3.1 - Business Objectives & Strategy Flashcards
Corporate
A body of people working together.
Critical appraisal
Process of assessing the outcomes of research to judge its trustworthiness and value.
Mission Statement
Sets out the purpose of a business.
- Values of the business
- The scope of the business (Areas it operates)
- Long-term aims
Corporate Objectives
Determines the mission of a business
- Includes setting measurable targets for the whole organisation.
Functional Objective
Departmental objective which helps the business achieve its mission.
Hierarchy of Business Objectives
- Mission Statement
- Corporate Objectives
- Departmental/Functional Objectives
Corporate Strategy
Unique plan or framework that is long-term in nature, designed to gain a competitive advantage over other market participants while delivering both on client and stakeholder promises.
Benefits & Drawbacks of a mission statement
Pros:
- Focus
- Profit (Motivating employees, efficiency)
- Identity (of the business)
Cons:
- Can be unrealistic
- Can be a waste of time & resources
- Ambiguous
SWOT Analysis
Strengths, weaknesses, opportunities and threats.
Method of identifying internal strengths and weaknesses of a business.
What is Ansof’s matrix?
Marketing tool that looks at different markets and products to determine which has the greatest risk & value.
- Cost leadership (Company that projects its self as the cheapest in the market) - Existing product & Service
- Differentiation (Unique product or USP) - New Product & Service
- Product Development (Developiing your current product/service) - New Product & Existing market
- Market Development (Entering new markets) - Existing Product & New market
Benefits of Porters Strategic matrix
- Establishes a clear direction for the business
Describe the Boston Matrix
Star
- High Market share & High Growth market
Cash Cow
- High Market share & Low growth market
Question Marks
- Low Market share & High growth market
Dogs
- Low market share & Low growth market
(Kay’s distinctive Capabilities)
3 factors that can lead to a sustainable competitive advantage.
- Architecture (Relationships within a business that create understanding between suppliers, customers & employees)
- Reputation (Brand values are hard to replicate & may take years to develop)
- Innovation (Process of developing unique products & processes which can sometimes be patented.
What does PESTLE stand for? And what is it?
Political, Economic, Social, Technological, Legal & Environmental.
They are external factors
What are Porters 5 forces & what is the purpose?
To help businesses make strategic decisions by understanding the competitive dynamics of an industry. (Are new products/services going to be proftable?)
- New Entrants
- Customers
- Substitutes
- Suppliers
- Rivalry
