Theme 3 Flashcards
(82 cards)
What are corporate objectives? (1)
Goals set by senior management to achieve over time, derived from the business’s mission statement
How does a mission statement relate to corporate objectives? (1)
A mission statement expresses the company’s purpose and guides the development of corporate objectives.
What does Ansoff’s Matrix focus on? (1)
Strategies for business growth based on existing or new products and markets.
What are the four strategies in Ansoff’s Matrix? (4)
Market Penetration: Selling more to existing customers.
Market Development: Selling existing products in new markets.
Product Development: Creating new products for existing customers.
Diversification: Entering new markets with new products.
What does Porter’s Strategic Matrix help businesses determine? (1)
It helps choose strategies based on cost leadership, differentiation, and market scope.
What are the three strategies in Porter’s Generic Strategic Matrix? (3)
Cost Leadership: Competing on lower costs.
Differentiation: Offering unique products.
Focus: Targeting a specific market niche.
What is the aim of portfolio analysis? (1)
To evaluate a company’s product range and decide which products to develop, invest in, or discontinue.
How do distinctive capabilities contribute to competitive advantage? (1)
They are unique strengths, like expertise or reputation, that are difficult for competitors to replicate.
How do strategic decisions affect human resources? (3)
Can lead to staff recruitment or layoffs.
Might require retraining or relocation of employees.
May create new opportunities for promotion.
How do strategic decisions affect production resources? (3)
May need new production equipment or modifications
May need more capacity or factory space.
Can lead to changes in product design or production methods.
How do strategic decisions affect financial resources? (3)
May need increased investment in marketing or new products.
Can require funding for expansion.
Might generate funds by selling underperforming assets.
What are strengths in a SWOT analysis? (1)
Internal capabilities that give the business an advantage over competitors.
What are weaknesses in a SWOT analysis? (1)
Internal factors that limit the business’s performance or competitiveness.
What are opportunities in a SWOT analysis? (1)
External factors that the business can exploit for growth.
What are threats in a SWOT analysis? (1)
External challenges or risks that could harm the business.
What is the purpose of PESTLE analysis? (1)
To evaluate the external factors (political, economic, social, technological, legal, environmental) affecting a business’s strategy.
How does the competitive environment impact business strategy? (1)
Businesses must adapt their strategies to respond to changes in competition, market conditions, and consumer behavior.
What does Porter’s Five Forces model analyze? (1)
Industry competitiveness by assessing the impact of five factors:
new entrants,
supplier power,
buyer power,
substitutes,
and rivalry.
What are the objectives of business growth? (4)
Achieve economies of scale (internal and external)
Increase market power over customers and suppliers
Increase market share and brand recognition
Increase profitability
What problems can arise from business growth? (3)
Diseconomies of scale
Internal communication issues
Overtrading
What are reasons for mergers and takeovers? (4)
Achieve faster growth
Access new markets or products
Gain synergies (cost savings)
Eliminate competition
What are problems of rapid growth? (2)
Cultural clash
Financial risks
What is time-series analysis?
A method to predict future sales based on past trends using data over time.
How are moving averages calculated? (1)
Average sales over 3 periods (3-period) or 4 quarters (4-quarter) to smooth fluctuations
