Ch7 Analyzing the Business

Question 1

SWOT analysis

Answer 1

A SWOT analysis looks at the Strengths and Weaknesses of the company itself and the Opportunities and Threats for the company in its external environment.

Question 2

Porter’s five forces model

Answer 2

a model that focuses on the five forces that shape competition within an industry. (substitute products, supplier power, buyers, competitive rivalry and threat of new competition)

Question 3

industry life cycle model

Answer 3

a useful tool for analyzing the effect of an industry’s evolution on competitive forces.

Question 4

vision statement

Answer 4

a clear, concise picture of the company’s future direction in terms of its values and purpose that is used to guide and inspire.

Question 5

mission statement

Answer 5

a clear, concise articulation of how the company intends to achieve its vision-how it is different from its competition and the keys to its success.

Question 6

pro forma financial statements

Answer 6

projected financial statements of future values.