9609 · 6.2.1
Developing business strategy flashcards
Revision flashcards for Cambridge 9609 Developing business strategy (syllabus 6.2.1). Flip, recall, then mark a real past-paper question.
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Business strategy?
Long-term plan showing how firm achieves objectives and competes — direction of travel.
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Mission statement?
Purpose of organisation — why it exists.
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SWOT S and W?
Internal — strengths and weaknesses (resources, skills, brand).
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SWOT O and T?
External — opportunities and threats (from PESTLE, competition).
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Ansoff penetration?
Existing product, existing market — increase share.
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Ansoff product development?
New product, existing market.
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Ansoff market development?
Existing product, new market/geography.
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Ansoff diversification?
New product, new market — highest risk.
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What is the primary role of a mission statement in strategy development?
It sets the overall purpose and long-term direction of the organisation, acting as a guiding principle against which all strategic options and decisions are evaluated.
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Distinguish between the internal and external components of a SWOT analysis.
Strengths and Weaknesses are internal factors that the business has some degree of control over (e.g., brand reputation, staff skills). Opportunities and Threats are external factors from the wider environment that the business cannot control (e.g., new technology, competitor actions).
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According to Ansoff's Matrix, what is 'Product Development'?
A growth strategy where a business aims to introduce new products into its existing markets. This strategy often requires strong research and development capabilities.
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How does PESTLE analysis inform strategic choice?
PESTLE analysis identifies key external factors (Political, Economic, Social, Technological, Legal, Environmental) that can shape a strategy's potential for success. It provides the evidence to justify choosing one strategy (e.g., Market Development) over another by highlighting relevant opportunities and threats.
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Define 'Diversification' in the context of Ansoff's Matrix.
Diversification is a high-risk growth strategy where a business develops new products to sell in new markets. It requires the business to operate outside of its existing expertise in terms of both products and market knowledge.