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Business Theme 3 > Mrs Bird > Flashcards

Mrs Bird Flashcards

1
Q

What are mission statements?

A

A mission statement is a brief description of a businesses purposes, values and intentions.

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2
Q

Give 3 BENEFITS and 3 DRAWBACKS of Mission Statements.

A

BENEFITS
-Gives a direction for the business
-Motivation for employees
-Guides managers Objectives (SMART)

DRAWBACKS
-can be vague (fit for any competitors business)
-people don’t even care much
-may not actually express the business purpose

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3
Q

What are Corporative Objectives?

A

Corporate Objectives are specific and measurable goals usually set by senior management to achieve aims within the business and aimed at satisfying shareholders.

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4
Q

What does SMART stand for?

A

S-Specific
M-Measurable
A-Achievable
R-Relevant
T- Time related

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5
Q

What are Corporate Strategies?

A

Corporate strategies are medium to long term plans for achieving corporative objectives

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6
Q

When talking about the environment, what can you mention?

A

-Competitors
-Mass/Niche
-Customer Types
-Legislations

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7
Q

What does the Ansoff Matrix measure?

A

Measures the Risk of a decision on a product level.

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8
Q

Name each component of the Ansoff matrix and label the most riskiest and the least riskiest.

A

Market Penetration (least risky)
Market development
Product development
Diversification (most risky)

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9
Q

Name each component of the Ansoff matrix and label the most riskiest and the least riskiest.

A

Market Penetration (least risky)
Market development
Product development
Diversification (most risky)

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10
Q

What is Market Penetration and how can it be achieved?

A

Market Penetration is about selling more of existing products to existing customers.
This can be achieved through discounts and advertisements.

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11
Q

What is Product Development how can it be Achieved?

A

Product Development is about creating new products for existing markets and customers and can be achieved by launching new products.

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12
Q

What is Market Development and how can this be achieved?

A

Market Development involves selling existing products to new markets and can be achieved by expanding into new geographic regions.

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13
Q

What is Diversification and how can it be achieved?

A

Involves creating new products for new markets which can be achieved by developing new markets which can be achieved by developing new products that are unrelated to existing products.

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14
Q

Give 3 Benefits of Ansoff Matrix.

A

-Good tool for comparing risks.
-Helps managers decide the direction for growth
-useful for small/medium business looking to grow.

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15
Q

Give 3 LIMITATIONS of Ansoff Matrix

A

-Can’t just rely on Ansoff as there are many other factors to consider. E.g finance of the business, shareholders etc.
- Doesn’t consider competitors.
-Doesn’t quantify the complications in each strategy.

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16
Q

What is Porters Generic Strategies?

A

Ways a business can compete successfully in the market to stand out from competitors.

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17
Q

Name each segment from Porters Generic Matrix

A

-Cost leadership
-Cost focus
-Differentiation leadership
-Differentiation Focus

18
Q

What is Cost Leadership? (+ example)

A

Cost Leadership is when a business tries to be the cheapest in the market by reducing its costs and offering lower prices than competitors. Usually associated with large scale businesses.
Example: Walmart.

19
Q

What is Cost Focus? (+ Example)

A

Cost Focus is when a business targets a specific group of customers and offers the lowest price just for them. The products tend to be basic and “dupes” (own brand replicas/ off brand replicas)
Example: Aldi.

20
Q

What is differentiation Leadership? (+ Example)

A

Differentiation Leadership is when a business makes its product unique or special compared to competitors, so customers are willing to pay more. Targets larger markets and aims to achieve competitive advantage.
Example: Apple.

21
Q

What is Differentiation Focus? (+ Example)

A

Differentiation Focus is when a business targets a specific group of customers and offers them unique/ specialised products of a marker segment. Clearly different to competitors.
Example: Rolls Royce.

22
Q

How can a business DIFFERENTIATE?

A

-quality
-innovation
-Branding
-USP
-exceptional service
-Exclusivity
-Design Mix

23
Q

How can a business compete with COSTS?

A
  • Economies of scale
    -Cheap Suppliers
    -Lower costs of production- Just In Time, Lean manufacturing
    -Reducing Staff
    -outsourcing (pay another company to do it for you)
24
Q

What are the limitations of being “Stuck in the middle”

A

-expensive
-time consuming
-mixed branding
-mixed messaging

25
What are the USES of the BOSTON MATRIX?
-Helps businesses analyse future opportunities or problems with their product portfolio. -A good starting point when reviewing an existing product line to decide future strategy and budgets.
26
What are the LIMITATIONS of a BOSTON MATRIX?
-high market share and high growth rates may not always lead to high profitability as there are high costs also involved. -The market is not clearing defined in this model as the 4-celled approach is considered to be too simplistic.
27
What are the LIMITATIONS of a BOSTON MATRIX?
-high market share and high growth rates may not always lead to high profitability as there are high costs also involved. -The market is not clearing defined in this model as the 4-celled approach is considered to be too simplistic.
28
Name 2 reasons on WHY businesses keep a DOG?
-heritage - Kelloggs with cornflakes. -to complete a set/range - tablespoons in cutlery.
29
What are Kay’s 3 Distinctive Capabilities?
- Reputation -Architecture -Innovation
30
What is Reputation and the impact on Customers?
-the brand identity, built through factors such as high quality -the brand promise you will give to your customers (strap line) -the reputation in the market Positive reputation builds and sustains customer trust and loyalty.
31
What is architecture and the impact?
This refers to the unique relations and network a company has built overtime. These relationships include connections between suppliers, employees and customers. If a business has a strong architecture this means the business will average a strong competitive advantage as it’s hard for competitors to replicate the relations.
32
What is innovation and why is it useful?
A companies ability to create new products, services or business models. It is useful as it helps keep the business ahead of the competition.
33
What is a STRATEGIC DECISION?
-long term direction of the business -what the business will do to meet its aims and objectives -pro active decision making -Forward thinking, future planning
34
What is a STRATEGIC DECISION?
-long term direction of the business -what the business will do to meet its aims and objectives -pro active decision making -Forward thinking, future planning
35
What is a TACTICAL DECISION?
-short term or medium term decisions -how the business will implement its strategy -reactive to competitors actions -present day thinking, what is happening now that needs dealing with.
36
What is a TACTICAL DECISION?
-short term or medium term decisions -how the business will implement its strategy -reactive to competitors actions -present day thinking, what is happening now that needs dealing with.
37
What is SWOT ANALYSIS?
Involves looking at internal strengths & weaknesses, external opportunities &threats of a business.
38
How can SWOT be used as a strategic tool?
-businesses can maximise external opportunities -businesses can plan for external threats - E.G competitors, Legislations -business will be aware of weaknesses and can either change it or mitigate against it.
39
Give 2 Examples each for S.W.O.T
2 internal strengths: highly motivated work force, loyal customer base 2 internal weaknesses: poor cash flow, bad organisation structure 2 external opportunities: Fall of raw materials, changes in exchange rates 2 External threats: new entrant to market, recessions
40
What does PESTLE stand for ?
Political Economic Social Technological Legal/legislation Environment
41
What should a business examine in relation to external POLITICAL influences?
A business should examine how they may be affected by: -a change in government- new or established -tax rates (increased VAT) (15% on companies) -Tariffs (when importing into the UK)
42
What should a business analyse in relation to external ECONOMIC influences?
A business should analyse how they may be affected by: An increase in interest rates An increase in inflation Unemployment rates The business cycle Recessions

Business Theme 3 (1 decks)

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