Partial 2 Flashcards
(33 cards)
Aim
The long-term goals of a business, often expressed in the firm’s mission statement. They are a general statement of a firm’s purpose or intentions and tend to be qualitative in nature.
Ansoff matrix
(1957) An analytical tool to devise various product and market growth strategies, depending on whether businesses want to market new or existing products in their new or existing markets.
Corporate Social Responsibility
The conscientious consideration of ethical and environmental practices related to business activity.
Code of ethics
The documented beliefs and philosophies of an organization.
Ethics
The moral principles that guide decision-making and strategy. Morals are concerned with what is considered to be right or wrong, from society’s point of view.
SMART objectives
Targets that are specific, measurable, achievable, realistic and time constrained.
SWOT analysis
Is an analytical tool used to assess the internal strengths and weaknesses and the external opportunities and threats of a business decision, issue or problem.
Joint venture
A growth strategy that combines the contributions and responsibilities of two different organizations in a shared project by forming a separate legal enterprise.
Lateral integration
Unit not yet reviewed.
Merger
Unit not yet reviewed.
Multinational company
An organization that operates in two or more countries, with its head office usually based in the home country.
Optimal level of output
The most efficient scale of operation for a business which occurs at the level of output where average costs of production are minimized.
Backward vertical integration
Unit not yet reviewed.
Conglomerates
Unit not yet reviewed.
Diseconomies of scale
Are the costs disadvantages of growth. Unit costs are likely to eventually rise as a firm grows due to a lack of control, coordination and communication.
Diversification
It is a high risk growth strategy that involves a business selling new products in new markets, i.e. spreading risks over a diverse variety of products and markets.
Economies of scale
It refers to lower average costs of production as a firm operates on a larger scale due to gains in productive efficiency, e.g. easier and cheaper access to finance.
Forward vertical integration
Unit not yet reviewed.
Franchise
Unit not yet reviewed.
Globalization
It is the growing integration and interdependence of the world’s economies, causing consumers around the globe to have increasingly similar habits and tastes.
Horizontal integration
Unit not yet reviewed.
Internal growth
Also known as organic growth, it occurs when a business grows using its own capabilities and resources to increase the scale of its operations and sales revenue.
Inflation
It occurs when the general price level in a economy continuously rises. it is measured by changes in the cost of living for the average household in a country.
Interest rate
It is a measure of the price of money in terms of the amounts charged for borrowed funds or how much is offered on money that is saved.
