Unit 1.3-1.6

Question 1

Vision statement

Answer 1

A vision statement outlines the the businesses purpose and values as well as where the business aspires to be in the future.

Question 2

Mission statement

Answer 2

A mission statement concisely outlines the purpose of a business and the steps a business implements in order to achieve its objectives and overall vision.

Question 3

Aims

Answer 3

Aims are the long term goals of an organisation formulated by senior management of an organisation. Are often articulated in the businesses mission statement.

Question 4

Objectives

Answer 4

Objectives are the targets a business strives to meet. Are usually constrained within the Specific, Measurable, Achievable, Realistic and Time constrained (SMART) template. Give direction to stakeholders. Can be articulated in the mission of a business.

Question 5

Strategies

Answer 5

Are long term plans that articulate how a business intends on meeting its objectives and aims.

Question 6

Tactics

Answer 6

Are short term, smaller scale decisions that advance businesses towards achieving their aims and objectives.

Question 7

A change in objectives can be prompted by:

Answer 7

Internal factors: Expansion of the business
Crisis management
Change in senior management

Question 8

A change in objectives can be prompted by:

Answer 8

External factors: Business cycle
Laws and regulations
Technological changes
Social trends

Question 9

Corporate social responsibility

Answer 9

the obligations of an organisation to its stakeholders to behave in a manner that does not harm and positively benefits society.

Question 10

Market penetration

Answer 10

When a business focuses on and existing product in an existing market.

Question 11

Market development

Answer 11

When a business introduces an existing product to a new market. Usually determined by a change in the customer base.

Question 12

Product development

Answer 12

When a business introduces a new product to an existing market.

Question 13

Stakeholders

Answer 13

Are individuals, organisations or groups who have a direct interest in a businesses operation.

Question 13

Economies of scale

Answer 13

The cost saving benefits of operating a business at a large scale.

Question 14

Diseconomies of scale

Answer 14

The increases of unit costs due to the growth of a business.

Question 15

Internal economies of scale

Answer 15

The fall of unit costs of production for a single organisation as it experiences growth.

Question 16

External economies of scale

Answer 16

The fall of unit costs of production for all organisations as the industry experiences growth.

Question 17

Internal growth

Answer 17

When an organisation expands internally using financial resources acquired from retained profits.

Question 18

External growth

Answer 18

When an organisation expands on the reliance of 3rd party organisations.

Question 19

Types of external growth

Answer 19

Mergers
Takeovers
Aquisitions

Question 20

Joint ventures

Answer 20

A legal agreement between two separate entities to combine their resources to form one business.

Question 21

Strategic alliances

Answer 21

Alliances between two or more businesses in order to rely on each others resources for individual strategic advancement.