TERM 1 - Topic 1.3 - Adapting to challenges of the business environments

Question 1

Explain ACQUISITION

Answer 1

Purchase / acquire by a business (purchasing a small part of example a transport company. This is to reduce the cost of transport)

Question 2

Explain ALLIANCE

Answer 2

Agreement in which 2 or more businesses pool resources to benefit all

(example: businesses agree to to stock one another’s products)

Question 3

Explain TAKEOVERS

Answer 3

Business is entirely taken over by another

Question 4

Explain MERGERS

Answer 4

2 businesses JOIN to form a new business

Question 5

Explain LOBBYING

Answer 5

Attempts to influence business and government leaders to create laws that will benefit them

(example: get tax rebates; don’t pay tax on fresh food)

Question 6

Explain NETWORKING

Answer 6

Business relationships to create business opportunities / share information

(example: share business cards and contact one another with offers)

Question 7

Explain POWER RELATIONSHIP

Answer 7

2 X Powerful parties share a relationship for their OWN gain

Question 8

BEE (Black Economic Empowerment) - what is that?

Answer 8

Law passed by government to
= equalise WORK opportunities
= equalise BUSINESS ownership

Question 9

How does a business adapt to challenges in the macro environment. (9 points - mention a few)

Answer 9

1) Information Management (easy access to info)
2) Strategic Responses (preplanned response for
any eventuality)
3) Mergers (to have a larger share of the market)
4) Takeovers (choose a business that will benefit
your business, bring skills, market share, etc.)
5) Acquisitions (not an entire takeover, you only
buy the part you need)
6) Alliances (pool resources)
7) Organisation design and flexbility (adaps to
changes easily)
8) Direct influence on environment (know the
impact of pollution and use of resources and
adapt when necessary)
9) Social responsibility (know what challenges
there are in the community)

Question 10

Hedging against inflation

#Influencing supervisory bodies
#Bargaining sessions between management &
unions

Provide ONE term for the abovementioned

Answer 10

Lobbying

Question 11

Finding new customers

#Taking part in social events
#Using social media

Provide ONE term for the abovementioned

Answer 11

Networking

Question 12

Strategic alliance agreements

#Persuasion from large investors
#Influence of company representatives

Provide ONE term for the abovementioned

Answer 12

Power relationships

Question 13

Provide ONE term for the following:

A form of acquisition in which one business buys another business entirely

Answer 13

Takeover

Question 14

Provide ONE term for the following:

When 2 businesses join together to form a new business

Answer 14

Merger

Question 15

Provide ONE term for the following:

When a business sends a representative to government or a regulating body to get a law passed or changed

Answer 15

Lobbying

TIP: To get any law change; law starts with “L” = the same as “L” for Lobbying :-)

Question 16

Provide ONE term for the following:

When individuals exchange info, often socially, to achieve some benefit and promote themselves

Answer 16

Networking

Question 17

Is the following TRUE or FALSE. If it is false, provide the correct statement

The South African Chamber of Business (SACOB) is a group that lobbies on behalf of businesses in South Africa

Answer 17

True :)

Question 18

Is the following TRUE or FALSE. If it is false, provide the correct statement

When unions and employers have bargaining sessions as part of wage negotiations, we can see this as part of networking.

Answer 18

False - it is part of lobbying

Question 19

Is the following TRUE or FALSE. If it is false, provide the correct statement

Appointing an influential person in the industry to the board of your business is called using a power relationship

Answer 19

True

Question 20

Is the following TRUE or FALSE. If it is false, provide the correct statement

Power relationships can be used by a business to get a special discount, or quality for a grant, or get special treatment where it counts.

Answer 20

True

Question 21

Is the following TRUE or FALSE. If it is false, provide the correct statement

By law, all businesses have to comply with BEE

Answer 21

False, only businesses with an annual turnover of more than R5 million have to comply