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Formulation, Implementation, and Control: Eleventh Edition
Formulation, Implementation, and Control: Eleventh Edition
John A. Pearce II
Villanova School of Business
Villanova University
Boston Burr Ridge, IL Dubuque, IA Madison, Wl New York San Francisco St. Louis
Bangkok Bogota Caracas Kuala Lumpur Lisbon London Madrid Mexico City
Milan Montreal New Delhi Santiago Seoul Singapore Sydney Taipei Toronto
PART ONE Key Terms 43
OVERVIEW OF STRATEGIC Questions for Discussion 43
Discussion Case: Anger over CEO Pay Has
MANAGEMENT 1 Put Directors on the Hot Seat 43
APPENDIX BB&T Vision, Mission,
Chapter 1
and Purpose 45
Strategic Management 2
The Nature and Value of Strategic Management 3 Chapter 3
Dimensions of Strategic Decisions 4 Corporate Social Responsibility and
Formality in Strategic Management 7 Business Ethics 50
Benefits of Strategic Management 9
Risks of Strategic Management 10 The Stakeholder Approach to Social
The Strategic Management Process 10 Responsibility 51
Strategic Management as a Process 14 The Dynamics of Social Responsibility 53
Summary 16 Types of Social Responsibility 56
Key Terms 16 Corporate Social Responsibility and
Questions for Discussion 16 Profitability 58
Discussion Case: Carlyle Changes Its Stripes 17 Sarbanes-Oxley Act of 2002 63
The New Corporate Governance
Structure 66
PART TWO Privatization as a Response to
STRATEGY FORMULATION 23 Sarbanes-Oxley 68
CSR s Effect on the Mission Statement 68
Social Audit 69
Chapter 2
Management Ethics 70
Company Mission 24 The Nature of Ethics in Business 70
What Is a Company Mission? 25 Satisfying Corporate Social
The Need for an Explicit Mission 25 Responsibility 71
Formulating a Mission 26 The Core of the CSR Debate 72
Basic Product or Service; Primary Market; Principal Mutual Advantages of Collaborative
Technology 26 Social Initiatives 74
Company Goals: Survival; Growth; Profitability 28 Five Principles of Successful Collaborative
Company Philosophy 30 Social Initiatives 75
Public Image 31 Assembling the Components 79
Company Self-Concept 32 The Limits of CSR Strategies 81
Newest Trends in Mission Components 34 The Future of CSR 81
An Exemplary Mission Statement 3 7 Approaches to Questions of Ethics 83
Boards of Directors 38 Codes of Business Ethics 84
Agency Theory 39 Major Trends in Codes of Ethics 86
How Agency Problems Occur 40 Summary 86
Problems That Can Result from Agency 41 Key Terms 87
Solutions to the Agency Problem 42 Questions for Discussion 87
Summary 42 Discussion Case: The Poverty Business 87
XXI
xxii Table of Contents