MBA concepts strategic management wheenlen 2012 p2

Strategy Formulation CHAPTER strategy formulation: situation analysis an Business Strategy Midamar Corporation is a family-owned company in Cedar Rapids, Iowa, that has carved out a growing niche for itself in the world food industry: supplying food prepared according to strict religious standards The company specializes in halal foods, which are produced and processed according to Islamic law for sale to Muslims Why did it focus on this one type of food? According to owner-founder Bill Aossey, "It's a big world, and you can only specialize in so many places." Although halal foods are not as widely known as kosher foods (processed according to Judaic law), their market is growing along with Islam, the world's fastest-growing religion Midamar purchases halal-certified meat from Midwestern companies certified to conduct halal processing Certification requires practicing Muslims schooled in halal processing to slaughter the livestock and to oversee meat and poultry processing Aossey is a practicing Muslim who did not imagine such a vast market when he founded his business in 1974 "People thought it would be a passing fad," remarked Aossey The company has grown to the point where it now exports halal-certified beef, lamb, and poultry to hotels, restaurants, and distributors in 30 countries throughout Asia, Africa, Europe, and North America Its customers include McDonald's, Pizza Hut, and KFC McDonald's, for example, uses Midamar's turkey strips as a bacon-alternative in a breakfast product in Singapore Midamar is successful because its chief executive formulated a strategy designed to give it an advantage in a very competitive industry It is an example of a differentiation focus competitive strategy in which a company focuses on a particular target market to provide a differentiated product or service This strategy is one of the business competitive strategies discussed in this chapter Learning Objectives After reading this chapter, you should be able to: s Organize environmental and organizational information using SWOT analysis and a SFAS matrix 23 s List the competitive tactics that would accompany competitive strategies s Identify the basic types of strategic alliances Generate strategic options by using the TOWS matrix s Understand the competitive and cooperative strategies available to corporations Environmental Scanning: Strategy Formulation: Strategy Implementation: Evaluation and Control: Gathering Information Developing Long-range Plans Putting Strategy into Action Monitoring Performance External: Mission Opportunities and Threats Objectives Natural Environment Strategies Resources and climate Policies Societal Environment Programs General forces Activities needed to accomplish a plan Task Environment Industry analysis Budgets Cost of the programs Procedures Sequence of steps needed to the jab Internal: Strengths and Weaknesses Performance Actual results Structure: Chain of command Culture: Beliefs, expectations, values Resources: Assets, skills, competencies, knowledge V A V V V Feedback/Learning: Make corrections as needed _az _ilareass wwwwoffssisins—ass .`bn 21r,c, MIMINO11•11111•16 199 200 PART Strategy Formulation 6.1 Situational Analysis: SWOT Analysis Strategy formulation, often referred to as strategic planning or long-range planning, is concerned with developing a corporation's mission, objectives, strategies, and policies It begins with situation analysis: the process of finding a strategic fit between external opportunities and internal strengths while working around external threats and internal weaknesses As shown in the Strategic Decision-Making Process in Figure 1-5, step 5(a) is analyzing strategic factors in light of the current situation using SWOT analysis SWOT is an acronym used to describe the particular Strengths, Weaknesses, Opportunities, and Threats that are strategic factors for a specific company SWOT analysis should not only result in the identification of a corporation's distinctive competencies—the particular capabilities and resources that a firm possesses and the superior way in which they are used—but also in the identification of opportunities that the firm is not currently able to take advantage of due to a lack of appropriate resources Over the years, SWOT analysis has proven to be the most enduring analytical technique used in strategic management For example, in a 2007 McKinsey & Company global survey of 2,700 executives, 82% of the executives stated that the most relevant activities for strategy formulation were evaluating the strengths and weaknesses of the organization and identifying top environmental trends affecting business unit performance over the next three to five years A 2005 survey of competitive intelligence professionals found that SWOT analysis was used by 82.7% of the respondents, the second most frequently used technique, trailing only competitor analysis It can be said that the essence of strategy is opportunity divided by capacity An opportunity by itself has no real value unless a company has the capacity (i.e., resources) to take advantage of that opportunity This approach, however, considers only opportunities and strengths when considering alternative strategies By itself, a distinctive competency in a key resource or capability is no guarantee of competitive advantage Weaknesses in other resource areas can prevent a strategy from being successful SWOT can thus be used to take a broader view of strategy through the formula SA = 0/(S – W) that is, (Strategic Alternative equals Opportunity divided by Strengths minus Weaknesses) This reflects an important issue strategic managers face: Should we invest more in our strengths to make them even stronger (a distinctive competence) or should we invest in our weaknesses to at least make them competitive? SWOT analysis, by itself, is not a panacea Some of the primary criticisms of SWOT analysis are: et It generates lengthy lists is It uses no weights to reflect priorities si It uses ambiguous words and phrases is The same factor can be placed in two categories (e.g., a strength may also be a weakness) n There is no obligation to verify opinions with data or analysis ei It requires only a single level of analysis is There is no logical link to strategy implementation GENERATING A STRATEGIC FACTORS ANALYSIS SUMMARY (SFAS) MATRIX The EFAS and LEAS Tables plus the SFAS Matrix have been developed to deal with the criticisms of SWOT analysis When used together, they are a powerful analytical set of tools for strategic analysis The SFAS (Strategic Factors Analysis Summary) Matrix summarizes an organization's strategic factors by combining the external factors from the EFAS Table with CHAPTER Strategy Formulation: Situation Analysis and Business Strategy the internal factors from the IFAS Table The EFAS and WAS examples given of Maytag Corporation (as it was in 1995) in Tables 4-5 and 5-2 list a total of 20 internal and external factors These are too many factors for most people to use in strategy formulation The SFAS Matrix requires a strategic decision maker to condense these strengths, weaknesses, opportunities, and threats into fewer than 10 strategic factors This is done by reviewing and revising the weight given each factor The revised weights reflect the priority of each factor as a determinant of the company's future success The highest-weighted EFAS and WAS factors should appear in the SFAS Matrix As shown in Figure 6-1, you can create an SFAS Matrix by following these steps: In Column (Strategic Factors), list the most important EFAS and WAS items After each factor, indicate whether it is a Strength (S), Weakness (W), an Opportunity (0), or a Threat (T) In Column (Weight), assign weights for all of the internal and external strategic factors As with the EFAS and IFAS Tables presented earlier, the weight column must total 1.00 This means that the weights calculated earlier for EFAS and WAS will probably have to be adjusted In Column (Rating), assign a rating of how the company's management is responding to each of the strategic factors These ratings will probably (but not always) be the same as those listed in the EFAS and WAS Tables In Column (Weighted Score), multiply the weight in Column for each factor by its rating in Column to obtain the factor's rated score In Column (Duration), depicted in Figure 6-1, indicate short-term (less than one year), intermediate-term (one to three years), or long-term (three years and beyond) In Column (Comments), repeat or revise your comments for each strategic factor from the previous EFAS and WAS Tables The total weighted score for the average firm in an industry is always 3.0 The resulting SFAS Matrix is a listing of the firm's external and internal strategic factors in one table The example given in Figure 6-1 is for Maytag Corporation in 1995, before the firm sold its European and Australian operations and it was acquired by Whirlpool The SFAS Matrix includes only the most important factors gathered from environmental scanning and thus provides information that is essential for strategy formulation The use of EFAS and WAS Tables together with the SFAS Matrix deals with some of the criticisms of SWOT analysis For example, the use of the SFAS Matrix reduces the list of factors to a manageable number, puts weights on each factor, and allows one factor to be listed as both a strength and a weakness (or as an opportunity and a threat) FINDING A PROPITIOUS NICHE One desired outcome of analyzing strategic factors is identifying a niche where an organization can use its core competencies to take advantage of a particular market opportunity A niche is a need in the marketplace that is currently unsatisfied The goal is to find a propitious niche—an extremely favorable niche—that is so well suited to the firm's internal and external environment that other corporations are not likely to challenge or dislodge it A niche is propitious to the extent that it currently is just large enough for one firm to satisfy its demand After a firm has found and filled that niche, it is not worth a potential competitor's time or money to also go after the same niche Such a niche may also be called a strategic sweet spot PART Strategy Formulation FIGURE 6-1 Strategic Factor Analysis Summary (SFAS) Matrix Internal Strategic Factors Weight Weighted Score Rating Strengths $1: tiO.10167 Mi g S2 Experienced top management S3 Vertical integration S4 Employee relations Comments • Quality:4y to success Know appliances Dedicated factories Good, but deteriorating Haer ;lathe in cleaners `Weaknesses W1 Process-oriented R&D W2 Distribution channels Slow on new products Superstores replacing small dealers High" ebi load , Hoover weak outside the " United Tingd9rii soia:;' , • Australia Investing now POSidon (111,)haf W5 Manufacturing facilities Total Scores External Strategic Factors Weight Rating Weighted Score Comments Opportunities 5i Econorruc integration' of conimunity „, hfcs favor Clu,(1 ity 10 18 Maytag.guilitj Low Maytag presence Will take time Maytag tyeakut this alinel 43 40 Well positioned Well positioned 45 • flopver weak globally Questionable c'IlbrA04413.re§ence is 5( 03 EC ,, 11 , Illk n !(-“, 1,1 , 11IL 04 Opening ol I Ki,irm ,Api a I Threats Increasing government regulations T2 Strong U.S competition T3 aril I le, trk)Iti T1 05 U 05 10 2.0 1:8 4.3 4.0 globally T4 New pi, ),1u, t rl in F5 Japapese appliance companies - _ Total Scores 1.2 1.6 n 16 3.15 *The most important external and internal factors are identified in the EFAS and EFAS tables as shown here by shading these factors CHAPTER Strategy Formulation: Situation Analysis and Business Strategy important opportunities/threats from EFAS, Table 4-5 and the most important strengths and weaknesses from LFAS, Table 5-2) Weight Rating Weighted Score 10 5.0 50 X Quality key to success 10 10 15 2.8 2.0 2.2 28 10 33 Name recognition High debt X Only in N.A., U.K., and Australia 10 10 10 15 4.1 5.0 1.8 3.0 41 50 18 45 X Acquisition of Hoover Maytag quality Weak in this channel Dominate industry 10 1.6 16 X Asian presence Strategic Factors (Select the most Total Scores 1.00 ao z 01 Economic integration of European Community (0) 02 Demographics favor quality (0) 05 Trend to super stores (0 + T) T3 Whirlpool and Electrolux (T) T5 Japanese appliance companies (T) Comments X XX Si Quality Maytag culture (S) S5 Hoover's international orientation (S) W3 Financial position (W) W4 Global positioning (W) Duration c/)=Og 3.01 Notes: List each of the most important factors developed in your 1FAS and EFAS Tables in Column Weight each factor from 1.0 (Most Important) to 0.0 (Not Important) in Column based on that factor's probable impact on the company's strategic position The total weights must sum to 1.00 Rate each factor from 5.0 (Outstanding) to 1.0 (Poor) in Column based on the company's response to that factor Multiply each factor's weight times its rating to obtain each factor's weighted score in Column For duration in Column 5, check appropriate column (short term-less than year; intermediate-1 to years; long term-over years) Use Column (comments) for rationale used for each factor SOURCE: T.L Wheelen, J.D Hunger, "Strategic Factor Analysis Summary (SFAS)." Copyright © 1987, 1988, 1989, 1990, 1991, 1992, 1993, 1994, 1995, 1996 and 2005 by T.L Wheelen Copyright © 1997 and 2005 by Wheelen and Associates Reprinted by permission (see Figure 6-2)-where a company is able to satisfy customers' needs in a way that rivals cannot, given the context in which it operates.? Finding such a niche or sweet spot is not always easy A firm's management must be always looking for a strategic window-that is, a unique market opportunity that is available only for a particular time The first firm through a strategic window can occupy a propitious niche and discourage competition (if the firm has the required internal strengths) One company that successfully found a propitious niche was Frank J Zamboni & Company, the manufacturer of the machines that smooth the ice at ice skating rinks Frank Zamboni invented the PART Strategy Formulation FIGURE 6-2 The Strategic Sweet Spot The Strategic Sweet Spot The strategic sweet spot of a company is where it meets customers' needs in a way that rivals can't, given the context in which it competes CONTEXT (technology, industry, demographics, regulation, and so on) SOURCE: D J Collis and M G Rukstad, "Can You Say What Your Strategy Is?" Reprinted by permission of Harvard Business Review 'The Strategic Sweet Spot' from "Can You Say What Strategy is?" by D J Collis & M G Rukstad April 2008 Copyright © 2008 by the Harvard Business School Publishing Corporation All rights reserved unique tractor-like machine in 1949 and no one has found a substitute for what it does Before the machine was invented, people had to clean and scrape the ice by hand to prepare the surface for skating Now hockey fans look forward to intermissions just to watch "the Zamboni" slowly drive up and down the ice rink, turning rough, scraped ice into a smooth mirror surface—almost like magic So long as Zamboni's company was able to produce the machines in the quantity and quality desired, at a reasonable price, it was not worth another company's while to go after Frank Zamboni & Company's propitious niche As a niche grows, so can a company within that niche—by increasing its operations' capacity or through alliances with larger firms The key is to identify a market opportunity in which the first firm to reach that market segment can obtain and keep dominant market share For example, Church & Dwight was the first company in the United States to successfully market sodium bicarbonate for use in cooking Its Ann & Hammer brand baking soda is still found in 95% of all U.S households The propitious niche concept is crucial to the software industry Small initial demand in emerging markets allows new entrepreneurial ventures to go after niches too small to be noticed by established companies When Microsoft developed its first disk operating system (DOS) in 1980 for IBM's personal computers, for example, the demand for such open systems software was very small—a small niche for a then very small Microsoft The company was able to fill that niche and to successfully grow with it Niches can also change—sometimes faster than a firm can adapt to that change A company's management may discover in their situation analysis that they need to invest heavily in the firm's capabilities to keep them competitively strong in a changing niche South African CHAPTER GLOBAL Strategy Formulation: Situation Analysis and Business Strategy 205 issue SAB DEFENDS ITS PROPITIOUS NICHE Out of 50 beers drunk by South Africans, 49 are brewed by South African Breweries (SAB) Founded more than a century ago, SAB controlled most of the local beer market by 1950 with brands such as Castle and Lion When the government repealed the ban on the sale of alcohol to blacks in the 1960s, SAB and other brewers competed for the rapidly growing market SAB fought successfully to retain its dominance of the market With the end of apartheid, foreign brewers have been tempted to break SAB's near-monopoly but have been deterred by the entry barriers SAB has erected: Entry Barrier #1: Every year for the past two decades SAB has reduced its prices The "real" (adjusted for inflation) price of its beer is now half what it was during the 1970s SAB has been able to achieve this through a continuous emphasis on productivity improvements— boosting production while cutting the workforce almost in half Keeping prices low has been key to SAB's avoiding charges of abusing its monopoly Entry Barrier #2: In South Africa's poor and rural areas, roads are rough, and electricity is undependable SAB has long experience in transporting crates to remote villages along bad roads and making sure that distributors have refrigerators (and electricity generators if needed) Many of its distributors are former employees who have been helped by the company to start their own trucking businesses Entry Barrier #3: Most of the beer sold in South Africa is sold through unlicensed pubs called shebeens—most of which date back to apartheid, when blacks were not allowed licenses Although the current government of South Africa would be pleased to grant pub licenses to blacks, the shebeen owners don't want them They enjoy not paying any taxes SAB cannot sell directly to the shebeens, but it does so indirectly through wholesalers The government, in turn, ignores the situation, preferring that people drink SAB beer than potentially deadly moonshine To break into South Africa, a new entrant would have to build large breweries and a substantial distribution network SAB would, in turn, probably reduce its prices still further to defend its market The difficulties of operating in South Africa are too great, the market is growing too slowly, and (given SAB's low cost position) the likely profit margin is too low to justify entering the market Some foreign brewers, such as Heineken, would rather use SAB to distribute their products throughout South Africa With its home market secure, SAB purchased Miller Brewing to secure a strong presence in North America SOURCE: Summarized from "Big Lion, Small Cage," The Economist (August 12, 2000), p 56, and other sources Breweries (SAB), for example, took this approach when management realized that the only way to keep competitors out of its market was to continuously invest in increased productivity and infrastructure in order to keep its prices very low See the Global Issue feature to see how SAB was able to successfully defend its market niche during significant changes in its environment 6.2 Review of Mission and Objectives A reexamination of an organization's current mission and objectives must be made before alternative strategies can be generated and evaluated Even when formulating strategy, decision makers tend to concentrate on the alternatives—the action possibilities—rather than on a mission to be fulfilled and objectives to be achieved This tendency is so attractive because it is much easier to deal with alternative courses of action that exist right here and now than to really think about what you want to accomplish in the future The end result is that we often choose strategies that set our objectives for us rather than having our choices incorporate clear objectives and a mission statement PART Strategy Formulation Problems in performance can derive from an inappropriate statement of mission, which may be too narrow or too broad If the mission does not provide a common thread (a unifying theme) for a corporation's businesses, managers may be unclear about where the company is heading Objectives and strategies might be in conflict with each other Divisions might be competing against one another rather than against outside competition—to the detriment of the corporation as a whole A company's objectives can also be inappropriately stated They can either focus too much on short-term operational goals or be so general that they provide little real guidance There may be a gap between planned and achieved objectives When such a gap occurs, either the strategies have to be changed to improve performance or the objectives need to be adjusted downward to be more realistic Consequently, objectives should be constantly reviewed to ensure their usefulness This is what happened at Boeing when management decided to change its primary objective from being the largest in the industry to being the most profitable This had a significant effect on its strategies and policies Following its new objective, the company cancelled its policy of competing with Airbus on price and abandoned its commitment to maintaining a manufacturing capacity that could produce more than half a peak year's demand for airplanes c6.3 Generating Alternative Strategies by Using a TOWS Matrix Thus far we have discussed how a firm uses SWOT analysis to assess its situation SWOT can also be used to generate a number of possible alternative strategies The TOWS Matrix (TOWS is just another way of saying SWOT) illustrates how the external opportunities and threats facing a particular corporation can be matched with that company's internal strengths and weaknesses to result in four sets of possible strategic alternatives (See Figure 6-3.) This is a good way to use brainstorming to create alternative strategies that might not otherwise be considered It forces strategic managers to create various kinds of growth as well as retrenchment strategies It can be used to generate corporate as well as business strategies FIGURE 6-3 TOWS Matrix • INTERNAL Strengths (S) FACTORS List – 10 internal (IFAS) strengths here EXTERNAL FACTORS (EFAS) _ Opportunities (0) SO Strategies List - 10 external Generate'strategies here opportunities here that use' strengths to take advantage of opportunities Weaknesses (W) List -10 internal weaknesses here WO Strategies Generate strategieS her? , that take advantage of opportunities by overcoming weaknesses Threats (T) ST Strategies WT Strategies List - 10 external threats here Gerierate-etiategies here -; that use strengths to 'avoid threats Generate strategies here that minimize weaknesses and aVoid threats • • ".' • ' SOURCE: Reprinted from Long-Range Planning, Vol 15, No 2, 1982, Weihrich "The TOWS Matrix—A Tool For Situational Analysis," p 60 Copyright © 1982 with permission of Elsevier GLOSSARY and services to customers, who typically pay for the costs and expenses of providing the product or service plus a profit Program A statement of the activities or steps needed to accomplish a single-use plan in strategy implementation Propitious niche A portion of a market that is so well suited to a firm's internal and external environment that other corporations are not likely to challenge or dislodge it Public governmental unit or agency A kind of not-for-profit organization that is established by government or governmental agencies (such as welfare departments, prisons, and state universities) Public or collective good Goods that are freely available to all in a society Pull strategy A marketing strategy in which advertising pulls the products through the distribution channels Punctuated equilibrium A point at which a corporation makes a major change in its strategy after evolving slowly through a long period of stability Purchasing power parity (PPP) A measure of the cost, in dollars, of the U.S.-produced equivalent volume of goods that another nation's economy produces Purchasing strategy A functional strategy that deals with obtaining the raw materials, parts, and supplies needed to perform the operations functions Push strategy A marketing strategy in which a large amount of money is spent on trade promotion in order to gain or hold shelf space in retail outlets Quality of work life A concept that emphasizes improving the human dimension of work to improve employee satisfaction and union relations Quasi-integration A type of vertical growth/ integration in which a company does not make any of its key supplies but purchases most of its requirements from outside suppliers that are under its partial control Question marks New products that have potential for success and need a lot of cash for development RFID A technology in which radio frequency identification tags containing product information is used to track goods through inventory and distribution channels R&D intensity A company's spending on research and development as a percentage of sales revenue R&D mix The balance of basic, product, and process research and development R&D strategy A functional strategy that deals with product and process innovation Ratio analysis The calculation of ratios from data in financial statements to identify possible strengths or weaknesses Real options approach An approach to new project investment when the future is highly uncertain Red flag An indication of a serious underlying problem Red tape crisis A crisis that occurs when a corporation has grown too large and complex to be managed through formal programs Reengineering The radical redesign of business processes to achieve major gains in cost, service, or time Regional industry An industry in which multinational corporations primarily coordinate their activities within specific geographic areas of the world Relationship-based governance A government system perceived to be less transparent and have a higher degree of corruption Repatriation of profits The transfer of profits from a foreign subsidiary to a corporation's headquarters Replicability The ability of competitors to duplicate resources and imitate another firm's success Resources A company's physical, human, and organizational assets that serve as the building blocks of a corporation Responsibility center A unit that is isolated so that it can be evaluated separately from the rest of the corporation Retired executive directors Past leaders of a company kept on the board of directors after leaving the company Retrenchment strategy Corporate strategies to reduce a company's level of activities and to return it to profitability Return on equity (ROE) A measure of performance that is calculated by dividing net income by total equity Return on investment (ROI) A measure of performance that is calculated by dividing net income before taxes by total assets Revenue center A responsibility center in which production, usually in terms of unit or dollar sales, is measured without consideration of resource costs Reverse engineering Taking apart a competitor's product in order to find out how it works Reverse stock split A stock split in which an investoso's shares are reduced for the same total amount of money Risk A measure of the probability that one strategy will be effective, the amount of assets the corporation must allocate to that strategy, and the length of time the assets will be unavailable Rule-based governance A governance system based on clearly stated rules and procedures Rules of thumb Approximations based not on research, but on years of practical experience Sarbanes-Oxley Act Legislation passed by the U.S Congress in 2002 to promote and formalize greater board independence and oversight Scenario box A tool for developing corporate scenarios in which historical data are used to make projections for generating pro forma financial statements Scenario writing A forecasting technique in which focused descriptions of different likely futures are presented in a narrative fashion Secondary stakeholders Lower-priority groups that affect or are affected by the achievement of a firm's objectives Sell-out strategy A retrenchment option used when a company has a weak competitive position resulting in poor performance Separation A method of managing the culture of an acquired firm in which the two companies are structurally divided, without cultural exchange SFAS (Strategic Factors Analysis Summary) matrix A chart that summarizes an organization's strategic factors by combining the external factors from an EFAS table with the internal factors from an WAS table Shareholder value The present value of the anticipated future stream of cash flows from a business plus the value of the company if it were liquidated Short-term orientation The tendency of managers to consider only current tactical or operational issues and ignore strategic ones Simple structure A structure for new entrepreneurial firms in which the employees tend to be generalists and jacks-of-all-trades Six Sigma A statistically-based program developed to identify and improve a poorly performing process Skim pricing A marketing strategy in which a company charges a high price while a product is novel and competitors are few Small-business firm An independently owned and operated business that is not dominant in its field and that does not engage in innovative practices SO, ST, WO, WT strategies A series of possible business approaches based on combinations of opportunities, threats, strengths and weaknesses Social capital The goodwill of key stakeholders, which can be used for competitive advantage Social entrepreneurship A business in which a not-for-profit organization starts a new venture to achieve social goals Social responsibility The ethical and discretionary responsibilities a corporation owes its stakeholders Societal environment Economic, technological, political-legal, and sociocultural environmental forces that not directly touch on GLOSSARY the short-run activities of an organization but influence its long-run decisions Sole sourcing Relying on only one supplier for a particular part Sources of innovation Drucker's proposed seven sources of new ideas that should be monitored by those interested in starting entrepreneurial ventures Sponsor A department manager who recognizes the value of a new idea, helps obtain funding to develop the innovation, and facilitates the implementation of the innovation Stability strategy Corporate strategies to make no change to the company's current direction or activities Staffing Human resource management priorities and use of personnel Stages of corporate development A pattern of structural development that corporations follow as they grow and expand Stages of international development The stages through which international corporations evolve in their relationships with widely dispersed geographic markets and the manner in which they structure their operations and programs Stages of new product development The stages of getting a new innovation into the marketplace Stage-gate process A method of managing new product development to increase the likelihood of launching new products quickly and successfully The process is a series of steps to move products through the six stages of new product development Staggered board A board on which directors serve terms of more than one year so that only a portion of the board of directors stands for election each year Stakeholder analysis The identification and evaluation of corporate stakeholders Stakeholder measure A method of keeping track of stakeholder concerns Stakeholder priority matrix A chart that categorizes stakeholders in terms of their interest in a corporation's activities and their relative power to influence the corporation's activities Stall point A point at which a company's growth in sales and profits suddenly stops and becomes negative Standard cost center A responsibility center that is primarily used to evaluate the performance of manufacturing facilities Standard operating procedures Plans that detail the various activities that must be carried out to complete a corporation's programs Star Market leader that is able to generate enough cash to maintain its high market share Statistical modeling A quantitative technique that attempts to discover causal or explanatory factors that link two or more time series together STEEP analysis An approach to scanning the societal environment that examines sociocultural, technological, economic, ecological, and political-legal forces Also called PESTEL analysis Steering control Measures of variables that influence future profitability Stewardship theory A theory proposing that executives tend to be more motivated to act in the best interests of the corporation than in their own self-interests Strategic alliance A partnership of two or more corporations or business units to achieve strategically significant objectives that are mutually beneficial Strategic audit A checklist of questions by area or issue that enables a systematic analysis of various corporate functions and activities It's a type a management audit Strategic audit worksheet A tool used to analyze a case Strategic business unit (SBU) A division or group of divisions composed of independent product-market segments that are given primary authority for the management of their own functions Strategic choice The evaluation of strategies and selection of the best alternative Strategic choice perspective A theory that proposes that organizations adapt to a changing environment and have the opportunity and power to reshape their environment Strategic decision-making process An eight-step process that improves strategic decision making Strategic decisions Decisions that deal with the long-run future of an entire organization and are rare, consequential, and directive Strategic factors External and internal factors that determine the future of a corporation Strategic flexibility The ability to shift from one dominant strategy to another Strategic group A set of business units or firms that pursue similar strategies and have similar resources Strategic inflection point The period in an organization's life in which a major change takes place in its environment and creates a new basis for competitive advantage Strategic management A set of managerial decisions and actions that determine the longrun performance of a corporation Strategic management model A rational, prescriptive planning model of the strategic management process including environmental scanning, strategy formulation, strategy implementation, and evaluation and control Strategic myopia The willingness to reject unfamiliar as well as negative information Strategic piggybacking The development of a new activity for a not-for-profit organization that would generate the funds needed to make up the difference between revenues and expenses Strategic planning staff A group of people charged with supporting both top management and business units in the strategic planning process Strategic R&D alliance A coalition through which a firm coordinates its research and development with another firm(s) to offset the huge costs of developing new technology Strategic rollup A means of consolidating a fragmented industry in which an entrepreneur acquires hundreds of owner-operated small businesses resulting in a large firm with economies of scale Strategic sweet spot A market niche in which a company is able to satisfy customers' needs in a way that competitors cannot Strategic type A category of firms based on a common strategic orientation and a combination of structure, culture, and processes that are consistent with that strategy Strategic vision A description of what the company is capable of becoming Strategic window A unique market opportunity that is available only for a particular time Strategic-funds method An evaluation method that encourages executives to look at development expenses as being different from expenses required for current operations Strategies to avoid Strategies sometimes followed by managers who have made a poor analysis or lack creativity Strategy A comprehensive plan that states how a corporation will achieve its mission and objectives Strategy formulation Development of longrange plans for the effective management of environmental opportunities and threats in light of corporate strengths and weaknesses Strategy implementation A process by which strategies and policies are put into action through the development of programs, budgets, and procedures Strategy-culture compatibility The match between existing corporate culture and a new strategy to be implemented Structure follows strategy The process through which changes in corporate strategy normally lead to changes in organizational structure Stuck in the middle A situation in which a company or business unit has not achieved a generic competitive strategy and has no competitive advantage Suboptimization A phenomenon in which a unit optimizes its goal accomplishment to the detriment of the organization as a whole GLOSSARY Substages of small business development A set of five levels through which new ventures often develop Substitute products Products that appear to be different but can satisfy the same need as other products Supply-chain management The formation of networks for sourcing raw materials, manufacturing products or creating services, storing and distributing goods, and delivering goods or services to customers and consumers Support activity An activity that ensures that primary- value-chain activities operate effectively and efficiently SWOT analysis Identification of strengths, weaknesses, opportunities, and threats that may be strategic factors for a specific company Synergy A concept that states that the whole is greater than the sum of its parts; that two units will achieve more together than they could separately Tacit knowledge Knowledge that is not easily communicated because it is deeply rooted in employee experience or in a corporation's culture Tactic A short-term operating plan detailing how a strategy is to be implemented Takeover A hostile acquisition in which one firm purchases a majority interest in another firm's stock Taper integration A type of vertical integration in which a firm internally produces less than half of its own requirements and buys the rest from outside suppliers Task environment The part of the business environment that includes the elements or groups that directly affect the corporation and, in turn, are affected by it Technological competence A corporation's proficiency in managing research personnel and integrating their innovations into its dayto-day operations Technological discontinuity The displacement of one technology by another Technological follower A company that imitates the products of competitors Technological leader A company that pioneers an innovation Technology sourcing A make-or-buy decision that can be important in a firm's R&D strategy Technology transfer The process of taking a new technology from the laboratory to the marketplace Time to market The time from inception to profitability of a new product Timing tactics Tactics that determines when a business will enter a market with a new product Tipping point The point at which a slowly changing situation goes through a massive, rapid change Top management responsibilities Leadership tasks that involve getting things accomplished through and with others in order to meet the corporate objectives Total Quality Management (TQM) An operational philosophy that is committed to customer satisfaction and continuous improvement TOWS matrix A matrix that illustrates how external opportunities and threats facing a particular company can be matched with that company's internal strengths and weaknesses to result in four sets of strategic alternatives Transaction cost economics A theory that proposes that vertical integration is more efficient than contracting for goods and services in the marketplace when the transaction costs of buying goods on the open market become too great Transfer price A practice in which one unit can charge a transfer price for each product it sells to a different unit within a company Transferability The ability of competitors to gather the resources and capabilities necessary to support a competitive challenge Transformational leader A leader who causes change and movement in an organization by providing a strategic vision Transparent The speed with which other firms can understand the relationship of resources and capabilities supporting a successful firm's strategy Trends in governance Current developments in corporate governance Trigger point The point at which a country has developed economically so that demand for a particular product or service is increasing rapidly Triggering event Something that acts as a stimulus for a change in strategy Turnaround specialist A manager who is brought into a weak company to salvage that company in a relatively attractive industry Turnaround strategy A plan that emphasizes the improvement of operational efficiency when a corporation's problems are pervasive but not yet critical Turnkey operation Contracts for the construction of operating facilities in exchange for a fee Turnover A term used by European firms to refer to sales revenue It also refers to the amount of time needed to sell inventory Uncertainty avoidance (UA) The extent to which a society feels threatened by uncertain and ambiguous situations Union of South American Nations An organization formed in 2008 to unite Mercosur and the Andean Community Utilitarian approach A theory that proposes that actions and plans should be judged by their consequences Value chain A linked set of value-creating activities that begins with basic raw materials coming from suppliers and ends with distributors getting the final goods into the hands of the ultimate consumer Value-chain partnership A strategic alliance in which one company or unit forms a long-term arrangement with a key supplier or distributor for mutual advantage Value disciplines An approach to evaluating a competitor in terms of product leadership, operational excellence, and customer intimacy Vertical growth A corporate growth strategy in which a firm takes over a function previously provided by a supplier or distributor Vertical integration The degree to which a firm operates in multiple locations on an industry's value chain from extracting raw materials to retailing Virtual organization An organizational structure that is composed of a series of project groups or collaborations linked by changing nonhierarchical., cobweb-like networks Virtual team A group of geographically and/or organizationally dispersed coworkers that are assembled using a combination of telecommunications and information technologies to accomplish an organizational task Vision A view of what management thinks an organization should become VRIO framework Barney's proposed analysis to evaluate a firm's key resources in terms of value, rareness, imitability, and organization Web 2.0 A term used to describe the evolution of the Internet into wilds, blogs, RSS, social networks, podcasts, and mash-ups Weighted-factor method A method that is appropriate for measuring and rewarding the performance of top SBU managers and group-level executives when performance factors and their importance vary from one SBU to another Whistle-blower An individual who reports to authorities incidents of questionable organizational practices World Trade Organization A forum for governments to negotiate trade agreements and settle trade disputes Z-value A formula that combines five ratios by weighting them according to their importance to a corporation's financial strength to predict the likelihood of bankruptcy NOTE: This glossary contains terms used in the twelve chapters of this textbook plus the three additional chapters provided on the publisher's Web site to buyers of this book NAME INDEX 3Com, 264 3M, 45, 71, 149, 294 314, 318, 357, 379 60 Minutes, 370 A&W, 222 A C Nielsen Co., 145 Abbott Laboratories, 336 Accenture, 384 Ace Hardware, 270 Addidas, 135 Adelphia Communications, 79 Admiral, 339 Adobe, 378 Aerospatiale, 221 AES, 394 AFL-CIO, 82 AIM Global, 372 Airbus Industrie, 135, 194, 221, 238, 278 Ajax Continental, 340 Alamo, 210 Albertson's, 212 Alcatel-Alsthorn NV, 174 Alcoa, 346 Aldi, 210 Alexander, M., 250, 251 All-China Federation of Trade Unions, 129 Allen, J., 228 Allied Corp 231 Allied Signal, 232, 314, 330 Allport-Vemon-Lindzey Study of Values, 104 Altman, E.I., 395 Amazon.com , 50, 85, 167, 254 America West, 235 America's Most Admired Companies, 379 American Airlines, 32, 43, 356 American Customer Satisfaction Index (ACSI), 68, 356 American Cyanamid, 318, 319 American Express, 264, 379 American Family Association (AFA), 102 American Hospital Supply (AHS), 186 American Management Assoc., 272, 357 American Productivity & Quality Center (APQC), 368 American Society for Industrial , 145 American Society of Training and , 327 Americans for Balanced Energy Choices, 346 Amgen, 49 Amnesty International, 83 Amoco, 169 Andean Community, 32, 33 Anheuser-Busch, 77, 167, 177, 218, 220, 236, 237, 269, 367 Aossey, B., 198 Apple, 84, 133, 136, 163, 211, 218, 254, 263, 294, 307, 367, 371, 379 Applebee's, 328 Apria Healthcare, 71 Arcelor, 302 Archer Daniels Midland (ADM), 219 Arctic Cat 303, 304 Arctic Council, 120 Aristotle, 281 Arm & Hammer, 204, 262 Arthur D Little Inc., 139 Asea Brown Boveri (ABB), 314, 318 Ashridge Strategic Management Centre, 42 Association of Southeast Asian Nations (ASEAN), 32, 33, 137 Astra Zenica, 212 AT&T, 264, 331, 340 Automotive Resources, 370 Avis, 324 Avnet, Inc., 147 Avon Co., 51, 145, 162, 271 Baan, 186, 371 Baby Fresh Organic Baby Foods, 311 Badaracco, J., 110 Bain & Co., 31, 241, 272, 330, 364, 368 Baja' Auto, 166 Baldor Electric Company, 266 Baldwin Locomotive, 122 Baldwin-United, 308 Ballmer, S., 84 Banadex, 114 Banbury, C., 320 Banerjee, P., 385 Bank of America, 35 Bank of Montreal, 71 Bank One, 294 Bankers Trust of New York, 330, 333 Banking Act of 1933, 76 Barclays, 394 Barnevik, P., 174 Barney, J B., 219 Baxter Healthcare, 158 Bechtel Group Inc., 51 Beijing Olympics, 46 Bell South, 264, 365 Ben & Jerry's Ice Cream, 99 Benetton, 311 Bennigan's Grill & Tavern, 244 Berkshire Hathaway, 239, 379 Berle, A A., 74 Bert, A., 296 Best Buy, 143, 168, 233, 294 Best Western, 71 Bezos, J., 50, 85 Bharti Enterprises, 237 Bharti-Mart, 237 Bice, A., 103 Big Idea Group, 266 Bill of Rights, 109 Birkinshaw, J M., 252 Bisquick, 249 Black & Decker, 222 Black, J S., 334 Blank, A., 66 Bloom, R., 184 BMW, 45, 173, 176, 182, 211, 237, 379 Body Shop, 83, 84 Boeing Company, 45, 135, 183, 194, 238, 272, 340 Bombardier, 238, 239, 312 Borders, 254 Bosch Appliances, 253 Bosch-Siemens, 215 Bose Corporation, 268 Boston Consulting Group, 29, 245 Boston University, 384 Boveri AG, 174 BP Amoco, 169 Brabeck-Letmathe, P., 319 Brady Bunch, 129 Branson, R., 84 Brastemp, 267 Brigham, L., 118 Bristol-Myers Squibb, 234, 330 British Aerospace, 221 British Airways, 32, 43, 149 British Petroleum (BP), 37, 169, 233, 395 Brynjolfsson, E., 298 Budweiser, 220, 236, 370 Buffet, W., 239 Burger King, 140 Bums, L., 246 Busch Gardens, 128 Business Environment Risk Index, 139 Business Roundtable Institute for Corporate Ethics, 107 Business Software Alliance, 270 Business Week, 35, 66, 87, 326 Byron, W., 96 Cadbury Cocoa Partnership, 300 Cadbury Report, 80 Cadbury Schweppes, 42, 43, 300 Cadillac, 46 CAFTA, 32 Calhoun, D., 28 Callaway, 370 Campbell, A., 42, 250, 251, 302 Canadair, 238 Canary Wharf, 394 CANENA, 369 Canon, 108, 235 Carbon Trust, 35, 364 Carbonrally.com, 124 Carrefour, 235, 237 NAME INDEX Carroll, A., 96, 97 Carroll's Foods, 232, 233 Case, 126 Casey's General Store, 282 Castaiio, C., 114 Caterpillar, 176, 189, 253, 294, 313, 346 Cavanagh, G F., 109 Celia, 267 Census of Manufacturing, 342 Center for Energy & Economic Development (CEED), 346 Center for Financial Research & Analysis (DFRA), 388 Central American Free Trade Agreement (CAFTA), 33 Certified Emissions Reducer (CER), 394 Chandler, A., 38, 303, 307 Chang, S., 318 Charan, R., 365 Charmin, 212 Checkers Restaurants, 388 Cheerios, 94, 135 Chevrolet Volt, 246 Chevron, 278 Chiquita Brands International Inc., 114 Chiscos, 370 Chouinard, Y., 211 Chow, D., 370 Christensen, C M., 180 Chrysler Corp., 76, 183, 220, 265, 268, 283, 346, 358 Chung, W., 32 Church & Dwight Co., 204, 260, 262 Circuit City, 168, 244 Cisco Systems, 45, 79, 97, 146, 232, 355, 370, 379 Citibank, 394 Citicorp, 330 Citigroup, 35 Claussen, E., 33 Clayton Act, 76 Clinton, H., 149 Clorox Company, 219, 222 Coca-Cola, 35, 42, 176, 185, 218, 269, 362, 363, 371 Colgate-Palmolive, 260, 262 Colt's Manufacturing, 308 Combined Code of Conduct, 80 Comcast, 81 Compaq, 1361 240, 384, 385 ConAgra, 281 Cone, Inc., 98 Conference Board, 98 ConocoPhillips, 34 Construcciones Aeronauticas, 221 Converse, 135 Cooper & Lybrand, 220 Cooper, C 104 Corning, Inc., 315, 327 Corporate Library, 77, 80 Cosby Show, 129 Costco Wholesale, 294 379 Craigslist, 284 Cramer, J., 47 Crane, A., 99 Credit Suisse, 394 Crest, 235 Crest Whitestrips, 251 Cromme Commission, 80 CSX Corp., 240 Cummins, Inc., 253 CVS, 294 D'Aveni, R., 37, 142, 215, 216 Daft, D., 185 Daimler-Benz Aerospace, 221, 294 DaimlerChrysler, 338 Daksh eServices Ltd., 272 Dale, K., 268 Danone, 269 Dashboard software, 356 Davis, S M., 310 Dean Foods Co., 265 Dean, H., 265 Deere and Co., 212, 298, 362 Defining Moments, 110 Degeorge, 106 Delawder, T., 357 Delay, T., 364 Dell Computer, 47, 129, 134, 136, 157, 165, 167, 187, 210, 215, 241, 268, 272, 379, 384 Dell, M., 47, 165, 241 Deloitte & Touche Consulting Group, 131 Delphi Corp., 244, 267 Delta Airlines, 235, 243, 302 Delta Small Car Program, 174 Deming, W E., 268 DHL, 224 Diligence Inc., 145 Disney, W., 167 Dixon, L., 268 Dodge Viper, 283 Doha Round, 127 Dole Food, 372 Donahoe, J., 284 Dow Chemical, 314 Dow Corning, 158 Dow Jones & Company, 99, 100 Dow Jones Sustainability Index (DJSI), 35, 100 Dr Pepper/Snapple, 43 Draghi Law of 1998, 80 Drauch, D., 246 Dreamliner, 272 Duke Energy, 346 DuPont, 87, 167, 247, 303, 304, 306, 357 Durant, W., 307 Eastern Airlines, 274, 308 Eastman Chemical Co., 365 Eastman Kodak, 122, 308, 332 Eaton Corporation, 376 eBay, 167, 284 372 Echeverria, J 35 Eckberg, J., 345 Eco-Management and Audit Regulations 83 Economic Espionage Act in 1996 146 Economist, 146 Economist Intelligence Unit, 98, 139, 221 Ecopods, 110 Eisner, M., 86 Electrolux, 75, 149, 215, 334, 395 Electronic Data Systems (EDS), 384 Eli Lilly, 149 Elion Chemical, 269 Elliot, J R., 128 Ellison, L., 231, 304, 305 Emerson Electric, 77 Encyclopaedia Britannica Inc., 50 Energy Star, 253 Enhanced Tracker, 366 Enron, 68, 69, 79, 103, 104, 106 Ensign, P.C., 252 Enterprise Rent-A-Car, 324 Environics, 34 Environmental Protection Agency, 124 Equitable Life, 70 Erhardt, W., 326 Ericsson, 235 Eskew, M., 149 Estee Lauder, 128 Ethics Resource Center, 103 European Aeronautic & Space Co (EADS), 194 European Union (EU), 32, 33, 34, 128, 137, 143, 394 Excel, 135, 275 Exxon, 45 Facebook, 186 Fairfax, 145 Fazio, L., 103 Federated Department Stores, 302 FedEx, 28, 46, 162, 186, 232, 271, 366, 372, 379 Ferari, M., 168 Fiat, 237, 238 Fiat Group, 320 Findex, 145 Finsbury Data Services, 145 Fiorina, C., 86, 384 First Boston, 264 Folgers, 222 Footprint Chronicles, 211 Forbes 100, 30 Ford Motor Co., 102, 160, 168, 169, 184, 268, 272, 298, 307, 314, 332, 357 Ford, H, 168, 232, 307 Fortune, 94, 379 Foster, R., 179 NAME INDEX Frank J Zamboni & Co., 203 Fredrickson, J., 53, 54 Freeman, K., 346 Freightliner, 211 Friedman, M., 96, 97, 98 Friedman, T., 32 Friends of the Earth, 83 Frost, T S., 139, 252 Fujitsu Ltd., 274 Fuld-Gilad-Herring Academy of Competitive Intelligence, 132 Galbraith, 169 Gap International, 108 Gartner Group, 183 Gaskell, J., 168 Gates, W., 84, 142 Gateway, 129, 136 GE Capital International Services, 272 GE Energy Financial Services, 394 Genentech, 49, 79, 378 General Agreement on Tariffs and Trade (GATT), 127 General Electric (GE), 26, 29, 30, 32, 45, 46, 51, 71, 122, 149, 162, 176, 183, 220, 235, 239, 243, 247, 251, 269, 271, 272, 282, 306, 314, 328, 330, 331, 332, 346, 363, 367, 378, 379, 394 General Foods, 172 General Mills, 94, 96, 135, 145, 249 General Motors (GM), 46, 84, 122, 166, 174, 220, 243, 246, 267, 272, 281, 284, 303, 304, 306, 307, 309, 332, 334, 335, 337, 346, 357, 363, 373, 384 George Washington University, 126 Georgetown University's Environmental Law & Policy Institute, 35 Georgia-Pacific, 270 Gerstner, L., 50, 84 Ghosn, C., 339 Gilad, 147, 157 Gillette, 50, 157, 164, 165, 166, 175, 217, 232, 302, 365 Glass, Lewis & Co., 79 Global Crossing, 69, 79 Goizueta, R., 362 Goldman Sachs Group, 35, 379 Goodyear Tire & Rubber, 184, 267* Google, 41, 81, 149, 167, 173, 379 Goold, M., 250, 251, 302 Graduate Management Admission Council, 103 Graduate Management Admission Test (GMAT), 103 Grant, R M., 51 Grantham, C., 183 Green Book, 83 Greenpeace, 83, 101 Gregersen, H B., 334 Greiner, L E., 304, 307 Gretzky, W., 151 Grey-Wheelfight 347 Group Danone, 319 Grove, A., 48, 101, 137, 278 Hambrick, D., 53, 54 Hamilton Beach, 222 Hamilton, R D., 357 Hammer, M., 313 Hardee's, 140 Harley-Davidson, 314, 333 Harper Collins, 254 Harrigan, K R., 233 Harris Interactive, 94 Harris Poll, 99 Hay Group, 379 Hayes Microcomputer Products, 309 Hayes, D., 309 HCL Technologies, 270 Head & Shoulders, 235, 370 Healthy Choice, 281 Heartland Institute, 346 Hegel, 281 Heilmeier, G., 180 Heineken, 187, 205 Herd, T., 296 Hershey Foods, 43, 332, 371 Hertz, 324 Hesse, D., 133 Hewitt Associates, 338 Hewlett, W., 384 Hewlett-Packard, 37, 86, 108, 158, 167, 173, 182, 215, 230, 235, 240, 270, 308, 357, 284, 385 Hofstede, G., 343, 344 Home Café, 222 Home Depot, 46, 66, 224, 263, 301, 309, 336, 338, 371 Homecoming Financial, 103 Honda, 163, 213, 237 Honeywell, 268 Hoover, 243 Hoover, R., 315, 327 Hoover's Online, 36, 145 Hovis, J., 147 HSBC, 394 Huggies, 217 Hurricane Katrina, 35 Hurt, M., 384 Hypercompetition, 37, 215 IBM, 32, 50, 51, 131, 136, 139, 141, 157, 166, 82, 221, 237, 247, 266, 268, 271, 274, 304, 331, 334, 378, 279, 384 ImClone, 234 Inunelt, J., 26, 332 Impacts of a Warming Arctic, 118 In Search of Excellence, 376 In the Garden, 415 InBev, 237 Indian Auto Show 160 Infrasource Services, 81 Ingersoll-Rand, 268 Innovator's Dilemma 180 Institutional Shareholder Services (ISS), 80 Intel, 45, 101, 137, 164, 176, 248, 265, 278, 363 Intercontinental Hotels, 275 Intergovernmental Panel on Climate Change (IPCC), 36 International Accounting Standards Board, 369 International Electrotechnical Commission (IEC), 369 International Energy Agency, 34 International Harvester, 308, 371 International House of Pancakes (IHOP), 328 International Monetary Fund, 125 International Organization for Standardization (ISO), 369 International Panel on Climate Change, 152 International Paper, 236 International Standards Assoc., 357 Internet Explorer, 167, 217 Interstate Bakeries, 128 Intrade.com , 149 Investor Responsibility Research Center, 81 Iowa State University, 298 ISDC, 370 Iverson, K., 352 Ivory, 176 J D Edwards, 186, 371 J P Morgan Chase & Co., 273 Jaguar, 160, 243 JetBlue, 194 Jewel, 212 Jobs, S., 84, 254, 307 John Deere, 126, 263 Johns-Manville, 308 Johnson & Johnson (J&J), 102, 108, 157, 252, 283, 379 Johnson, L., 298 Jones Surplus, 340 Jones, M., 301 Joyce, W., 31 JPMorgan Chase, 35 Jung, C., 347 Kant, I 109 Kaplan, R S., 363 KappaWest, 158 Kearney, A T., 296 Kellogg Co., 263 Kenworth, 211 KeraVision, Inc., 365 KFC, 198, 222 Kimberly Clark, 158, 217, 252, 264 King, S., 254 NAME INDEX Kinko's 232 Kirin 220 KLD Broad Market Social Index, 35 Kleenex 176 Kleiner Perkins, 76 K-Mart, 213, 308 Knight, P., 84 Kohlberg, L., 107 Korn/Ferry International, 75, 365 Koutsky, J., 298 Kraft Foods,42, 43, 319, 388 Kramer, M R., 98 Kroger, 294 Kroll, Inc., 145 Krups, 222 Kugler, R., 48 Kurtzman Group, 105 Kvinnsland, S., 345 Kyoto Protocol, 34, 394 L L Bean, 368 L'Oreal, 83 Labatt, 220 Lada, 238 Lafley, A., 266 Land, E., 307 Land Rover 160, 243 Langone, K., 66 Larsen, R., 283 Lawrence, P R., 310 Lay, K., 104 Leadership Development Center, 331 Lear, 267 Learjet, 238 Leder, M., 389 LEGO, 187 Lehman Brothers, 394 Lemon Fresh Comet, 219 Lenovo Group, 247 Levi Strauss & Co., 99, 108, 149, 294 Levinson, A., 49 Lewis, J., 340 LexisNexis, 145 Lincoln Electric, 141 Linebarger, T., 253 Linux, 266, Livingston, R., 271 Loarie, T., 365 Lockheed Martin, 158, 271 Loewen Group, 214 Logitech, 318 Long John Silver's, 222 Long Range Planning, 42 Lorange, P., 222 Lorsch, J., 81 Lovins, A., 185 Lutz, B., 84, 246, 283 MacDonald, T., 296 Macy's Department Stores, 302, 308 Mad Money, 47 Magic Chef, 44 Malik 254 Malmendier, U., 85 Management Tools and Trends, 31 Manco, Inc., 368 Marchionne, S., 320 Marcus, B., 66 Margolis, J D., 98 Market Research.com , 145 Marlboro, 370 Marriott, 270 Marsh Center for Risk Insights, 269 Mary Kay Corp., 145 Mary Poppins, 167 Maslow, A., 107 Matsushita Electric Industrial Corporation (MEI), 174 Matsushita, K., 174 Mattel, 266, 271 Marten, D., 99 MaxiShips, 271 May Company, 302 Maybelline, 128 Maytag Corp., 100, 151, 163, 189, 201, 207, 215, 221, 237, 243, 265, 339, 397, 400, 407 McCain, J., 149 McDonald's, 98, 128, 140, 176, 198, 210, 214, 270, 271, 301, 330 McDonnell Douglas, 194, 340 McKesson, 346 McKinsey & Co., 30, 32, 70, 71, 81, 98, 144, 179, 186, 200, 240, 244, 247, 280, 330, 338, 364, 399 McLeodUSA, 219 McNealy, S., 307 Mead Corporation, 71 Means, G C., 74 Medtronic, 71, 108 Mercedes Benz, 176 Mercer Delta Consulting, 80 Merck, 212 Mercosur (Mercosul), 32, 33, 136 Merrill Lynch, 372 Mesa Airlines, 235 Microsoft, 32, 44, 84, 135, 142, 145, 149, 167, 176, 204, 217, 218, 231, 266, 330, 359, 363, 371, 379 Midamar Corp., 198, 212 Miles, R E., 141, 312 Miller Brewing Co., 32, 205 Millstone, 222 Mintzberg, H., 47, 50, 283 Mission Point Capital Partners, 394 MIT, 272 Mitsubishi Motors, 338 Mittal Steel, 302 Modelo, 220 Montgomery Ward, Inc., 308, 328 Moody's, 80 Morgan Motor Car Co., 212 Morgan Stanley, 394 Morningstar, 80 Mossville Engine Center, 313 Motorola, 108, 165, 183, 235, 327 Movie Gallery, 126 MphasiS, 384 Mr Coffee, 222 Mr Donut, 262 MS-DOS, 135 Mullen, D., 372 Mulva, J., 34 Muralidharan, R., 357 Myers-Briggs, 347 MySpace, 186 NAFTA, 32, 137 Nardelli, R., 66, 301, 338 NASDAQ, 73, 79, 81 National Association of Corporate Directors, 69 National Car Rental, 324 National Nanotechnology Infrastructure Network, 266 National Research Center, 356 Nature Conservancy, 124 NCR Corp., 183, 340, 384 Nestle, 42, 175, 269, 318, 319 Netscape, 167, 217 Netsuite, 356 New Balance, 135 New York Stock Exchange, 73, 79, 81 Newman's Own, 108 Newport News Shipbuilding, 41 News Corp, 394 Nickelodeon, 212 Nike, 32, 110, 135, 211, 228, 265, 311, 330 Nissan Motor Company, 166, 237, 302, 339 Nohria, N., 31 Nokia, 176 Noorda, R., 224 Nordstrom, 173, 282, 379 North America Index, 100 Northern Telecom, 183 Northwest Airlines, 76, 235, 243, 302 Norton, D P., 363 Novartis, 49 Novell, 224 Nucor Corporation, 173, 352 NutraSweet, 136 Nutt, P., 281 O'Reilly, T., 254 Obama, B., 149 Ocean Spray, 262 Ocean Tomo, 265 Office Depot, 356 Ohio State University, 370 Olay, 235 Olive Garden, 140 Olivetti, 247 NAME INDEX Olson, M., 294, 296 Omidyar, P., 284 Open Compliance and Ethics Group, 108 Open Standards Benchmarking, 368 Oppenheimer, P., 263 Oracle Corp., 145, 186, 231, 302, 304, 306, 371 Orbitz, 81 Orion Pictures, 308 Orphagenix, 212 Owens-Coming, 371 P F Chang's, 214 Pacar Inc., 211 Pacific Gas and Electricity, 149 Packard, D., 384 Palm, 218 Pampers, 217, 235 Pan Am Building, 275 Pan American Airlines, 274, 275, 308 Panasonic, 174, 247 Panda Restaurant Group, 214 Pascal, 35 Patagonia, 108, 211 Patel, 106 PayPal, 284 Pelino, D., 331 People's Car, 160, 166 PeopleShareNet, 37 PeopleSoft, 186, 231, 371 PepsiCo., 42, 84, 176, 330, 368, 394 Perez, A., 308 Perot, R., 384, 385 Peterbilt, 211 Peters, T J., 376 Pew Center on Global Climate Change, 33 Pfizer, 71, 306, 330 Pharmacia AB, 305, 345 Pharmacia Upjohn, 178 Philips, 163, 318 Pitney Bowes, 79 Pizza Hut, 198, 214, 222, 338 Plato, 281 PlayStation 27, 221 Pohang Iron & Steel Co Ltd (POSCO), 80 Polaroid Corporation, 274, 307 Porter, M.E., 34, 98, 123, 134, 136, 137, 138, 147, 157, 158, 164, 170, 213, 216, 218 Potlach Corporation, 211 PowerShip, 271 Prahalad, C K., 318 Preda Code of Conduct, 80 PriceWaterhouseCoopers, 145, 365, 384 PRISM software, 372 Prius, 246 Procter & Gamble (P&G), 44, 48, 99, 131, 135, 141, 145, 165, 169, 185, 187, 192, 187, 217, 219, 222, 232, 235, 251, 252, 260, 262, 266, 302, 304, 311, 329, 330, 371, 379 Project Fusion, 302 Project GLOBE, 344 Quaker Oats, 394 Quinn, J B., 50 Qwest, 69, 79, 219 Radio Shack, 365 RAND Corp., 148 Random House, 254 Raytheon, 365 RCA Labs, 180 RE/MAX A-1 Best Realtors, 103 Reebok, 32, 135, 228, 311 Reinemund, S., 84 Reinhardt, F L., 34 Renault, 166, 238, 302, 339 Renshaw, A A., 298 Rensi, E., 271 Rent.com, 284 RHR International, 331 Richardson, B., 182 Riding the Bullet, 254 Rituxan, 49 River Rouge plant, 232 Rivers, R., 48 RJR Nabisco, 363 Roadway Logistics, 270 Roberson, B., 31 Roberts, B., 81 Rockwell Aerospace, 194 Rockwell Collins, 178 Rocky Mountain Institute, 185 Roddick, A., 83, 84 Roj, Y, 80 Rolm and Haas, 71 Roman Catholic Church, 281 Romanos, J., 254 Rosenkrans, W., 157 Ross, D., 326 Royal Dutch Shell, 149, 233 RSD, 221 Rubbermaid, 141, 368 Rumelt, R., 238 Ryall, M D., 144 S C Johnson, 108 Safeguard, 370 Safeway, 212, 294 SAM (Sustainable Asset Management AG) Research, 100 SAM (Sustainable Asset Management Group, 35 SAP AG, 186, 231, 371 Sarason, Y., 320 Sarbanes-Oxley Act, 79, 80, 108 Saturn, 337 Savage, R., 376 SBC Communications, 77 Schilit, H., 388 Schlitz Brewing Co., 75 Schroeder, K., 124 Scientific-Atlanta Inc., 232 ScoreTop.com , 103 Scott Paper, 252 Sears Manufacturing Co., 298 Sears Roebuck and Co., 129, 143, 303, 319, 331, 374 Securities and Exchange Commission (1SEC), 73, 79, 81, 82 Security Outsources Solutions, 145 Seidenberg, I., 85 Service Corporation International, 71, 214 ShareNet, 37 Shea, C., 94 Sherwin-Williams Co., 233 Shopping.com, 284 Shorebank, 108 Siemens, 37, 174, 235 Signal Companies, 231 Simon & Schuster, 234 Simpson Industries, 243 Singer-Loomis, 347 Skoll, J., 284 Skype, 284 Sloan, A P., 281, 303 SmartyPig, 167, 168 Smith & Wesson, 262 Smithfield Foods, 232, 233 Smucker, 108 Snow, C C 141, 312 Society of Competitive Intelligence Professionals (SCIP), 146, 157 Sony Corp., 108, 167, 218, 221, 242 South African Breweries (SAB), 32, 205 Southwest Airlines, 45, 167, 194, 210, 219, 356, 379 Sparks, 105 Sprint Nextel, 133 SSA, 371 Stanberry, T., 168 Standard & Poor's (S&P), 80 Standard Oil, 303, 331 Stanley Works, 371 Staples, 43, 214 Starbucks, 99, 236, 332, 379 Steak & Ale, 244 Steinway, 218 Stern Stewart & Co., 962 Stewart Enterprises, 214 Stewart, J., 328 Stringer, H., 242 Structured Query Language (SQL), 304 Stuart, L S., 330 Stuart, S., 75 StubHub, 284 Stumbleupon, 284 Sullivan, J., 139, 184 Sun Microsystems, 307 Sunbeam, 388 NAME INDEX Super Size Me, 98 Surowiecki, J., 148 Sustainability Yearbook, 35 SWD Inc., 357 Swiss Re 34 Taco Bell, 338 Taisei Corp., 51 Target, 51, 71, 213, 294, 365, 379 Tata Consultancy Services, 384 Tata Group, 279 Tata Motors, 160, 166, 243 Tate, G., 85 Taxin, G., 79 Taylor, A., 423 Technic, 174 Tennessee Valley Authority, 278 Tesco, 235, 237, 372 Tesla Motors, 34 Texas Gas Resources, 240 Texas Instruments, 71 Textron, 378 TIAA-CREF, 75 Tide, 135, 235, 370 Tilt, 105 Timberland, 224 Time, 151 Timex, 210 Toman Corp., 249 Toro, 239 Toshiba, 221, 235 Tower Records, 126 Toyota Motor, 176, 187, 213, 237, 246, 314, 379 Toys "R" Us, 294 Trading Process Network, 271 Trans World Airlines (TWA), 274 Treacy, M 147, 157, 159 Trend Micro, 318 Tricon Global Restaurants, 338 Trident Group, 145 Tyco, 69, 79, 103, 104 U.S Airways, 235 U.S Airways Express, 235 U.S Arctic Research Commission, 118 U.S Climate Action Partnership (USCAP), 346 U.S Constitution, 109 U.S Department of Defense, 372 U.S Department of Energy (DOE), 269 U.S Environmental Protection Agency, 284 U.S False Claims Act, 108 U.S Internal Revenue Service, 369 U.S Securities and Exchange Commission (SEC), 72, 146 U.S Steel 80 U.S West, 219 Unilever, 48, 260, 262, 269, 319, 334 Union Carbide, 270 Union of South American Nations, 33 United Airlines (UAL), 76, 235, 274 United Auto Workers, 184 United Distillers, 149 United Express, 235 United Parcel Service (UPS), 43, 46, 149, 184, 224, 271, 379 United Self Defense Forces of Columbia (AUC), 114 United States Chamber of Commerce, 145 United States Index, 100 United Steel Workers, 184 University of Michigan, 318 University of Southern California, 80 University of the Arctic, 121 Upjohn Pharmaceuticals, 345 Urschel Laboratories, 263 Van Alstyne, M 298 Van Bever, D., 294, 296 Van Der Linde, B., 358 VCA Antech, 214 Venktraman, N V., 384 Verizon Communications, 85 Verry, S., 294, 296 Vidal Sassoon, 370 Virgin, 84 Volkswagen, 371 Volvo, 294 W&T Offshore, 81 Wagoner, R., 246 Wake Forest University, 346 Walgreen Co., 128, 294 Wall Street Journal, 94 Wal-Mart, 35, 167, 1637, 210, 213, 235, 236, 237, 242, 266, 282, 294, 368, 371, 372, 379 Walsh, J P., 98 Walsh K., 394 Walt Disney Co., 86, 176, 211, 275, 307 Warner-Lambert, 51, 306 Waterman, R H., 376 Watkins, S., 104, 106 Web 2.0 254 WebFountain, 131 Welch, J., 251, 282, 314, 332 West Bank, 168 Westinghouse, 220 Weyerhauser, 169 Wheaties, 94 Wheeling-Pittsburgh Steel, 76, 308 Whirlpool Corp., 71, 151, 163, 201, 215, 243, 264, 267, 271, 339, 371 Whisper, 235 Whitman, M., 284, 372 Who Wants to Be a Millionaire?, 275 Wiersema, F., 147, 57, 159 Wiersema, M., 86 Wilburn, N., 311 Wilburn, R., 311 Williamson, E., 234 Windows, 135, 142, 217 Wisdom of Crowds, 148 Woods, T., 228 Word, 135 Work Design Collaborative, 183 World Bank, 125 World Custom Organization, 370 World Index, 100 World is Flat, 32 World Knowledge, 254 World Political Risk Forecasts, 139 World Trade Organization (WTO), 127, 136 WorldCom, 68, 69, 79, 103, 104 Wrigley, 42 Xerox, 163, 298, 314, 331, 332, 333, 368 Yahoo!, 394 Yamaha, 218 Yankelovich Partners, 390 Young, S., 334 Yum! Brands, 222, 236, 338 Zabriskie, 345 Zamboni, F., 203 Zimmer Holdings, 128 Zook, C 228 SUBJECT INDEX 10-K form, 390 10-Q form, 390 14-A form, 390 360-degree appraisal, 270 80/20 rule, 375 Accounting, forensic, 388 Acquisition, 232, 237 Action plan, 340, 341 Activity-based costing (ABC), 358 Activity ratios, 390 Adaptive mode, 50 Advanced Manufacturing Technology (AMT), 266 Affiliated directors, 73 Agency theory, 72, 74 AIDS, 128 Analysis, financial, 390 Analysis, industry, 134 Analysis, organizational, 162 Analysis, portfolio, 244 Analytical portfolio manager, 328 Analyzers, 141 Annual report, 390 Appraisal system, 331 Arms race, 274 Assessment centers, 331 Assets, 162 Assimilation, 339 Assumptions, 147 Autonomous (self-managing) work teams, 183 Backward integration, 232 Bad service excuses, 301 Balanced scorecard, 363 Bankruptcy formula, 395 Bankruptcy, 243 Bargaining power of buyers, 136 Bargaining power of suppliers, 137 Barrier, entry, 135 Basic R&D, 178 Behavior controls, 356 Behavior substitution, 374 Benchmarking, 368 Blind spot analysis, 157 Board of directors, 69 Board of directors, committees, 78 Board of directors, continuum, 70, 71 Board of directors, election, 77 Board of directors, evaluation of, 365 Board of directors, members, 72 Board of directors, nomination, 77 Board of directors, organization, 78 Board of directors, responsibilities, 69 Board of directors, staggered, 77 Books, electronic, 254 BOT concept (Build Operate Transfer), 238 Brainstorming, 148 Brand management, 311 Brand, 176 Brand, corporate, 176 BRIC countries, 125 Budget, 46, 300 Budget analysis, 368 Business ethics, 103 Business intelligence, 144 Business model, 166 Business policy, 29 Business strategy, 43, 207 Buyers, bargaining power, 136 Bypass attack, 218 CAD/CAM, 182, 266 Capabilities, 162 Capabilities, dynamic, 162, 215 Cap-and-trade, 394 Capital budgeting, 177 Capital, social, 98 Captive company, 235 Captive company strategy, 243 Carbon footprint, 123, 124 Carbon trading, 394 Case analysis methodology, 404 Case method, 389 Cash cows, 47 Categorical imperatives, 109 Cautious profit planner, 328 Cellular organization, 312 Cellular structure, 312 Center of excellence, 252 Center of gravity, 169 Centralization, 318 Chairman of the Board, 78 Chief Risk Officer, 359 Chief Strategy Officer, 86 Choice, criteria, 282 Choice, strategic, 291 Cloud computing, 126 Co-creation, 187 Code of ethics, 107 Codetermination, 76 Collusion, 219 Commodity, 136 Common-size statements, 395 Common thread, 206 Communication, 338 Competency, core, 162 Competency, distinctive, 162 Competition, multipoint, 252 Competitive advantage, 163 Competitive analysis techniques, 157 Competitive intelligence, 144 Competitive intelligence, sources, 145 Competitive scope, 209 Competitive strategy 207 Competitive tactics, 216 Complementor, 137 Concentration strategy, 232 Concentric diversification, 238, 239 Concurrent engineering, 183 Conglomerate diversification, 239 Conglomerate structure, 172 Connected line batch flow, 266 Consensus, 281 Consolidated industry, 138 Consolidation, 242 Constant dollars, 396 Consumer Price Index (CPI), 396 Continuous improvement, 267, 342 Continuous systems, 181 Continuum of sustainability, 165 Continuum, board of directors, 70 Continuum, vertical integration, 233 Contraction, 242 Control, guidelines, 375 Controls, behavior, 356 Controls, input, 357 Controls, output, 356 Cooperative strategies, 219 Co-opetition, 224 Core competency, 162 Core rigidity/deficiency, 162, 308 Corporate brand, 176 Corporate culture, 173, 279 Corporate culture, managing, 335 Corporate culture, pressures from, 279 Corporate governance, 69, 80 Corporate govemance, trends, 81 Corporate parenting, 250, 251 Corporate reputation, 176 Corporate scenarios, 275 Corporate stakeholders, 99 Corporate strategy, 43, 230 Corporate valuation, 364 Corporate value-chain analysis, 170 Corporation, 69 Cost focus, 211 Cost leadership, 210 Cost proximity, 212 Costing, activity-based, 358 Counterfeit goods, 370 Crisis of autonomy, 306 Crisis of control, 306 Crisis of leadership, 304 Critical mass, 231 Cross-functional work teams, 183 Cultural integration, 173 Cultural intensity, 173 Culture of fear, 66 Culture, corporate, 173, 279, 335 SUBJECT INDEX Customer satisfaction, 342 Cycle of decline, 244 Decentralization, 318 Decision making, ethical, 103 Decision making modes, 49 Decision making, strategic, 49 Deculturation, 340 Dedicated transfer lines, 266 Defenders, 141 Defensive tactics, 218 Delphi technique, 148 Devil's advocate, 281 Dialectical inquiry, 281 Differentiation, 210 Differentiation focus, 212 Differentiation strategy, 209 Dimensions of quality, 213 Directional strategy, 230, 231 Director of Corporate Development, 86 Director, lead, 78 Directors, affiliated, 73 Directors, family, 75 Directors, inside, 72 Directors, outside, 72 Directors, retired executive, 73 Discretionary responsibilities, 97 Disk operating system (DOS), 204 Distinctive competencies, 162 Diverse workforce, 270 Diversification, concentric, 238 Diversification, conglomerate, 239 Diversification, related, 238 Diversification strategy, 232, 238 Diversification, unrelated, 239 Diversity, human, 185 Divestment, 243 Divisional structure, 171, 303, 306 Do everything strategy, 274 Dogs, 247 Downsizing, 332 Due care, 70 Durability, 164 Dynamic capabilities, 162, 215 Dynamic industry expert, 328 Dynamic pricing, 263 Earnings guidance, 373 Earnings per share (EPS), 356, 359 e-books, 254 Ecomagination, 26 Economic forces, 125 Economic responsibilities, 97 Economic Value Added (EVA), 362 Economics, transaction cost, 133 Economies of scale, 182 Economies of scope, 171, 182 EFAS (External Factors Analysis Summary) Table, 150 Election of board members, 77 Electric car, 246 Electronic books, 254 Employee stock ownership plans (ESOP), 76 Encirclement, 218 Engineering (or process) R&D, 178 Enterprise Resource Planning (ERP), 371 Enterprise Risk Management (ERM), 359 Enterprise strategy, 100 Entrepreneurial mode, 50 Entry barrier, 135 Environment, natural, 123 Environment, societal, 124 Environment, task, 131 Environmental scanning, 40, 122 Environmental sustainability, 32, 99 Environmental uncertainty, 122 Environmental variables, 40 EPS (earnings per share), 373 Equilibrium, punctuated, 47 Ethical decision making, 103 Ethical responsibilities, 97 Ethics, 108 Ethics code, 107 Evaluating board of directors, 365 Evaluating top management, 365 Evaluation and control, 46 Evaluation and control process, 344 Evolution, industry, 138 Exclusive contract, 234 Excuses for bad service, 301 Executive leadership, 84 Executive succession, 329 Executive type, 328 Exit barriers, 136 Expatriate, 334 Expatriates, stealth, 335 Expense centers, 367 Experience curve, 181 Expert opinion, 148 Explicit knowledge, 165 Exporting, 235 External environment, 40 External growth, 240 External strategic factors, 133 Externalities, 123 Extranet, 186 Extrapolation, 148 Eyeballs, 360 Family directors, 75 Financial analysis, 390, 393 Financial expert, 79 Financial issues, 177 Financial leverage, 177 Financial measures, 359 Financial statements, 393 Financial strategy, 263 First mover, 217 Flanking maneuver, 218 Flexible manufacturing, 182 Flexible manufacturing systems, 266 Follow the leader, 274 Follow-the-sun management, 271 Forecasting, 147 Forecasting techniques, 148 Forensic accounting, 388 Form 10-K, 390 Form 10-Q, 390 Form 14-A, 390 Formulation of strategy, 41 Forward integration, 232 Four-corner exercise, 157, 158 Fragmented industry, 138 Franchising, 236 Frankenfood, 128 Free cash flow, 360 Free-market capitalism, 104 Frogs in boiling water, 106 Frontal assault, 217 Full integration, 233 Functional strategy, 44, 260 Functional structure, 171, 305 GE business screen, 247 Generally Accepted Accounting Principles (GAAP), 369, 395 Geographic-area structure, 319 Global industries, 139 Global MNC, 370 Global warming, 36, 364 Globalization 32 Goal, 42 Goal displacement, 374 Golden rule, 109 Good will, 394 Governance system, 104, 105 Governance, corporate, 69, 80 Green-field development, 237 Greenwash, 28 Gross domestic product (GDP), 397 Group, strategic, 139 Growth, external, 240 Growth, horizontal, 235 Growth, internal, 240 Growth strategies, 231 Growth strategies, controversies, 240 Growth, vertical, 232 Guerrilla warfare, 218 Guideline for decision making, 45 Guidelines for control, 375 Halal foods, 198 Hierarchy of strategy, 44 Historical comparisons, 368 Hit another home run, 274 Horizontal growth, 235 Horizontal integration, 235 Horizontal strategy, 252 Hubris, 85 SUBJECT INDEX Human assets, 162 Human diversity, 185 Human resource issues, 182 Human Resource Management (HRM), 270 Hurdle rate, 46, 177 Hypercompetition, 141, 215 IFAS (Internal Factor Analysis Summary) Table, 188 Imitability, 164 Implementation of strategy, 45 Incentives, strategic, 376 Index of sustainable growth, 396 Individual rights approach, 109 Individualism-collectivism (I-C), 343 Industries, global Industries, multidomestic Industries, regional, 139 Industry, 133 Industry analysis, 123, 134 Industry evolution, 138 Industry matrix, 143 Industry scenario, 149, 276 Industry value-chain analysis, 169 Information systems, strategic, 371 Information technology issues, 186 Information technology strategy, 271 Input controls, 357 Inside directors, 72 Institution theory, 37 Institutional investors, 81 Intangible assets, 162 Integration, 339 Integration, backward, 232 Integration, forward, 232 Integration, full, 233 Integration, horizontal, 235 Integration manager, 327 Integration, quasi, 233 Integration, taper, 233 Integration, vertical, 232 Intelligence, competitive, 144 Interlocking directorate, 76 Interlocking directorate, direct, 76 Interlocking directorate, indirect, 76 Intermittent systems, 180 Internal environment, 40 Internal growth, 240 International entry options, 235 International Financial Reporting Standards(IFRS), 369 International measurement, 368 International societal considerations, 129 International strategic alliances, 316 International transfer pricing, 369 Intranet, 186 Inventory turnover ratio, 356 Investment centers, 367 Investors, institutional, 81 Islamic law (sharia), 129 ISO 9000 Standards Series, 357 ISO 14000 Standards Series, 357 Issues priority matrix, 133 Job characteristics model, 315 Job design, 314 Job enlargement, 314 Job enrichment, 314 Job rotation, 314, 331 Job shop, 180, 266 Joint venture, 221, 236 Justice approach, 109 Just-In-Time (JIT), 267, 268 Keiretsu, 76 Keirsey Temperament Sorter, 347 Key performance measures, 363 Key success factors, 142 KFC, 55 Knowledge, explicit, 165 Knowledge, tacit, 165 Laissez-faire, 96 Late movers, 217 Law, 108 Lead director, 78 Leaders, transformational, 84 Leadership, executive, 84 Leading, 335 Leading, international, 343 Lean Six Sigma, 298, 314 Learning organization, 37 Legal responsibilities, 97 Levels of moral development, 107 Leverage ratios, 390 Leverage, fmancial, 177 Leverage, operating, 181 Leveraged buyout, 264 Licensing, 236 Licensing arrangement, 222 Line extensions, 260 Liquidation, 244 Liquidity ratios, 390 Logical incrementalism, 50 Logistics strategy, 270 Long-range plans, 41 Long-term contracts, 234 Long-term evaluation method, 376 Long-term orientation (LT), 344 Losing hand, 275 Lower cost strategy, 209 Management audits, 365 Management Buy Outs, 264 Management By Objectives (MBO), 342, 344 Management contracts, 238 Management directors, 72 Management tool, 31 Manual typewriters, 247 Manufacturing, flexible, 182 Market development, 260 Market development strategy, 260 Market location tactic, 217 Market position, 175 Market segmentation, 175 Market Value Added (MVA), 362 Marketing issues, 175 Marketing mix, 175 Marketing strategy, 260 Masculinity-femininity (M-F), 344 Mass customization, 182, 268 Mass production, 266 Matrix, BCG growth share, 245 Matrix, industry, 143 Matrix of change, 298, 299, 300 Matrix, SFAS, 200 Matrix structure, 309, 310 Matrix, TOWS, 206 Measurement problems, 372 Measures of corporate performance, 359 Measures of divisional and functional, 366 Measures, financial, 359 Measures, international, 368 Measures, key performance, 363 Measures, stakeholder, 361 Measuring performance, 356 Merger, 231 Mindshare, 360 Mission, 41, 205 Mission statement, 41, 42 MNC, global, 370 MNC, multidomestic, 370 Model, business, 166 Modes of strategic decision making, 49 Modular manufacturing, 267 Modular structure, 312 Moore's Law, 179 Moral development levels, 107 Moral relativism, 106 Morality, 108 Most favored nation, 127 Muddling through, 50 Multidomestic industries, 138 Multidomestic MNC, 369, 370 Multinational Corporation (MNC), 129, 315 Multinational corporation, global, 316 Multinational corporation, 316 Multiple sourcing, 268 Multipoint competition, 252 Mutual service consortium, 221 MUUs (monthly unique users), 360 Natural environment, 123 Net present value (NPV), 278 Network structure, 311 New entrants, 135 SUBJECT INDEX Niche, propitious, 201 No-change strategy, 241 Nomination of board members, 77 Non-management directors, 72 Northern Sea Route, 120 Northwest Passage, 118 Objectives, 42, 205 Offensive tactics, 217 Offshoring, 272 Open innovation, 265 Operating budgets, 366 Operating cash flow, 360 Operating leverage, 181 Operational planning, 45 Operations issues, 180 Operations strategy, 266 Organization slack, 232 Organizational learning theory, 37 Organizational life cycle, 307 Organizational structures, 171, 309 Other stakeholders, 137 Output controls, 356 Outside directors, 72 Outsourcing, 235, 237, 271 Outsourcing matrix, 274 Parallel sourcing, 269 Parenting, corporate, 250 Parenting strategy, 230 Pascal's wager, 35 Pause/proceed-with-caution strategy, 241 Penetration pricing, 263 PepsiCo, 338 Performance, 46, 356 Performance appraisal system, 331 Performance, corporate, 359 Performance, divisional, 366 Performance evaluations, 365 Performance, functional, 366 Performance gap, 48 Performance, key measures, 363 Periodic statistical reports, 366 PESTEL analysis, 125 Phases of strategic management, 29 Pioneer, 217 Pirated software, 370 Planning mode, 50 Planning, operational, 45 Plans, long-range, 41 Policies, 45, 282 Policy, 45 Political-legal forces, 126 Political strategy, 279 Pooling method, 394 Population ecology, 36, 37 Portfolio analysis, 230, 244 Portfolio analysis, advantages/ disadvantages, 249 Portfolio analysis, strategic alliances, 249 Power distance (PD), 343 Prediction markets, 148 Pressure-cooker crisis, 307 Pricing, dynamic, 263 Pricing, penetration, 263 Pricing, skim 263 Prime interest rate, 396 Problem children, 246 Procedures, 46, 300 Product development, 260 Product development strategy, 260 Product life cycle, 176 Product R&D, 178 Product-group structure, 319 Production sharing, 237 Professional liquidator, 328 Profit centers, 367 Profit strategy, 242 Profitability ratios, 390 Profits, repatriation of, 369 Program, 45, 298 Propitious niche, 201, 205 Prospectors, 141 Pull strategy, 263 Punctuated equilibrium, 47 Purchasing power parity (PPP), 131 Push strategy, 263 Quality circles, 344 Quality dimensions, 213 Quality of Work, 184 Quasi-integration, 233 Question marks, 246 R&D intensity, 178 R&D issues, 178 R&D mix, 178 R&D strategy, 265 Radio frequency identification (RFID), 187, 372 Ratio analysis, 390 Reactors, 141 Real-options approach, 278 Red flag, 388 Red tape crisis, 306 Reengineering, 312 Regional industries, 139 Related diversification, 238 Relativism, moral, 106 Repatriation of profits, 124, 369 Replicability, 165 Report, annual, 390 Reputation, corporate, 176 Resizing, 332 Resource-based approach, 162 Resources, 162 Resources for Case Research, 401 Responsibilities, boards of directors, 69 Responsibilities of a business, 96, 97 Responsibilities, top management, 82 Retaliation, 219 Retired executive directors, 73 Retrenchment, 332 Retrenchment strategies, 231, 242 Return On Equity (ROE), 360 Return On Investment (ROI) 356, 359, 360 367, 368, 369, 373 Revenue centers, 367 Reverse engineering, 164 Reverse logistics, 190 Reverse stock splits, 264 Revival phase, 308 Rightsizing, 332 Risk, 277 Risks in competitive strategies, 212 Rivalry, 135 Rivalry among existing firms, 135 ROE (Return on Equity), 360 ROI (Return on Investment), 359 Role of the board of directors, 70 Rules of thumb, 375 Sarbanes-Oxley Act, 79 SBUs, 306, 376 Scenario analysis, 359 Scenario box, 276 Scenario, industry, 149 Scenario writing, 149 Scorecard, balanced, 363 SEC 10-K form, 390 SEC 10-Q forms, 390 SEC 14-A forms, 390 Self-managing work teams, 270 Sell-out strategy, 243 Separation, 340 SFAS (Strategic Factors Analysis Summary) Matrix, 200 Shareholder, 69 Shareholder value, 361 Short-term orientation, 373 Simple structure, 171, 304 Situational analysis, 200 Six Sigma, 28, 298, 313 Skim pricing, 263 Social capital, 98 Social responsibility, 96 Societal environment, 123, 124, 125 Societal environment, international, 129 Sociocultural forces, 127 Sole sourcing, 268 Sourcing, 271 Stability strategies, 231, 241 Staff, strategic planning, 86 Staffing, 326 Staffing follows strategy, 327 Staffing, international, 333 Stages of corporate development, 304 Stages of international development, 317 Staggered board, 77 Stakeholder analysis, 99 SUBJECT INDEX Stakeholder measures, 361 Stakeholder priority matrix, 279 Stakeholder, primary, 101 Stakeholder, secondary, 101 Stakeholders, 99 Stall point, 294 Standard cost centers, 366 Standard Operating Procedure (SOP), 46, 300 Star employee, 346 Stars, 246 Statistical modeling, 148 Stealth expatriates, 335 STEEP analysis, 124, 125 Steering controls, 356 Stewardship theory, 73, 74 Stickiness, 360 Strategic alliance portfolio, 249 Strategic alliance, 220 Strategic alliances, intemational, 316 Strategic audit, 52, 58, 149, 187, 366, 397 Strategic audit, student-written, 407 Strategic audit worksheet, 397, 398 Strategic business units (SBUs), 172 Strategic choice, 281 Strategic choice perspective, 37 Strategic decision making, 49 Strategic decision-making process, 51, 52 Strategic decisions, 49 Strategic factors, 40, 133, 201 Strategic flexibility, 37 Strategic-funds method, 377 Strategic group, 139 Strategic incentive management, 376 Strategic inflection point, 48 Strategic information systems, 371 Strategic management benefits, 30 Strategic management model, 39 Strategic management phases, 29 Strategic management process, 39 Strategic management, 29 Strategic myopia, 132 Strategic planning process, 85 Strategic planning staff, 86 Strategic posture, 58 Strategic rollup, 214 Strategic sweet spot, 201, 204 Strategic type, 141 Strategic vision, 84 Strategic window, 203 Strategies to avoid, 274 Strategies, growth, 231 Strategies, retrenchment, 242 Strategies, stability, 241 Strategy, 43 Strategy, business, 43, 207 Strategy, competitive, 207 Strategy, concentration, 232 Strategy, cooperative, 219 Strategy, corporate, 43 Strategy-culture compatibility, 336 Strategy, diversification, 238 Strategy, enterprise, 100 Strategy formulation, 41, 200 Strategy, functional, 44 Strategy, hierarchy, 44 Strategy, horizontal, 252 Strategy implementation, 245, 96, 298 Strategy, political, 279 Structural barriers, 218 Structure, cellular, 312 Structure, divisional, 306 Structure follows strategy, 303 Structure, functional, 305 Structure, geographic-area, 319 Structure, matrix, 309 Structure, modular, 312 Structure, network, 311 Structure, product-group, 319 Structure, simple, 304 Structures, organizational, 171, 309 Stuck in the middle, 213, 290 Suboptimization, 374 Substitute product, 136 Suppliers, bargaining power, 137 Supply chain management, 187 Sustainability continuum, 165 Sustainability, 99, 164 Sustainability, environmental, 32, 99 Sustainability index, 100 Sustainable growth, index of, 395 Sweet spot, strategic, 201 Switching costs, 135 SWOT analysis, 40, 200 Synergy, 238, 302 Synergy Game, 320 Tacit knowledge, 165 Tactic, 216 Tactics, timing, 217 Tactics, competitive, 216 Tactics, defensive, 218 Tactics, market location, 217 Tactics, offensive, 217 Take rate, 372 Takeovers, 232 Tangible assets, 162 Taper integration, 233 Task environment, 123, 131 Teams, 181,, 183 Technological competence, 178 Technological discontinuity, 179 Technological follower, 265 Technological forces, 126 Technological leader, 265 Technology scouts, 266 Technology transfer, 178 Temporary/part-time workers, 183 Theories of organizational adaptation, 36 Threat of new entrants, 135 Threat of substitutes, 136 Timing tactic 217 Top management, 69 Top management responsibilities 82 Top management, evaluation of 365 Total Quality Management (TQM), 342, 344 TOWS Matrix, 206 Trade associations, 33 Transaction cost economics, 233 234 Transfer pricing, 367 Transfer pricing, international, 369 Transferability, 164 Transformational leaders, 84 Transparency, 164 Trends in corporate governance, 81 Trigger point, 130, 131 Triggering event, 48 Turnaround specialist, 328 Turnaround strategy 242 Turnkey operations, 237 Turnover, 395 Types, strategic, 141 Typewriters, manual, 247 Uncertainty avoidance (UA), 343 Union relations, 183 Unrelated diversification, 239 Utilitarian approach, 109 Valuation, corporate, 364 Value Added, economic, 362 Value added, market, 362 Value chain, 167 Value discipline triad, 159 Value disciplines, 157 Value, shareholder, 361 Value-chain analysis, 167 Value-chain, corporate, 170 Value-chain, industry, 169 Value-chain partnership, 222 Values statement, 41 Vertical growth, 234 Vertical growth strategy, 232 Vertical integration, 169, 232, 234 Virtual organization, 311 Virtual teams, 183 Vision, 41 Vision, strategic, 84 VRIO framework, 162 War game, 158 Web 2.0, 186, 254 Weighted-factor method, 376 Whistleblowers, 79, 108 Wildcats, 246 Z-Value Bankruptcy Formula, 395 [...]... 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