Unit 3

Question 1

What is a mission statement ?

Answer 1

Brief written statement of the purpose of a company or organisation

Question 2

What does a mission statement do ?

Answer 2

Overall goal
Clear direction
Guides decision

Question 3

What are the advantages of a mission statement?

Answer 3

Focus
Motivates
Attracts people/resources 
Public relation
Clarifies purpose

Question 4

What are the disadvantages of mission statement?

Answer 4

Vague
PR exercise
Needs to be supported by management
States obvious

Question 5

What is a stakeholder?

Answer 5

Someone who is affected by a business decision

Question 6

Name examples of a stakeholder

Answer 6

Shareholders
Community
Employees
Owners
Managers
Customers

Question 7

What is culture?

Answer 7

Shared business values and day to day behaviour

Question 8

Examples of culture

Answer 8

How guests are looked after
Recruitment process
Delegation
How long staff in the company

Question 9

Signs of a strong culture

Answer 9

Staff understand culture
Little or no policies
Consistent
Culture embedded

Question 10

Signs of a weak culture

Answer 10

Inconsistent
Little alignment with values
Extensive bureaucracy and procedures

Question 11

Importance of culture

Answer 11

Decision making
Organisation
Motivation
Management control
Recruitment 
How customers are treated
Actions towards external stakeholders

Question 12

What is a power culture?

Answer 12

Control comes within
Autocratic
Swift decisions
Smaller organisation

Question 13

What is a role culture?

Answer 13

Bureaucratic
Delegated authorities
Power from position
Highly defined structure

Question 14

What is a task culture?

Answer 14

Lasses fire
Teams to solve problems
Power by ability
Matrix organisation

Question 15

What is a person culture

Answer 15

Individual power
Own boss
Eg doctor

Question 16

What is the decision making process?

Answer 16

Identify objective
Collect info
Analyse
Decide what action
Communicate 
Outcome
Evaluate

Question 17

What is a strategic decisions?

Answer 17

Bigger plans for future. The bigger picture

Question 18

What is an operational decision?

Answer 18

Everyday low risk decisions

Question 19

What is a tactical decision ?

Answer 19

How your strategic decision will be carried out and achieved

Question 20

What are the internal restraints ?

Answer 20

Company policies
People’s behaviour
Availability finance

Question 21

What are external restraints ?

Answer 21

Economy
Legalisation government
Competitors
Lack of technology

Question 22

What is SWOT?

Answer 22

Strength
Weaknesses
Opportunity
Threats

Question 23

What is the purpose SWOT?

Answer 23

Define goals
Capability
Overcome weaknesses
Threats turn into opportunity

Question 24

What are the advantages of SWOT?

Answer 24

Easy to understand
Identifies weaknesses
Helps set aims
Understand business
Identify potential threats

Question 25

What are the disadvantages of SWOT?

Answer 25

``` Doesn't provide solution Doesn't prioritise Doesn't account for changes in external factors Too much info given Can generate too many ideas ```

Question 26

What are the 5 forces of porters 5 forces?

Answer 26

``` Competitive rivalry Threat of substitute Threat of new entry Buyer power Consumer power ```

Question 27

What does porters 5 forces do ?

Answer 27

Overview of an industry Competitive advantage Who has the power or control Profitability

Question 28

What is organic growth

Answer 28

Increasing turnover of its business | Growth internally

Question 29

Why businesses grow ?

Answer 29

Increased sales Higher employment Increased economies of scale Achievement

Question 30

How they grow?

Answer 30

New shops Bigger range Increase output More staff increases productivity

Question 31

What is external growth ?

Answer 31

Growing through acquiring other business such as takeovers and mergers

Question 32

What is a de-merger?

Answer 32

Company splitting apart

Question 33

What is management buyout?

Answer 33

Managers buy out directors

Question 34

What is a friendly takeover

Answer 34

Company takeover where the company agrees and is happy

Question 35

What is a hostile takeover

Answer 35

Taken over where company is unhappy . By owning majority of shares. Not consented

Question 36

Why change happens?

Answer 36

``` New technology Competition Change in consumer taste Change in the law Labour market Economic conditions ```

Question 37

The effects of change

Answer 37

Shorter product life cycle Skill mismatch Lower brand loyalty

Question 38

The response to change

Answer 38

``` Seek commitment Research and development Expenditure HRM expenditure Capital investment ```

Question 39

What is the problem of change

Answer 39

Resistance Financial problem Lack of expertise

Question 40

What factors can minimise risk?

Answer 40

``` Planning Communication Location Insurance Backup for power and data Security Emergency funds ```

Question 41

The 4 areas of risks with change

Answer 41

Size Speed Culture Managing resistance

Question 42

What is the problem with the size of a business with risk

Answer 42

Bigger the business less flexible and less adaptable

Question 43

What does spiced stand for

Answer 43

``` Strong Pound Imports Cheap Export Dear ```

Question 44

What happens to imports is there is a fall in the exchange rate

Answer 44

Bad Reduced profit margin Increase prices to cover costs

Question 45

What happens to exports if the exchange price falls

Answer 45

Good Cheaper More units sold More revenue =more profit