chap 8 - strategy

Question 1

swot and pest analysis

Answer 1

strength , weakness, opportunity & threats- helps with business short, med long term plans, how can the firm beat competitors, values, expectation and influence in outside business?

swot often supported by PEST, political, economic, social, technological- it is an analysis of the market place in which the firm works and the key factors of driving chang

Question 2

typical outcomes of strategic review

Answer 2

1. defining business ‘vision’
2. creating a mission statement
3. making a transformational acquisition
4. entering a new business sector
5. investing in business that has shown great growth

Question 3

ousourcing why, +’s and -‘s

Answer 3

to save money, outsourced often to low cost locations, contractor gains efficinecy from specialisation & from economies of scale
outsourcing allows companies to focus on core competancies
disadvantages
1. loss of managerial control
2. loss of hey jo support (service within strict parameters only)
3. hidden costs
4. threat to intellectual property, security, confidentiality
5. quality
6. exposure to solvency of the outsourcing contractor- outsourcers potential failure needs to be built into the risk profile
7. bad publicity
8. client r.ships- increased risk of poor service

Question 4

requirements for successful outsourcing

Answer 4

lets understand what we dont understand and be clear in our competitive advantage - nike

Question 5

how to ensure IT serves the business

Answer 5

1. needs of the business
2, planning
3. mangement
4. implementation
5. solutions

Question 6

segmentation - criteria for success?

Answer 6

1. is the segment measurable?
2. is the segment viable (profitable)
3. do members of the segment have sufficient characteristics in common to make them distinct
4. is the segment accessible
5. is the segment already well served by competirors- is the segment growing?
6. what investment is needed for expertise and resources- how will segmentation fit within the existing structure
7. to serve the segment does the firm need to organise itself around it or can it be donevirtually

Question 7

+’s and -‘s of segmentation / specialisation

Answer 7

+’s

1. improved differentiation from competitors- increased market share
2. greater recognition and brand awareness
3. greater productivity/efficiency
4. possible economy of scale by serving customers in same way
5. attraction/retention of skilled employees
6. creating new opportunities by discovering inadequately served segments

• ’s
  1. specialising staff can be costly
  2. some clients may object to be handled alongside similar clients
  3. creation of specialist areas may lead to staff unhappiness
  4. demand for more or less automony
  5. not everything can be segmented - potential rumps
  6. investment needed

Question 8

organisational structures

Answer 8

1. total quality management
2. business processing re-engineering (flatter mngmt structures)
3. lean (eliminate waste)
4. matrix and practice based structures- hierarchial org but functional tasks given
5. practice structure
6. centralisation of functions
7. decentralisation
8. change management
9. global/strategic business units
10. employee empowerment

Question 9

types of management information

Answer 9

1. financial (budgets, forecasts, revenue, debtors)
2. business targets (won to lost ratio, retention ratio, new business pipeline, hit rate of new business)
3. shareholders (staff turnover, staff surveys, prem volume by insurer, client at risk _ RAG

Question 10

using management information

Answer 10

1. weekly (calls, support initiatives)
   2, monthly (senior exec meetings)
   3, bi annually (meetings for a longer review and act accordingly)
2. annually (planning and strategy reviews)