Theme 3

Question 1

Mission statement

Answer 1

The overall reason for a businesses existence

Question 2

Corporate aims

Answer 2

The long term targets and plans to fulfill the mission statement

Question 3

Corporate objectives

Answer 3

The medium to long term quantifiable targets to fulfill the mission statements

Question 4

Corporate strategy

Answer 4

The actions to be taken by the business to achieve its objectives

Question 5

Ansoffs matrix

Answer 5

Existing. New

Existing MP. PD

New MD. D

Question 6

Porter’s strategic matrix

Answer 6

Lowest cost. Highest diffe.

Mass market. CL. D

Niche market. FCL. FD

Question 7

Kay’s way to achieving competitive advantage

Answer 7

Architecture - relationship with stakeholders

Reputation - based on customer experience

Innovation - new products and processes

Question 8

Porter’s 5 forces

Answer 8

1. Industry rivalry
2. Threat of new entry
3. Buyer power
4. Threat of substitution
5. Supplier power

Question 9

Horizontal intergration

Answer 9

When a company joins with similar businesses in the same field to help them grow or lessen competition

Question 10

Vertical intergration

Answer 10

When a company controls different stages of making a product to make things more efficient and cheaper

Question 11

Reasons for staying small

Answer 11

• more personalised service
• response quickly
• rapid growth can cause diseconomies if scale
• owners goal is not profit maximisation

Question 12

Short termism

Answer 12

The business is only interested in a quick financial reward

Question 13

Long termism

Answer 13

Considers ethical behaviour of the business in decision making + incorporates CSR

Question 14

Evidence-based decision making

Answer 14

Decisions are based on evidence and data - valued and trusted

Question 15

Subjective decision making

Answer 15

Decisions based in feelings, opinions and personal perspectives

Question 16

Handy’s Power culture

Answer 16

Spider on web = manager at the heat of the business

Central figure making decisions

Question 17

Handy’s role culture

Answer 17

Bank = red tape in the rigid organisation

Decisions made through well-established rules and decisions

Question 18

Handy’s task culture

Answer 18

Matrix = series of work teams in a large organisation

Involves team work on a project

Question 19

Handy’s person culture

Answer 19

Petri dish = symbolises employees in an organisation that are autonomous and skilled

Work on a client by client basis rather than project basis like task culture

Question 20

Changes must be

Answer 20

R realistic
A achievable
M measurable

Question 21

Planned change

Answer 21

Change which is planned by the top management of the business

Question 22

Emergent change

Answer 22

Change that happens at any level in the organisation and is the result of an event or need

Question 23

Dr Kotter’s 8 steps

Answer 23

1. Create a sense of urgency
2. Build a guiding coalition
3. Form a strategic vision and initiatives
4. Enlist a volunteer army
5. Enable action by removing barriers
6. Generate short-term wins
7. Sustain acceleration
8. Institutes change

Question 24

kay’s distinctive capabilities can be tested using 3 questions

Answer 24

1. Do they allow for market development?
2. Do they provide noticeable benefits to the end user?
3. Are they difficult to imitate?

Question 25

SWOT - Strengths and Weaknesses

Answer 25

- Financial performance - Resource management - Human resource management - Marketing - Culture of the business - Corporate social responsibilities and ethics

Question 26

SWOT - Opportunities and Threats (PESTLE)

Answer 26

- Economic environment - Political and legal environment - Degree of competition - Technological change - Legislation - Consumer trends - Demographics

Question 27

Time-series analysis

Answer 27

- part of quantitative sales forecasting - this uses historical data, smoothed out, to make better predictions for the future.

Question 28

5 steps of evidence-based decision making

Answer 28

Step 1: Ask - translate a problem into a question. Step 2: Acquire the evidence. Step 3: Appraise the evidence. Step 4: Apply the evidence to the problem. Step 5: Assess the outcome of the decision.

Question 29

Corporate Social Responsibility (CSR)

Answer 29

A business approach that contributes to sustainable development by delivering economic, social, and environmental benefits for all stakeholders.

Question 30

Scenario planning

Answer 30

- The process of looking at potential future situations and planning for those events. - The idea is that if we look creatively at what the future could look like (e.g., energy needs), the drivers and implications that a business can create a series of strategies to handle those situations.

Question 31

Risk acceptance

Answer 31

- The balance between risk and reward is the very essence of the business: without taking risks companies cannot generate profits. - Difference between calculated risks, taken with planning and careful judgement, and risks taken carelessly and unwittingly.

Question 32

Risk avoidance

Answer 32

The elimination of hazards, activities and exposures that can negatively affect an organisation's assets.

Question 33

Risk management

Answer 33

Aims to control the damages and financial consequences of threatening events.

Question 34

Risk limitation

Answer 34

Some risks are both identifiable and manageable, they can be limited by: - becoming an Ltd. to gain limited liability. - Having plenty of insurance. - Managing data carefully.

Question 35

Risk transference

Answer 35

A business will buy insurance, for example: PUBLIC LIABILITY INSURANCE - Covers the business for claims made against the business by a client or member of the public for accidental injury. EMPLOYER'S LIABILITY - Protects the business if an employee is injured and the business has been negligent.