Description
This document about business policy and strategic management.
I TWELFTH EDITION
Business
Policy
Thomas L. Wheelen
Formerly with University of Virginia
Trinity College, Dublin Ireland
J. David Hunger
Iowa State University
St. John's University
Prentice Hall
Boston Columbus Indianapolis New York San Francisco Upper Saddle River
Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto
Delhi Mexico City Sao Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo
Preface 29
PART ONE Introduction to Strategic Management and Business Policy 49
CHAPTER 1 Basic Concepts of Strategic Management 50
1.1 The Study of Strategic Management 53
Phases of Strategic Management 53
Benefits of Strategic Management 54
1.2 Globalization and Environmental Sustainability: Challenges to Strategic
Management 55
Impact of Globalization 56
Impact of Environmental Sustainability 56
Global Issue: REGIONAL TRADE ASSOCIATIONS REPLACE NATIONAL TRADE BARRIERS 57
Environmental Sustainability Issue: PROJECTED EFFECTS OF CLIMATE CHANGE 60
1.3 Theories of Organizational Adaptation 60
1.4 Creating a Learning Organization 61
1.5 Basic Model of Strategic Management 62
Environmental Scanning 64
Strategy Formulation 65
Strategy Highlight 1.1: DO YOU HAVE A GOOD MISSION STATEMENT? 66
Strategy Implementation 69
Evaluation and Control 70
Feedback/Learning Process 71
1.6 Initiation of Strategy: Triggering Events 71
Strategy Highlight 1.2: TRIGGERING EVENT AT UNILEVER 72
1.7 Strategic Decision Making 73
What Makes a Decision Strategic 73
Mintzberg's Modes of Strategic Decision Making 73
Strategic Decision-Making Process: Aid to Better Decisions 75
1.8 The Strategic Audit: Aid to Strategic Decision-Making 76
1.9 End of Chapter Summary 77
APPENDIX 1.A Strategic Audit of a Corporation 82
CONTENTS
CHAPTER 2 Corporate Governance 90
2.1 Role of the Board of Directors 93
Responsibilities of the Board 93
Members of a Board of Directors 96
Strategy Highlight 2.1: AGENCY THEORY VERSUS STEWARDSHIP THEORY IN CORPORATE
GOVERNANCE 98
Nomination and Election of Board Members 101
Organization of the Board 102
Impact of the Sarbanes-Oxley Act on U.S. Corporate Governance 103
Global Issue: CORPORATE GOVERNANCE IMPROVEMENTS THROUGHOUT THE WORLD 104
Trends in Corporate Governance 105
2.2 The Role of Top Management 106
Responsibilities of Top Management 106
Environmental Sustainability Issue: CONFLICT AT THE BODY SHOP 107
2.3 End of Chapter Summary 110 -
CHAPTER 3 Social Responsibility and Ethics in Strategic Management 118
3.1 Social Responsibilities of Strategic Decision Makers 120
Responsibilities of a Business Firm 120
Sustainability: More Than Environmental? 123
Corporate Stakeholders 123
Environmental Sustainability issue: THE DOW JONES SUSTAINABILITY INDEX 124
Strategy Highlight 3.1: JOHNSON & JOHNSON CREDO 126
3.2 Ethical Decision Making 127
Some Reasons for Unethical Behavior 127
Strategy Highlight 3.2: UNETHICAL PRACTICES AT ENRON AND WORLDCOM EXPOSED BY
"WHISTLE-BLOWERS" 128
Global Issue: HOW RULE-BASED AND RELATIONSHIP-BASED GOVERNANCE SYSTEMS
AFFECT ETHICAL BEHAVIOR 129
Encouraging Ethical Behavior 131
3.3 End of Chapter Summary 134
Ending Case for Part One: BLOOD BANANAS 138
PARTJWO____Scanning_the Environment 141
CHAPTER 4 Environmental Scanning and Industry Analysis 142
4.1 Environmental Scanning 146
Identifying External Environmental Variables 146
CONTENTS | | | | | | | v %
Environmental Sustainability Issue: MEASURING AND SHRINKING YOUR PERSONAL
CARBON FOOTPRINT 148
Global Issue: IDENTIFYING POTENTIAL MARKETS IN DEVELOPING NATIONS 155
Identifying External Strategic Factors 156
4.2 Industry Analysis: Analyzing the Task Environment 157
Porter's Approach to Industry Analysis 158
Industry Evolution 162
Categorizing International Industries 162
International Risk Assessment 163
Strategic Groups 163
Strategic Types 165
Hypercompetition 165
Using Key Success Factors to Create an Industry Matrix 166
Strategy Highlight 4. 1: MICROSOFT IN A HYPERCOMPETITIVE INDUSTRY 166
4.3 Competitive Intelligence 168
Sources of Competitive Intelligence 169
Strategy Highlight 4.2: EVALUATING COMPETITIVE INTELLIGENCE 170
Monitoring Competitors for Strategic Planning 170
4.4 Forecasting 171
Danger of Assumptions 171
Useful Forecasting Techniques 172
4.5 The Strategic Audit: A Checklist for Environmental Scanning 173
4.6 Synthesis of External Factors—EFAS 174
4.7 End of Chapter Summary 175
This document about business policy and strategic management.
I TWELFTH EDITION
Business
Policy
Thomas L. Wheelen
Formerly with University of Virginia
Trinity College, Dublin Ireland
J. David Hunger
Iowa State University
St. John's University
Prentice Hall
Boston Columbus Indianapolis New York San Francisco Upper Saddle River
Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto
Delhi Mexico City Sao Paulo Sydney Hong Kong Seoul Singapore Taipei Tokyo
Preface 29
PART ONE Introduction to Strategic Management and Business Policy 49
CHAPTER 1 Basic Concepts of Strategic Management 50
1.1 The Study of Strategic Management 53
Phases of Strategic Management 53
Benefits of Strategic Management 54
1.2 Globalization and Environmental Sustainability: Challenges to Strategic
Management 55
Impact of Globalization 56
Impact of Environmental Sustainability 56
Global Issue: REGIONAL TRADE ASSOCIATIONS REPLACE NATIONAL TRADE BARRIERS 57
Environmental Sustainability Issue: PROJECTED EFFECTS OF CLIMATE CHANGE 60
1.3 Theories of Organizational Adaptation 60
1.4 Creating a Learning Organization 61
1.5 Basic Model of Strategic Management 62
Environmental Scanning 64
Strategy Formulation 65
Strategy Highlight 1.1: DO YOU HAVE A GOOD MISSION STATEMENT? 66
Strategy Implementation 69
Evaluation and Control 70
Feedback/Learning Process 71
1.6 Initiation of Strategy: Triggering Events 71
Strategy Highlight 1.2: TRIGGERING EVENT AT UNILEVER 72
1.7 Strategic Decision Making 73
What Makes a Decision Strategic 73
Mintzberg's Modes of Strategic Decision Making 73
Strategic Decision-Making Process: Aid to Better Decisions 75
1.8 The Strategic Audit: Aid to Strategic Decision-Making 76
1.9 End of Chapter Summary 77
APPENDIX 1.A Strategic Audit of a Corporation 82
CONTENTS
CHAPTER 2 Corporate Governance 90
2.1 Role of the Board of Directors 93
Responsibilities of the Board 93
Members of a Board of Directors 96
Strategy Highlight 2.1: AGENCY THEORY VERSUS STEWARDSHIP THEORY IN CORPORATE
GOVERNANCE 98
Nomination and Election of Board Members 101
Organization of the Board 102
Impact of the Sarbanes-Oxley Act on U.S. Corporate Governance 103
Global Issue: CORPORATE GOVERNANCE IMPROVEMENTS THROUGHOUT THE WORLD 104
Trends in Corporate Governance 105
2.2 The Role of Top Management 106
Responsibilities of Top Management 106
Environmental Sustainability Issue: CONFLICT AT THE BODY SHOP 107
2.3 End of Chapter Summary 110 -
CHAPTER 3 Social Responsibility and Ethics in Strategic Management 118
3.1 Social Responsibilities of Strategic Decision Makers 120
Responsibilities of a Business Firm 120
Sustainability: More Than Environmental? 123
Corporate Stakeholders 123
Environmental Sustainability issue: THE DOW JONES SUSTAINABILITY INDEX 124
Strategy Highlight 3.1: JOHNSON & JOHNSON CREDO 126
3.2 Ethical Decision Making 127
Some Reasons for Unethical Behavior 127
Strategy Highlight 3.2: UNETHICAL PRACTICES AT ENRON AND WORLDCOM EXPOSED BY
"WHISTLE-BLOWERS" 128
Global Issue: HOW RULE-BASED AND RELATIONSHIP-BASED GOVERNANCE SYSTEMS
AFFECT ETHICAL BEHAVIOR 129
Encouraging Ethical Behavior 131
3.3 End of Chapter Summary 134
Ending Case for Part One: BLOOD BANANAS 138
PARTJWO____Scanning_the Environment 141
CHAPTER 4 Environmental Scanning and Industry Analysis 142
4.1 Environmental Scanning 146
Identifying External Environmental Variables 146
CONTENTS | | | | | | | v %
Environmental Sustainability Issue: MEASURING AND SHRINKING YOUR PERSONAL
CARBON FOOTPRINT 148
Global Issue: IDENTIFYING POTENTIAL MARKETS IN DEVELOPING NATIONS 155
Identifying External Strategic Factors 156
4.2 Industry Analysis: Analyzing the Task Environment 157
Porter's Approach to Industry Analysis 158
Industry Evolution 162
Categorizing International Industries 162
International Risk Assessment 163
Strategic Groups 163
Strategic Types 165
Hypercompetition 165
Using Key Success Factors to Create an Industry Matrix 166
Strategy Highlight 4. 1: MICROSOFT IN A HYPERCOMPETITIVE INDUSTRY 166
4.3 Competitive Intelligence 168
Sources of Competitive Intelligence 169
Strategy Highlight 4.2: EVALUATING COMPETITIVE INTELLIGENCE 170
Monitoring Competitors for Strategic Planning 170
4.4 Forecasting 171
Danger of Assumptions 171
Useful Forecasting Techniques 172
4.5 The Strategic Audit: A Checklist for Environmental Scanning 173
4.6 Synthesis of External Factors—EFAS 174
4.7 End of Chapter Summary 175