of directors.” A way to improve this is to include stakeholders on the board of directors so that management will have a closer connection to what the customers and shareholders want, and make them more socially responsible in their pursuit of profits. This will also allow the management to see any mutual interest that the stockholders may have that would lead to an increased long­term profit. 5. How can "symbiosis" (interdependence, mutual benefit) be achieved among a firm's stakeholders? By finding what both customers, and shareholders are willing to give and take to get what they want in the end. Such as shareholders wanting the price raised for profit increase, and the customers willing to pay it for a higher quality of service or product. 6. Why do firms need to have a greater strategic management perspective and empowerment in the strategic management process throughout the organization? Because top management can only informing the firms strategies to the lower level managers.
Who the responsibility has been delegated down to so that they may respond promptly to the needs of the customers and stakeholders when opportunities present themselves. 7. What is meant by a "hierarchy of goals"? What are the main components of it, and why must consistency be achieved among them? The hierarchy of goals includes the vision, mission statement, and strategic objectives. This pyramid of goals ranges from the inspiring vision for the company that is a long term nonspecific image of what the company wishes to become or be seen as. The mission statement is more detailed containing the core purpose, and range of operations that the company covers. The strategic objectives are the most specific immediate goals covering how the mission statements purpose can be achieved in a timely matter.

Ethics Questions:

1. A company focuses solely on short­term profits to provide the greatest return to the owners of the business (i.e., the shareholders in a publicly held firm). What ethical issues could this raise? It would give the company the image that they are just about the bottom line. Earning profit is the most important thing to them. This will also make it harder for them to make long term investments in their future, because they will be cutting it for the short term returns. An example of this is a small town in WV called Huntington. The town is more focused on the short term profit gains that they continually fail to make investments in it's own future. Hurting itself in the long run. They had a chance to have I­60 run through their town, but refused because they wanted to stay a small town. Charleston 40 min drive down the highway took this opportunity, and has grown into a large prosperous city. The Pepsi factory that had been in Huntington for years was wanting to rebuild a new plant, and asked for any kind of tax breaks. Huntington refused, and said they would give no benefits or tax breaks. Pepsi moved their factory plans into Virginian. 2.
A firm has spent some time—with input from managers at all levels—in developing a vision statement and a mission statement. Over time, however, the behavior of some executives is contrary to these statements. Could this raise some ethical issues? Yes, because not leading by example always leaves the people under management thinking: If they don't have to why should I. This resentment is bad for moral, and in the end will create a bad work environment.

Application Questions Exercises: 1. Go to the Internet and look up one of these company sites: www.walmart.com, www.ge.com, or www.fordmotor.com. What are some of the key events that would represent the “romantic” perspective of leadership? What are some of the key events that depict the “external control” perspective of leadership?
I picked Walmart. Romantic perspective of leadership: Sam Walton opened the first Walmart in 1962 at the age of
44 in Rogers, Arkansas. Sam based his business idea around offering lower prices, and great customer service. External Control perspective of leadership: Walmart sells its products at the lowest price that it can provide. 2.
Select a company that competes in an industry in which you are interested. What are some of the recent demands that stakeholders have placed on this company? Can you find examples of how the company is trying to develop “symbiosis” (interdependence and mutual benefit) among its stakeholders? (Use the Internet and library resources.)

In the security industry the Companies/insurance agencies want to pay the least for the most qualified. The security industry has used the offering of different levels of qualified security personnel to achieve symbiosis with the customer. Going from cheapest to highest (least qualified/experienced to most qualified/experienced): Unarmed no military/police background, nonlethal capability only no military/police background, armed personnel no military/police background, unarmed/non lethal capability only with military/police background, and finally armed with military/police background is the most expensive. 3. Provide examples of companies that are actively trying to increase the amount of empowerment in the strategic management process throughout the organization. Do these companies seem to be having positive outcomes? Why? Why not? Google is a prime example of a company that is empowering their employees throughout their organization. With their popularity, and stocks ever rising the outcome is obvious. By allowing their employees as many channels for their expression as they can they continuously get the best results in different ways out of them. Just like everyone learns in different ways so it's true with thinking up, and working on new ideas. One of Google's ways of doing this is by allowing their employees 20% of their work week to work on projects that interest them. They also have weekly all­hands meetings that allow employees to ask questions directly to top management about any company issues. This helps with the flow of information, and getting problems solved instead of getting bogged down in red tape/bureaucracy. 4. Look up the vision statements and/or mission statements for a few companies. Do you feel that they are constructive and useful as a means of motivating employees and providing a strong strategic direction? Why? Why not? ( Note: Annual reports, along with the Internet, may be good sources of information.) I think that there are lot of companies today that have mission statements that only apply to one part of their company. Example: "Google’s mission is to organize the world’s information and make it universally accessible and useful." This covers the major part of what google is all about, but how is this related to them jumping into the robotics, or unmanned vehicle industry?
Not all companies are like this. Kroger's "Being the Leader With Values" is broad enough to cover all their branches of the company. So if they have no relation to your work, I would say no they don't, but If they do as for the part of Google that work in the tech department it might. I would also say it depends on the type of person. Example of this is imagine if you were going to a college, and they had the most amazing football team. Just because they are amazing doesn't mean they will inspire all the student. Some will have no interest, and carry on with their normal day as if the football team doesn't even exist. I would say that is true with the company statements. Some people are more focused, and interested on the parts of life that directly affect them. Which is why I think if you are wanting to motivate your employees you should demonstrate, and talk to them directly about the vision, and goals you have for the company.
I'm not saying that a CEO of a company needs to meet with every employee, but if they were to

inspire the person below them it would trickle down hopefully everyone would be doing the same thing of inspiring the ones below them. Most companies I've been to hand you a stack of paper, and say read this it's what we are about then walk away. That isn't inspiring no matter how well written it is.