2 Theories of Corporate Objectives Flashcards
Define Ansoff’s matrix
Ansoff’s Matrix identifies four strategies and the relative risks associated with these strategies.
Name Ansoff’s Matrix’s four strategies
- market development
- market penetration
- product development
- diversification
Define market development
aims to achieve growth in new markets with existing products.
Define market penetration
aims to achieve growth in existing markets with existing products.
Define product development
aims to achieve growth in existing markets with new or modified products.
Define diversification
aims to achieve growth in new markets with new products.
Define Porter’s Strategic Matrix
aims to identify the sources of competitive advantage that a business might achieve in a market
Name Porter’s Strategic Matrix options
- cost leadership
- differentiation
- focus strategy
Define cost leadership and differentiation strategy
Cost leadership involves striving to be the lowest-cost provider in the market
Differentiation involves a business operating in a mass market with a unique position in order to stand out from competitors.
Define Boston Matrix
a method of portfolio analysis based on market share and market growth, it categorises products into stars, cash cows, dogs and question marks.
Define portfolio analysis
involves a business considering each of its products in the context of its market position.
Define tactical decisions
a short term response to a opportunity or threat in a market
Define strategic decisions
set out the long term direction that a business will take to achieve its objectives
Define corporate strategy
plans and policies developed to meet a company’s objectives
Define customer base
a group of customers that make continual repeat purchases from a business
