Theme 3

Question 1

Mission Statement

Answer 1

Set out an organisations purpose and aims

Question 2

Corporate objectives

Answer 2

Set by senior management to help a firm achieve its mission statement and aimed at satisfying shareholders

Question 3

Critical appraisal

Answer 3

The purpose of the mission statement and their intended audience are often considered in appraisal

Question 4

Corporate Timescales

Answer 4

Strategy and the expectation of when a return will be achieved

Question 5

Short-termism

Answer 5

Businesses focused on quick financial reward at the expense of investment

Question 6

Long-termism

Answer 6

Business focused on sustained growth where CSR and ethical behaviour are considered

Question 7

Business Ethics

Answer 7

Moral principles that guide the way a business behaves

Question 8

Remuneration

Answer 8

Reward for employment in form of pay

Question 9

Corporate Social Responsibility (CSR)

Answer 9

Company should consider the environmental, workplace and social impact of business decisions

Question 10

Corporate Culture

Answer 10

Norms and values of a business

Question 11

Strong Cultures

Answer 11

Particularly difficult to change as they are deeply embedded into the ways a firm does things

Question 12

Weak Cultures

Answer 12

Wide range of sub-cultures exist and one dominant culture isn’t very embedded

Question 13

Stakeholders

Answer 13

Anyone who has an interest in the business or may be affected by the businesses’ activities

Question 14

Internal Stakeholder

Answer 14

Those inside a business who may be affected by corporate decisions

Question 15

External Stakeholders

Answer 15

Those outside a business who are affected by the businesses’ decisions

Question 16

Stakeholder Influence

Answer 16

The business considers all of its stakeholders in decisions/objectives

Question 17

Shareholder Influence

Answer 17

The business should focus purely on shareholder returns (increasing share price and dividends) in its business decisions/objectives

Question 18

Stakeholder Approach

Answer 18

Idea that more profit can be earned in the long-term by a firm looking after their stakeholders e.g good quality service = returning customers

Question 19

Ansoff’s Matrix

Answer 19

Analysis tool that is used to identify the level of risk

Question 20

Porter’s Strategic Matrix

Answer 20

Corporate strategy to help a firm find a competitive advantage

Question 21

Boston Matrix

Answer 21

Analysis tool of a firm’s product portfolio in terms of market share and market growth, used to know when to launch a new product and have a diversified portfolio

Question 22

SWOT Analysis

Answer 22

Tool that is used to make strategic decisions to achieve corporate objectives

Question 23

PESTLE Analysis

Answer 23

Analysis tool that aims to look at external influences that can impact the business

Question 24

Competitive Environment

Answer 24

Dynamic market in which a business competes and functions

Question 25

Non-Competitive Market

Answer 25

Dominated by a single producer (monopoly) or a few large businesses (oligopoly)

Question 26

Porter’s Five Forces

Answer 26

Analyse how a wider range of factors affect the environment a business operates in

Question 27

Business Growth

Answer 27

Business needs to expand and seek options to generate profits