IB Business Management SL 6.1.2 Ansoff Matrix Questions
Practise 6.1.2 Ansoff matrix in IB Business Management SL by connecting concepts to case evidence and decisions.
- Syllabus
- First assessment 2024
- Course
- Business management SL
- Level
- SL
Exam points
- Tool for analysing growth strategies through markets and products
- Suggested integration: Units 1 and 4
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IB Business Management SL 6.1.2 Ansoff Matrix Questions question 1
[Maximum number: 4]
Martin and Susan were internal stakeholders with a conflict over Martin’s appointment, Susan’s resentment, her task-oriented and increasingly autocratic management, and Martin’s laissez-faire style, empowerment and delegation. The Imperial’s fixed costs could include the salaries of hotel staff, fixed electricity or internet charges, local property taxes and contracted promotional costs; under Option 2, fixed costs and variable cleaning and maintenance costs would be lower because apartments would be serviced weekly rather than rooms daily. Martin considered three Ansoff choices: Option 1 would renovate and relaunch the existing hotel for similar customers, Option 2 would transform rooms into apartments for business travellers, and Option 3 would form a strategic alliance with KenSafar to reach package-tour customers. Empowerment could give employees authority, responsibility and autonomy, increasing job satisfaction and motivation and encouraging better productivity. Susan was efficient, hard-working and committed but bureaucratic, formal, cold and autocratic; Martin was warm, friendly and laissez-faire, allowing supervisors to resolve problems. Martin’s leadership could support empowerment, while Susan’s task focus could protect housekeeping standards but damage morale.
Explain the value of the Ansoff matrix as a decision-making tool for Martin Kimathi to choose between Options 1, 2 and 3.
Existing products
New products
Existing market
Market penetration
Product development
New market
Market development
Diversification
Option 1 is "existing market" "The new hotel would attract the same customer types" (see line 135) but with a slightly different product (renovated hotel) however this is still a hotel, so "product development" is not an ideal description. Option 2 is "quite a different product" (though still a hotel) with "quite a different type of customers" (still visitors to Mombasa though), so again "diversification" would not be appropriate.
Option 3 is "slightly different market" (though still tourists to Kenya) with a "slightly different product" (some improvements to the hotel) - but talking about "diversification" may be too exaggerated.
The three options at the end of the case study illustrate very well the limits of the Ansoff matrix.
N.B: Candidates are not asked to draw the Ansoff matrix itself (ie the table);
candidates are very likely to do so, but a candidate could receive full marks even without it. Put another way, a candidate will not be penalized if their answer is only textual.
The [4 marks] available are allocated as follows:
Award [1 mark] for an answer that shows partial knowledge and understanding of what the Ansoff matrix is;
this could be in the form of a diagram.
Award [1 mark] for an answer that shows clear knowledge and understanding of the strategies within the Ansoff matrix (market development, product development etc);
this could be in the form of a diagram.
Award [1 mark] for the application to The Imperial (bearing in mind that interpretations may vary, for example Option 3 could be presented as market development).
Award [1 mark] for an explanation of the value of the matrix for Martin (although the case study shows that the matrix is of very limited value, a candidate could argue that it is a valuable tool in some ways).
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