03 External Environment Factors

Question 1

What are market forces?

Answer 1

The actions of buyers and sellers that cause the prices of goods and services to change without being controlled by the government: the economic forces of supply and demand.

Question 2

What is monopoly?

Answer 2

The exclusive possession or control of the supply of our trade in a commodity or service.

Question 3

What is oligopoly?

Answer 3

A state of limited competition, in which a market is shared by a small number of producers or sellers.

Question 4

What is perfect competition?

Answer 4

The exclusive possession or control of the supply of or trade in a commodity or service.

Question 5

What is imperfect competition?

Answer 5

A state of limited competition, in which a market is shared by a small number of producers or sellers.

Question 6

What is a business-to-consumer market?

Answer 6

Advertising products directly to customers for purchase.

Question 7

What is a business-to-business market?

Answer 7

Advertise and sell their goods or services to other businesses instead of marketing directly to consumers.

Question 8

What is an industrial market?

Answer 8

Sells products or services used in industrial or production projects.

Question 9

What is a services market?

Answer 9

Advertises and sells services instead of products.

Question 10

What is a professional services market?

Answer 10

Facilitates the advertising and sale of services from specialized professions.

Question 11

What is private property?

Answer 11

Allows people to own tangible and intangible assets.

Question 12

What is a positive aspect of private property?

Answer 12

Gives the owner of resources an incentive to maximize their value.

Question 13

What is a negative aspect of private property?

Answer 13

Means people with money stay in control.

Question 14

What is private enterprise?

Answer 14

Allows individuals to control businesses independent of the state.

Question 15

What is a positive aspect of private enterprise?

Answer 15

Allows customers to determine the success of a business, provides employees with wages, ensures investors are responsible for providing capital.

Question 16

What is a negative aspect of private enterprise?

Answer 16

Means that businesses can go out of business, make people redundant or laid off.

Question 17

What is market competition?

Answer 17

Allows individuals to compete to provide superior goods and services.

Question 18

What is a positive aspect of market competition?

Answer 18

Promotes innovation and offering the best products and services at the best prices.

Question 19

What is a negative aspect of market competition?

Answer 19

Can force prices down, which means that companies might cut quality to maintain margins.

Question 20

What is profit as an incentive?

Answer 20

Allows individuals to benefit financially from their endeavors.

Question 21

What is a positive aspect of profit as an incentive?

Answer 21

An incentive to produce goods and services. Promotes innovation, increases efficiency and motivates individuals to take risks and seek new opportunities.

Question 22

What is a negative aspect of profit as an incentive?

Answer 22

Open to corruption where those in control keep all profits to themselves.

Question 23

What is consumer sovereignty?

Answer 23

Allows individuals to freely buy and sell.

Question 24

What is a positive aspect of profit as an incentive?

Answer 24

Allows market economy to gravitate towards equilibrium — a place wheresupply and demandare equal.

Question 25

What is a negative aspect of profit as an incentive?

Answer 25

Can be difficult to tax, i.e.. Government has introduced tax protocols on cash side hustles (e.g. Vinted, etc).

Question 26

What are policy and regulatory changes?

Answer 26

Legislation developed by the sector and government.

Question 27

What is a supply chain?

Answer 27

The sequence of processes involved in the production and distribution of products and services

Question 28

Name some examples of internal policies.

Answer 28

- Employee conduct - Equality and diversity - Attendance and time off - Dress code - Computer use - internet access, social media use - Substance abuse

Question 29

Name some benefits of policies and processes for an organisation and its staff.

Answer 29

- Top-down - Guidance - Effective management tool - Ensures consistency and equality - Accountability and liability protection - Communicates employer expectations

Question 30

Name some limitations of policies and processes for an organisation and its staff.

Answer 30

- Stifles innovation and creativity - Cost of enforcing policies and procedures - Slows down decision making

Question 31

Name some of the importance's of policies and processes.

Answer 31

- Maintains internal control - Creates consistency - Creates awareness of risk - Maintains regulatory compliance - Time and cost efficiencies.

Question 32

Name some potential consequences of not following policies and processes for the organisation.

Answer 32

- Service failure - Quality issues - Missed deadlines - Loss of reputation

Question 33

Name some potential consequences of not following internal policies and processes for the individual.

Answer 33

- Breach of trust - Breach of contract - Breakdown in working relationships - Failure to meet targets - Disciplinary procedures

Question 34

How can policy and regulatory change affect a business?

Answer 34

Regulatory bodies often update the rules that businesses must abide by. The updates made to laws and regulations are regulatory changes.

Question 35

What is a regulatory policy?

Answer 35

‌‌Regulatory policy is about achieving government's objectives through the use of regulations, laws, and other instruments to deliver better economic and social outcomes and thus enhance the life of citizens and business.

Question 36

What is an example of a regulatory change?

Answer 36

Keeping up with changes can help companies stay ahead of the competition. A change in the tax code can impact the way a company competes with other companies in its industry, for example. A change in environmental regulations could impact the way a company's products compare to those of its competitors.

Question 37

What is a supply chain?

Answer 37

A supply chain is a complex logistics system and interconnected journey that raw materials, components, and goods take before their assembly into finished products, sales, and distribution to end customers or consumers. All supply chains begin with a supplier, and even they may have sub-suppliers who gather the raw materials, a haulier and a customer, whether this is an organisation themselves or their own customers.

Question 38

What are the 5 core modes of transport and give an example of each?

Answer 38

- Road: trucks - Water: vessels - Rail: trains - Air: planes - Other: pipes

Question 39

What are the different contexts of a supply chain?

Answer 39

HR vs ILN vs SCT

Question 40

Is there any variation or difference in supply chains?

Answer 40

SCM's supply chain difference completely to the needs of NA College, who provide a service rather than a product.

Question 41

Who are the key personnel and what are their roles?

Answer 41

- Admin staff - Production staff - Hauliers - Shipping / port agents - Warehouse staff - Airport staff - Truck drivers / pilots / ships crew - Logistics planners

Question 42

What is the impact if things going wrong?

Answer 42

- Delays - Backlog - Allocation of parts - Political sanctions