3.1.2 corporate strategy

Question 1

strategy

Answer 1

strategy’s are the plans for a business to achieve its objectives

Question 2

corporate strategy

Answer 2

the overall plan on how to acheieve a businesses overall objectives

Question 3

product portfolio

Answer 3

this is the complete collection of all the products a business sells

Question 4

what is porters strategy matrix

Answer 4

a matrix showing 4 simple strategys a business may use to position itself in a market. it shows that a business may gain a competitive advantage by being low cost or differentiate

Question 5

what are the 4 categorys in porters matrix

Answer 5

Cost Leadership Strategy
Differentiation Strategy
Cost Focus Strategy
Differentiation Focus Strategy

cost leadership- aiming to be the lowest cost in a large market
cost focus- aiming to be lowest cost in a small market
differentiation leadsership- being the most unique in a large market
differentiation focus- being the most unique in a small market

Question 6

what is the focus vs leadership in porter’s matrix

Answer 6

focus is a niche market and leadership is in a mass market

Question 7

product differentiation

Answer 7

the way a business will make a product stand out from competition

Question 8

evaluation of porters matrix

Answer 8

a business will need to decide whether they will make a profit from being low cost, and also need to decide whether the product differentiation will appeal to customers

Question 9

how can a business differentiate a product

Answer 9

-being high quality
-being ethical
-brand which standout

Question 10

ansoff matrix

Answer 10

this is a tool for a business which has the objective of growth, it sets out 4 ways of growing and the risks associated with each one. it considers new and exisiting products and new and existing markets

Question 11

what are the 4 categorys in the ansoff matrix

Answer 11

market penetration
market development
product development
diversification

market penetration=this involves boosting market share and sales of an existing product in an existing market (low risk)
market development= selling existing products to new market such as in foreign country’s (medium risk)
product development= selling new products in existing markets (medium risk)
diversification= selling new products in new markets (high risk)

Question 12

what are the advantages and disadvantages of market penetration

Answer 12

-low risk
-can be relatively cheap
-you know the market already so it should be a success

-will not have high margins compared to other strategys
-lack of ambition

Question 13

what are the advantages and disadvantages of market development

Answer 13

-can open products to large new consumer population which can significantly boost sales
-huge potential EOS

-a new foreign country may not want the product
-business might not understand consumer behaviour in new market (reduce this risk by market research)

Question 14

what are the advantages and disadvantages of product development

Answer 14

-new products can help boost brand recognition
-increased sales

-more storage and resoruces needed for new products can be expensive
-might fail due to design problems or failure to meet customer needs.

Question 15

what are the advantages and disadvantages of diversification

Answer 15

-it can come with high profit margins iof successful
-high risk high reward

-a business may find it hard to understand new product and new market and may be a failure

Question 16

distinctive capability

Answer 16

When a business has a particular strength that is very difficult for competitors to copy, it has a distinctive capability

Question 17

how to gain a competitive advantage through distinctive capabilities

Answer 17

expertise and staff skills- product development will be easy
good communication and relationships- good communication with suppliers can lead to lower cost materials
reputation and image- excellent reputation can allow a business to differentiate
ability to innovate- responding to external change quick can be beneficial