Analysing the Strategic Position of a Business | AQA A-Level Business (7132)

Analysing the Strategic Position of a Business

352 questions
27 subtopics
Strategy, assessed on all three papers
Paper 1, Paper 2 and Paper 3

Analysing the strategic position of a business is examined on Papers 1, 2 and 3, and is the largest topic in the course.

It covers the hierarchy of objectives, the internal analysis of financial and non-financial performance, the external analysis of the political, economic, social and competitive environment, and the appraisal of an investment.

Sample questions from Analysing the Strategic Position of a Business

Answer each one closed book first, then open the answer.

Influences on the mission and corporate objectives

Why are stakeholder demands considered an external influence on a business mission?

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Different stakeholder groups such as customers, communities and pressure groups have expectations that can shape or constrain the purpose and values a business adopts.
SWOT analysis and its limitations

What does the 'T' in SWOT analysis represent?

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Threats – external factors or trends that could cause problems or harm to the business.
Financial statements and the categories of ratio

What do efficiency ratios measure?

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How effectively a business manages its working capital and assets
Benchmarking and core competences

Why are core competences important for strategic decision-making?

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Core competences form the basis of sustainable competitive advantage, so strategic decisions should build on and protect these distinctive capabilities.
Environmental legislation and government support

What do packaging requirements under environmental law typically mandate?

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Rules on reducing packaging waste, using recyclable materials, meeting recycling targets and providing clear disposal information to consumers.
GDP, taxation and exchange rates

What is the difference between direct and indirect taxes, and give an example of each?

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Direct taxes are levied on profits (corporation tax) and income. Indirect taxes are levied on spending (e.g. VAT). Both affect business costs and consumer purchasing power.
Demographic and social change

What three dimensions of purchasing decisions are affected when consumer buying behaviour changes?

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How consumers make purchases, when they make purchases, and where they make purchases
Porter's five forces: entry and buyer power

Why does strong brand loyalty act as a barrier to entry?

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Customers remain loyal to established brands, making it difficult and expensive for new entrants to attract customers away from existing firms.

The 27 subtopics

One subtopic is one session. Work down the list.

Subtopic	What it covers	Questions
Influences on the mission and corporate objectives	The internal capabilities and external pressures that shape what a business sets out to do.	19
Mission, objectives, strategy and tactics	How mission, corporate and functional objectives fit together, and how strategy differs from tactics.	9
Functional objectives and their influences	What each function sets out to achieve, and the internal and external influences on it.	8
SWOT analysis and its limitations	The four elements, matching strengths to opportunities, and why the analysis is subjective and static.	14
Return on capital employed and the current ratio	Calculating both, and what each says about profitability and liquidity.	12
Gearing and the ratios of working capital	Gearing, payables days, receivables days and inventory turnover, and what each reveals.	18
Financial statements and the categories of ratio	What the balance sheet and income statement show, and the profitability, liquidity, gearing and efficiency categories.	13
Using ratio analysis, and its limits	Comparing over time and between firms, and why window dressing and industry differences distort it.	14
Non-financial measures of performance	Capacity utilisation, productivity, quality, labour turnover, market share and customer retention.	14
Benchmarking and core competences	Comparing against the industry, identifying core competences, and short-term against long-term assessment.	10
The Triple Bottom Line	Profit, people and planet, Elkington's argument, and the difficulty of comparing the three.	8
Competition law and labour market legislation	Price-fixing and abuse of dominance, and the minimum wage, working hours and anti-discrimination law.	14
Environmental legislation and government support	Pollution control, waste, emissions and reporting duties, and the tax incentives and grants on offer.	10
Regulators, infrastructure and environmental incentives	What regulators do, how infrastructure creates opportunity and threat, and carbon taxes and emissions trading.	12
Trade policy and responding to political change	Tariffs, quotas, subsidies and trade agreements, and lobbying, relocation and diversification as responses.	18
GDP, taxation and exchange rates	How GDP, corporation tax, income tax, VAT and the exchange rate affect a business.	11
Inflation, fiscal policy and monetary policy	Inflation, expansionary and contractionary fiscal policy, and interest rates as monetary policy.	9
Trade, protectionism and responding to economic change	Free trade and protectionism, and the strategic and functional decisions economic change forces.	19
Demographic and social change	Ageing, migration, changing purchasing habits, and the pressure to act responsibly.	9
Corporate social responsibility and its critics	What CSR delivers, what it costs, and the shareholder and stakeholder concepts.	14
Carroll's pyramid and technological change	The four levels of the pyramid, and how technology changes each function of a business.	16
Porter's five forces: entry and buyer power	What raises the threat of entry, and what gives buyers power over a business.	13
Supplier power, rivalry and substitutes	What gives suppliers power, what intensifies rivalry, and when substitutes threaten.	17
Using five forces to shape strategy	Reading the collective strength of the forces, and building barriers or reducing supplier power.	12
Payback period and average rate of return	Calculating both, what each shows, and the weakness they share.	17
Net present value and the time value of money	Discounting future cash flows, calculating present value, and reading a positive NPV.	11
Investment criteria, risk and sensitivity analysis	Hurdle rates, the non-financial factors that override them, and testing an investment for sensitivity.	11

Analysing the Strategic Position of a Business is 352 of the 1,819 questions in the guide.Get the guide, £8

How the guide is worked

Answering a question from memory stores it far better than reading the answer again. The guide runs that as a fixed procedure on one subtopic at a time, about twenty minutes a session.

Step 1 · Closed book
Cover the answers. Work through one subtopic and write down what you can. Leave blanks where you have nothing.
Step 2 · Open book
Go back to the top. Read each printed answer and write it out in full, including the ones you had right.
Step 3 · Closed book again
Same questions, same order, from memory. The gap between pass one and pass three is the session result.

Read the full method, the return schedule and the research behind it.