| balanced scorecard | Gives top managers a fast but comprehensive view of the organization via four indicators: (1) customer satisfaction, (2) internal processes, (3) the organization's innovation and improvement activities, and (4) financial measures.
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| competitive intelligence | Gaining information about competitors' activities so that one can anticipate their moves and react appropriately.
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| contingency planning | Also known as scenario planning and scenario analysis; the creation of alternative hypothetical but equally likely future conditions.
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| cost-leadership strategy | One of Porter's four competitive strategies; keeping the costs, and hence prices, of a product or service below those of competitors and targeting the wider market.
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| cost-focus strategy | One of Porter's four competitive strategies; to keep the costs, and hence prices, of a product or service below those of competitors and to target a narrow market.
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| decline stage | The fourth stage in the product life cycle; period in which a product falls out of favor, and the organization withdraws from the marketplace.
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| defensive strategy | Also called retrenchment strategy; one of three grand strategies, this strategy involves reduction in the organization's efforts.
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| differentiation strategy | One of Porter's four competitive strategies; offer products or services that are of a unique and superior value compared to those of competitors and to target a wide market.
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| diversification | Strategy by which a company operates several businesses in order to spread the risk.
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| focused-differentiation strategy | One of Porter's four competitive strategies; to offer products or services that are of unique and superior value compared to those of competitors and to target a narrow market.
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| forecast | A projection of the future.
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| grand strategy | Second step of the strategic-management process; it explains how the organization's mission is to be accomplished. Three grand strategies are growth, stability, and defensive.
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| growth stage | The second stage of the product life cycle. This, the most profitable stage, is the period in which customer demand increases, the product's sales grow, and (later) competitors may enter the market.
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| growth strategy | One of three grand strategies, this strategy involves expansion-as in sales revenues, market share, number of employees, or number of customers or (for nonprofits) clients served.
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| introduction stage | The first stage in the product life cycle; a new product is introduced into the marketplace.
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| maturity stage | A stage when the organization becomes very bureaucratic, large, and mechanistic. (2) The third stage in the product life cycle; period in which the product starts to fall out of favor, and sales and profits fall off.
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| organizational opportunities | The environmental factors that the organization may exploit for competitive advantage.
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| organizational strengths | The skills and capabilities that give the organization special competencies and competitive advantages in executing strategies in pursuit of its mission.
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| organizational threats | The environmental factors that hinder an organization's achieving a competitive advantage.
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| organizational weaknesses | The drawbacks that hinder an organization in executing strategies in pursuit of its mission.
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| Porter's four competitive strategies (four generic strategies) | (1) Costleadership, (2) differentiation, (3) costfocus, (4) focused-differentiation. The first two strategies focus on wide markets, the last two on narrow markets.
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| product life cycle | A model that graphs the four stages of a product or service during the "life" of its marketability: (1) introduction, (2) growth, (3) maturity, and (4) decline.
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| related diversification | Strategy by which an organization under one ownership operates separate businesses that are related to one another.
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| single-product strategy | Strategy by which a company makes and sells only one product within its market.
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| stability strategy | One of three grand strategies, this strategy involves little or no significant change.
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| strategic control | Monitoring performance to ensure that strategic plans are being implemented and taking corrective action as needed.
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| strategic management | A five-step process that involves managers from all parts of the organization in the formulation and implementation of strategies and strategic goals: establish the mission and the vision; establish the grand strategy; formulate the strategic plans; carry out the strategic plans; maintain strategic control.
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| strategy | A large-scale action plan that sets the direction for an organization.
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| strategy formulation | The process of choosing among different strategies and altering them to best fit the organization's needs.
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| strategy implementation | The execution of strategic plans.
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| SWOT analysis | The search for the Strengths, Weaknesses, Opportunities, and Threats that affect an organization.
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| synergy | Situation in which the economic value of separate, related businesses under one ownership and management is greater than the businesses are worth separately.
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| trend analysis | A hypothetical extension of a past series of events into the future.
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| unrelated diversification | Operating several businesses that are not related to one another under one ownership.
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