QuestionQuestionConceptConceptDocumentDocument

Unit 3: Business Decisions and Strategy

Start with Concept to understand a topic, then use Question Bank to check what you know.

6 topics · 62 learning objectives

Your progress

Sign in to see your mastery and mistakes.

  1. 3.3.1 - Business objectives and strategy

    1. Explain development of corporate objectives from mission statements and corporate aims.

    2. Critically appraise mission statements.

    3. Use Ansoff Matrix and Porter Strategic Matrix in corporate strategy.

    4. Explain the aim of portfolio analysis.

    5. Analyse effects of strategic and tactical decisions on human, physical and financial resources.

    6. Use SWOT analysis with internal strengths and weaknesses and external opportunities and threats.

    7. Apply PESTLE analysis to external influences.

    8. Analyse the changing competitive environment.

    9. Apply Porter five forces.

  2. 3.3.2 - Business growth

    1. Analyse growth objectives including economies of scale, market power, market share, brand recognition and profitability.

    2. Distinguish inorganic growth from organic growth.

    3. Explain methods of growing organically.

    4. Evaluate advantages and disadvantages of organic growth.

    5. Analyse reasons for mergers and takeovers, differences between them, integration types, conglomerates and financial risks or rewards.

    6. Evaluate advantages and disadvantages of inorganic growth.

    7. Explain diseconomies of scale as a growth problem.

    8. Analyse internal communication problems from growth.

    9. Explain overtrading as a growth problem.

  3. 3.3.3 - Decision-making techniques

    1. Calculate time-series analysis using three-period or four-quarter moving averages.

    2. Interpret scatter graphs and line of best fit, including extrapolation of past data.

    3. Evaluate limitations of quantitative sales forecasting techniques.

    4. Calculate and interpret simple payback.

    5. Calculate and interpret average accounting rate of return.

    6. Calculate and interpret discounted cash flow using net present value only.

    7. Interpret figures generated by investment appraisal techniques.

    8. Evaluate limitations of investment appraisal techniques.

    9. Construct and interpret simple decision-tree diagrams.

    10. Calculate and interpret figures generated by decision trees.

    11. Evaluate limitations of using decision trees.

    12. Explain the nature and purpose of critical path analysis.

    13. Complete and interpret simple networks to identify the critical path.

    14. Calculate earliest start time, latest finish time and total float.

    15. Evaluate limitations of critical path analysis.

    16. Explain the nature and purpose of contribution.

    17. Calculate and interpret contribution.

    18. Use contribution as a decision-making technique.

  4. 3.3.4 - Influences on business decisions

    1. 3.3.4.1aStrong and weak cultures

      Compare strong and weak corporate cultures.

    2. 3.3.4.1bCulture classification

      Classify company cultures as power, role, task or person cultures.

    3. 3.3.4.1cCulture formation

      Explain how corporate culture is formed.

    4. 3.3.4.1dChanging culture

      Evaluate difficulties in changing an established culture.

    5. 3.3.4.2aInternal and external stakeholders

      Distinguish internal from external stakeholders.

    6. 3.3.4.2bStakeholder objectives

      Analyse stakeholder objectives.

    7. 3.3.4.2cStakeholder and shareholder influences

      Compare stakeholder-focused decisions with shareholder-return-focused decisions.

    8. 3.3.4.2dStakeholder conflict

      Analyse conflict between profit-based shareholder objectives and wider stakeholder objectives.

    9. 3.3.4.3aEthics and strategy

      Evaluate trade-offs between profit and ethics in strategic decisions.

    10. 3.3.4.3bPay and rewards ethics

      Analyse ethical issues in pay and rewards.

    11. 3.3.4.3cCorporate social responsibility

      Evaluate corporate social responsibility.

  5. 3.3.5 - Assessing competitiveness

    1. Interpret key information and stakeholder interest in statements of comprehensive income.

    2. Interpret key information and stakeholder interest in statements of financial position.

    3. Calculate and interpret gross profit margin, operating profit margin, profit-for-the-year margin, current ratio, acid-test ratio, gearing and return on capital employed using the prescribed financial statements and formulae.

    4. Interpret ratios to make business decisions.

    5. Evaluate limitations of ratio analysis.

    6. Calculate and interpret labour productivity, labour turnover, retention and absenteeism.

    7. Evaluate limitations of human resource calculations.

    8. Evaluate financial rewards, employee share ownership, consultation and empowerment as strategies to improve productivity and retention and reduce turnover and absenteeism.

  6. 3.3.6 - Managing change

    1. Analyse organisational culture as a key factor in change.

    2. Analyse organisation size as a key factor in change.

    3. Analyse time and speed of change.

    4. Evaluate managing resistance to change.

    5. Explain transformative leadership in managing change.

    6. Identify key risks through risk assessment, including natural disasters, IT systems failure and loss of key staff.

    7. Plan risk mitigation through business continuity and succession planning.