3.1.2 theories of corporate strategy Flashcards

1
Q

define corporate strategy

A

a medium to long term plan for meeting company wide objectives

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2
Q

porters strategic mix

A

suggested three generic business strategies to get competitive advantage

cost leadership, differentiation, focus

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3
Q

cost leadership - porters strategic mix

A

making products at the lowest cost

outsourcing, lean management,

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4
Q

differentiation - porters strategic mix

A

products or service is unique and the USP adds value to the product

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5
Q

focus - porters strategic mix

A

product or service will serve a very small specific niche
high costs passed onto customers

no close substitutes

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6
Q

Boston matrix

A

marketing planning tool to help managers plan for a balanced product portfolio

cash cow, star, dog, question mark

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7
Q

Boston matrix - question mark

A

high market growth, low market share

products just launched on the market, building customer loyalty

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8
Q

Boston matrix - cash cow

A

reaching maturity of product life cycle

still have customer loyalty

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8
Q

Boston matrix - star

A

high market share, high market growth

growth phase of product life cycle

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9
Q

Boston matrix - dog

A

declining sales in declining markets

decline phase of product life cycle

product should be removed from sale

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10
Q

Boston matrix uses

A

market share is compared against large competitors

helps business analyse future opportunities or problems with products portfolios

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11
Q

Boston matrix limitations

A

market is not clearly defined in this model

high market share doesn’t always lead to high profits

high costs involved with high market share

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12
Q

define kays distinctive capabilities

A

a strength a business has that other businesses cannot easily copy

provides a competitive advantage

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13
Q

kays 3 distinctive capabilities

A

architecture - relationships with employees, suppliers, customers

reputation - through the customer experience

innovation - bringing inventions to market

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14
Q

strategic decisions

A

long term direction of business

what the business will do to meet aims and objectives

pro-active decision making
forward thinking, future planning

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15
Q

tactical decisions

A

short or medium term decisions

how the business will implement its strategy

reactive to competitor actions

16
Q

ansoffs matrix

A

market penetration
market development
product development
diversification

17
Q

market penetration

A

aims to increase market share by concentrating on existing products in existing markets

most common and safest as it does not stray from what the company knows best

18
Q

market development

A

finding new markets for existing products

more risky as making a step into the unknown

19
Q

product development

A

launching new products into existing markets

1 in 7 new products succeed

used often in highly competitive markets to stay ahead of the competition

20
Q

diversification

A

a new product in a new market

riskiest of all strategies

can be incredibly successful