Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Le Go > 10 - Strategic choices > Flashcards

10 - Strategic choices Flashcards

1
Q

What is required to be carried out prior to the development of strategy?

A

Understanding of the organisation as it stands now through research and development activities
(such as research into business environment and competition)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

2 variables to manipulate when looking at strategic direction

A

Products/services

Customers (markets)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Ansoff’s product/market grid - explain/draw diagram

A
  • Products/services on top (existing on left column, new on right column)
  • Markets on left (existing on top row, new on bottom row)
  • Top left = market penetration
  • Top right = product development
  • Bottom left = market development
  • Bottom right = diversification
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Ansoff’s product/market grid - what does it capture?

A

That there are two variables an org can manipulate when moving to future - products/services and customers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Why does Ansoff’s product market grid no longer have lines separating quadrants?

A

4 different aspects are more malleable than boxed lines indicates

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Ansoff product/market grid - market penetration

A
  • Growth through increase of market share in current product/market mix
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

2 forces restricting growth through market penetration (product/market grid)

A
  • Retaliation from competitors
  • Legal restrictions on monopolistic dominance
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Ansoff product/market grid - product development

A

Using the knowledge of the existing customer base and markets to provide different, evolved or complementary products

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Ansoff product/market grid - market development

A

Taking existing products or services into new markets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What is often required prior to market development (product/market grid)

A

Significant pre-emptive market and consumer research, possibly some product development to tailor existing product

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Ansoff product/market grid - 4 types of diversification

A

Horizontal diversification

Vertical diversification

Concentric diversification

Conglomerate diversification

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Ansoff product/market grid - diversification - horizontal diversification

A

New product marketed to customers of competitors

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Ansoff product/market grid - diversification - vertical diversification

A

Org acquires new supplier or customer to broaden depth and breadth of commercial control

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Ansoff product/market grid - diversification - concentric diversification

A

New closely related product introduced by an org, often times to support sale of existing product and vice versa

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Ansoff product/market grid - diversification - conglomerate diversification

A

Completely new and unrelated products introduced by org wishing to take advantage of its markets

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Why is diversification the highest risk option within Ansoff’s product/market grid?

A

It requires significant research and market intelligence in terms of both aspect of development

17
Q

What is a strategic business unit (SBU)?

A

A grouping of certain areas/subsidiaries within one organisation, often due to location or customer/supplier focus

18
Q

Classic definition of an SBU

A

A fully functional unit of a business with its own vision and direction, operating as a separate unit but often still reliant upon the organisational centre for ultimate direction

19
Q

2 benefits of creating formal SBUs

A
  • Focused and aligned strategy
  • Agility to react quickly in decision-making
20
Q

Porter - 3 fundamental methods to achieve competitive advantage

A
  • Lower costs
  • Differentiation
  • Focus - particular area of market (age, wealth, geography) or broad scope
21
Q

What is meant by being a cost leader in an industry/sector?

A

Becoming the lowest cost organisation while maintaining quality - there can only be one!

22
Q

4 key cost drivers to take into consideration when aiming to be cost leader

A

Input costs - need to minimise cost of labour and raw materials

Economies of scale - reduction of fixed costs through greater quantities

Experience - cumulative experience and knowledge of people can ensure efficiency

Design - efficiency can be built into the core design of product/process

23
Q

3 risks of cost leadership - causes of failure

A
  • Restricted and insufficient supply base that is shared by all competitors
  • Easy imitation of strategy by competitors
  • Detriment in quality due to cheaper supplies
24
Q

Financial benefit of product differentiation

A

Charging a price premium

25
Q

Garvin - 8 dimensions of differentiation quality

A

Performance
Features
Reliability
Conformance
Durability
Serviceability
Aesthetics
Perceived quality

26
Q

5 natural dangers of pursuing strategy focused on differentiation

A
  • Too much differentiation causing confusion
  • Too high a price premium
  • Easy imitation by competitors
  • Differing perceptions of the meaning of quality between buyers and sellers
  • Striving for a uniqueness that fails to bring sufficient added value
27
Q

What is the aim of strategic focus? (competitive advantage)

A

To achieve competitive advantage by giving a better service to target customers than which is achieved by competitors who are aiming for a broader customer base

28
Q

What should management focus on after deciding how the org is to gain or maintain competitive advantage?

A

How to design and implement the strategy to achieve the required objectives

29
Q

Differentiate between business level and corporate level

A

Business level refers to single business operating within defined boundary
Corporate level refers to a number of businesses operating within a wider boundary

30
Q

What does portfolio analysis involve?

A

The grouping together of a range of similarly performing products (or businesses) to help decision-makers consider where best to build their organisation or business

31
Q

BCG (Boston consulting group) approach to portfolio analysis - draw or explain diagram

A
  • Market share on top (High on left column, Low on right column)
  • Market growth on left High on top row, Low on bottom row)
  • Top left = STARS - cash neutral
  • Top right = PROBLEM CHILD - cash user
  • Bottom left = CASH COWS - cash generator
  • Bottom right = DOGS - cash neutral
  • cash generator/user is in relation to that org
32
Q

Benefit of BCG (Boston consulting group) model

A

Plot and monitor movement of different products between four statements, and to analyse how this aligns with the product lifestyle

33
Q

Lynch - 3 difficulties with BCG matrix

A
  • Defining market growth and understating what is perceived as high or low
  • Defining market itself
  • Understanding what is meant by relative market share
34
Q

4 potential drivers of internationalisation as a business strategy

A

Market drivers - potential customer reach of expansion

Cost drivers - reduction of operational costs

Government drivers - potential gov support to enable international operation

Competition drivers - development and maintenance of competitive advantage may require an organisation to develop its markets. if it is dealing with international customers, then it is likely that it will need to also develop an international strategy.

*note on competition drivers - not sure if this makes sense but is from textbook and used in model answer.

Le Go (21 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions