Ansoff's Matrix and BCG

Identify the factor that is not part of a STEEPLE analysis.

• Economic
• Ethical
• Legal
• Productivity

Answer explanation

A STEEPLE analysis is a tool used to analyze the external environment that a business operates in. It considers the social, technological, economic, ethical, political, legal, and ecological factors affecting the organization. Whilst productivity does affect business operations, it is not an external factor in its own right.

Identify the most appropriate description for the purpose of a STEEPLE analysis.

• To assess a firm's current situation environment
• To assess a firm's external environment
• To assess a firm's historical market performance
• To assess a firm's market position

Answer explanation

A STEEPLE analysis is a management tool used to analyze the external business environment that a business operates in. By considering these factors affecting a firm, it can provide insight into potential opportunities and threats.

Opportunities are factors that can potentially benefit a business, whereas threats are factors that can potentially harm a business.

• External, external
• External, internal
• Internal, external
• Internal, internal

Answer explanation

Opportunities and threats are both external factors that can benefit or harm a business. The internal factors that are favorable compared to competitors are called strengths, while internal factors that are detrimental compared to competitors are called weaknesses. A STEEPLE analysis focuses on external opportunities and threats.

A global financial crisis would be a(n) threat for luxury car manufacturers.

• Economic
• Environmental
• Political
• Social

Answer explanation

Factors related to the financial wellbeing of a country are considered to be economic factors. A global financial crisis causes unemployment, and therefore lower disposable incomes. As incomes fall, the demand for luxury cars reduces because fewer people can afford them. Thus, this is a threat to car manufacturers.

Which of the following is not a social influence that affects an organization?

• E-commerce
• Fashions and tastes
• Level of education
• Population size

Answer explanation

Social factors are those concerning the attitudes, values, and attributes of a society. These are influenced by variables such as population size, level of education, fashions and tastes, and demographic factors. Option A is not a social factor because e-commerce is a technological factor.

Technology creates opportunities and threats for an organization. Identify the false example of technological influence on an organization.

• Big data
• Carbon footprint
• Cloud computing
• Level of automation

Answer explanation

Technological factors refer to advances in technology, which create both opportunities and threats for businesses. Technological factors include the level of adoption and utilization of big data, cloud computing, and the level of automation as new technologies can increase productivity and efficiency. However, carbon footprints are related to ecological influences, not technological ones.

The economy enhances, but also limits an organization's growth. Identify the false example of economic influence of an organization.

• Inflation rates
• Interest rates
• Legislation
• Recession

Answer explanation

Economic factors are those related to the state and health of the economy as a whole. Recessions can create opportunities for businesses that sell essential, economy products, whereas threats exist for organizations that offer luxury goods and services during a recession. Inflation and interest rates can impact the level of spending by consumers and the ability to access finance for both consumers and businesses. Legislation is part of the legal factor of STEEPLE.

Identify the tool most closely aligned with the STEEPLE analysis.

• Ansoff matrix
• BCG matrix
• Decision trees
• SWOT analysis

Answer explanation

STEEPLE analysis usually fits into the external opportunities and threats sections of a SWOT analysis, as the strengths and weaknesses of a SWOT are limited to the internal characteristics of an organization.

There are many political influences on an organization. Identify the false example of a political influence.

• Stability of government
• Trade policies
• The choice of fiscal and monetary policies
• The state of the economy

Answer explanation

Political stability (stability of the government) is a major political factor. Political factors include the choice of trade policies, e.g., the extent of protectionist measures such as quotas or tariffs on imports, or subsidies to domestic suppliers. The choice of fiscal and/or monetary policies that is used also impacts the level of economic activity, but these policies are enacted by the government. However, the state of the economy is an economic factor that influences an organization.

There are several legal influences on an organization. Identify the wrong example of a legal influence.

• Appointment of high court judges
• Consumer protection legislation
• Competition laws
• Employment ordinances

Answer explanation

Appointment of high court judges is an example of a political factor as this will influence the ideology of a country. Legal factors include consumer protection legislation, competition laws to prevent monopolies dominating industries and abusing their market power, and employment ordinances to protect employees from exploitation and unfair practices at work.