Unit 9 - Strategic Methods To Pursue Strategies

Question 1

Strategic methods

Answer 1

Refer to the different strategies a business might pursue to achieve its objectives

Question 2

Economies of scale

Answer 2

Occur when unit costs fall as a business expands; these economies relate to the volume of output

Question 3

Economies of scale

Answer 3

Occur when a business gains cost advantages by sharing costs between different products and divisions; these economies relate to the scope of the activities of the business

Question 4

The experience effect

Answer 4

Is the cost advantages that occur having been in an industry for some time and, therefore being able to make better decisions

Question 5

Diseconomies of scale

Answer 5

Occur when unit costs increase as a business expands

Question 6

Over trading

Answer 6

Occurs where there are liquidity problems linked to the financing of rapid growth

Question 7

Franchise

Answer 7

Occurs when one business sells the right to another business to use its name and sell its goods or services in return for a fee

Question 8

Franchisor

Answer 8

Sells the franchise to a franchisee

Question 9

Vertical integration

Answer 9

Occurs when one business joins together with another business at a different stage of the same production process

Question 10

Horizontal integration

Answer 10

Occurs when one business joins together with another business at the same stage of the same production process

Question 11

Conglomerate integration

Answer 11

Occurs when one business joins together with another business in a different production process

Question 12

Retrenchment

Answer 12

Occurs when a business reduces the scale of its operations

Question 13

Kaizen

Answer 13

Refers to a process of continuous improvement. This is a management approach in which employees regularly look for small improvements in the way they do their work

Question 14

Intrapreneirship

Answer 14

Occurs when individuals within organisations are being entrepreneurial - taking risk and generating new ideas

Question 15

Benchmarking

Answer 15

Occurs when a business tries to match the approach and success of a particular process that is used by another organisation

Question 16

Multinational company MNC

Answer 16

Has operations based in overseas markets

Question 17

Free trade

Answer 17

Occurs when there is trade between countries without barriers such as tariffs and quotas

Question 18

Internationalisation

Answer 18

Describes the process of designing products to meet the need of users in multiple countries, thus designing them so they can be easily modified to be suitable in the local market

Question 19

Tariff

Answer 19

Is a tax placed on foreign goods and services

Question 20

Quota

Answer 20

Is a limit on the number of imported goods and services

Question 21

Customs union

Answer 21

Occurs when there is a free trade between member countries but an agreed tariff on non-members

Question 22

Economic growth

Answer 22

Is the rate of increase in the size of an economy over time

Question 23

Emerging markets

Answer 23

Describes a country with low incomes per head but one which is enjoying high rates of economic growth

Question 24

Off-shoring

Answer 24

Occurs when a business moves its production overseas

Question 25

Re shoring

Answer 25

Occurs when a business moves production back to the domestic country

Question 26

E-commerce

Answer 26

Is the buying and selling of products through an electronic medium such as the internet

Question 27

Data mining

Answer 27

Is an analytical process that aims to analyse data in order to identify patterns and relationships between variables

Question 28

Buff data

Answer 28

Refers to the huge amount of data that can now be mined from multiple sources to find links