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Management Leading & Collaborating in the Competitive World
Key terms Chapter 2
33
Business
Graduate
01/11/2010

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Term
open systems
Definition
organizations that are affected by, and that affect, their environment.
Term
inputs
Definition
Goods and services organizations take in to create products or services.
Term
outputs
Definition
The products and services organizations create.
Term
external environment
Definition
All relevant forces outside a firm's boundaries, such as competitors, customers, the government, and the economy.
Term
competitive environment
Definition
The immediate environment surrounding a firm; includes suppliers, customers, rivals, and the like.
Term
macroenvironment
Definition
The general environment; includes governments, economic conditions, and other fundamental factors that generally affect all organizations.
Term
demographics
Definition
Measures of various characteristics of the people who make up groups or other social units.
Term
barriers to entry
Definition
Conditions that prevent new companies from entering an industry.
Term
switching costs
Definition
Fixed cost buyers face when they change suppliers.
Term
supply chain management
Definition
The managing of the network of facilities and people that obtain materials from outside the organization, transform them into products, and distribute them to customers.
Term
final consumer
Definition
Those who purchase products in their final form.
Term
intermediate consumer
Definition
A customer who purchases raw materials or wholesale products before selling them to final customers.
Term
environmental uncertainty
Definition
Lack of information needed to understand or predict the future.
Term
environmental scanning
Definition
Searching for and sorting through information about the environment.
Term
competitive intelligence
Definition
Information that helps managers determine how to compete better.
Term
scenario
Definition
A narrative that describes a particular set of future conditions.
Term
forecasting
Definition
Method for predicting how variables will change the future.
Term
benchmarking
Definition
The process of comparing an organization's practices and technologies with those of other companies.
Term
empowerment
Definition
The process of sharing power with employees, thereby enhancing their confidence in their ability to preform their jobs and their belief that they are influential contributors to the organization
Term
buffering
Definition
creating supplies of excess resources in case of unpredictable needs.
Term
smoothing
Definition
leveling normal fluctuations at the boundaries of the environment.
Term
flexible processes
Definition
methods for adapting the technical core the changes in the environment.
Term
independent strategies
Definition
strategies that an organization acting on its own uses to change some aspect of it's current environment.
Term
cooperative strategies
Definition
strategies used by two or more organizations together to manage the environment.
Term
strategic maneuvering
Definition
an organization's conscious efforts to change the boundaries of its task environment.
Term
domain selection
Definition
entering a new market or industry with an existing enterprise.
Term
diversification
Definition
a firm's investment in a different product, business, or geographic area.
Term
merger
Definition
one or more companies combining with another.
Term
acquisition
Definition
one firm buying another.
Term
divestiture
Definition
a firm selling one or more business.
Term
prospectors
Definition
companies that continually change the boundaries for their task environments by seeking new products and markets, diversifying and merging , or acquiring new enterprises.
Term
defenders
Definition
companies that stay within a stable product domain as a strategic maneuver.
Term
organization culture
Definition
the set of important assumptions about the organization and its goals and practices that members of the company share.
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