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BUSS3 ­ Key Words

Functional Objectives & Strategies

Aims / goals General statements of what a business intends to achieve.
Precise details of those intentions are set out in objectives

Business unit How a business attempts to compete successfully in a particular
strategy market
Corporate Objectives that relate to the…

Page 2

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BUSS3 ­ Key Words

Financial Strategies and Accounts

Acid-test ratio A liquidity ratio that looks at whether a business can pay for current
liabilities out of cash and near-cash assets (it ignores the value of stocks)
Asset turnover A ratio that calculates the relationship between revenues and the total

Page 3

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BUSS3 ­ Key Words

Payback period The time it takes for a project to repay its initial investment
Profit centres A separately-identifiable part of a business for which it is possible to
identify revenues and costs and calculate a relevant profit

Profit quality The sustainability of profit from one period…

Page 4

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BUSS3 ­ Key Words

Marketing Strategies

Ansoff's Matrix A strategic model for helping a business analyse the relationship
between general strategic direction and suitable marketing
Average A term for various measures of central tendency, including the
mean, mode and median
Competitive Skills, competences, resources and other advantages that enable…

Page 5

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BUSS3 ­ Key Words

Operational Strategies

Capital intensity The extent to which production or operations depend on investment in and
use of capital ­ i.e. machinery, IT systems, buildings etc
Efficiency A measure of the ability of a business to achieve the required level of
production whilst minimising the use…

Page 6

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BUSS3 ­ Key Words

Human Resource Strategies

Arbitration An alternative to a court of law in determining legal and employment
disputes. Involves a specialist outsider being asked to make a decision on a
Centralisation An organisational structure where authority rests with senior management
at the centre of the business…


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