3.7 analysing the strategic posisiton of a business

Question 1

strategy and tactics

Answer 1

strategy - long term plan, designed to achieve corporate objectives, commit most of the businesses resources
tactics - short term, responding to threat and opportunity, commit less resources, day to day

Question 2

strategic

Answer 2

mission statement
vision and values
organisational culture
business plan
growth strategy
market positioning

Question 3

tactical

Answer 3

marketing mix
financial and non financial rewards
inventory management
location decisions
day to day customer service

Question 4

swot

Answer 4

helps a business assess its competitive strength and the nature of its external environment

Question 5

strengths and weaknesses

Answer 5

competitive advantages
benchmarking business against others
key performance indicators

Question 6

evidence of strength and weakness

Answer 6

market share
profitability
efficiency
brand loyalty
market capitalisation
reputation for quality

Question 7

evaluating strengths and weaknesses

Answer 7

only focus on most important
sustainability of the strengths

Question 8

pestle, external, opportunity and threat

Answer 8

political
economic
social
technological
legal
environmental

Question 9

why might ratio data not be entirely reliable

Answer 9

financial information involves making subjective judgements
different business have different accounting policies
potential for manipulation of accounting info, making it look better than it was
compare ratio with other businesses
market conditions change

Question 10

what ratios don’t show

Answer 10

brand strength
quality
ethical
future prospects
changes in external environment

Question 11

ratios overall

Answer 11

very useful, widely understood
don’t solve issues only find them

Question 12

core competences

Answer 12

something unique that a business can do strategically well
links with strength in SWOT

Question 13

core competencies are

Answer 13

provide consumer benefits
hard to imitate
can be leveraged widely to support many products and markets

Question 14

examples of core competencies

Answer 14

ikea - innovative design capabilities
apple - design built around user
dominos - integrating multi channel systems
Starbucks - localised customer experience

Question 15

busines implications of urbanisation and migration

Answer 15

rising population, higher demand
public services, pressure on public services/nhs, however helps businesses grow having a larger supply of labour

Question 16

CSR

Answer 16

the extent to which businesses addresses concerns of stakeholders, actions they take above the minimum required to adress social needs

Question 17

factors influencing investment decisions

Answer 17

investment criteria
non financial factors
risk and uncertainty

Question 18

investment criteria

Answer 18

target percentage rate of return/ARR/npv

Question 19

non financial factors

Answer 19

corporate objectives - does the investment support the business objective
business attitude to risk taking

Question 20

risk and uncertainty

Answer 20

attitude to risk, contingency planning and sensitivity analysis can help problems created by uncertainty

Question 21

sensitivity analysis

Answer 21

analysing the effect of changes in assumptions used in forecast
which assumptions are most significant to the forecast

Question 22

assumptions/ business forecast

Answer 22

cash flow forecasts
budgets
investment appraisal
break even

Question 23

benefits of sensitivity analysis

Answer 23

identifies most significant assumptions
helps assess risk and prepare for a less favourable scenario

Question 24

sampling

Answer 24

random
systematic
stratified