Strategic direction is the set of activities and decisions a firm needs to make to achieve its goals and objectives. Having a strategic direction ensures that all business decisions that are being made by the organization are concentrated on specific objectives.

The overall strategic direction is usually set by executives and managers of the organization, as they have the most oversight on the overall performance of the firm.

Defining a strategic direction ensures that owners, managers and employees are focused on the objectives of the firm. It also ensures that all business decisions that are being made by the organization are concentrated on these objectives.

The overall purpose is often entailed in the mission and vision of the firm and can range anywhere from operating a profitable business with low costs to making the world a better place.

The outsourcing decision matrix.

Strategic importance and contribution to operational performance

When tasks are strategically important but contribute little to operational performance.

When tasks are strategically important and contribute significantly to the operational performance of the organization.

When tasks are not strategically important but contribute significantly to the operational performance of the organization.

When tasks are not strategically important and do not contribute to the operational performance of the business.

Setting marketing strategy

By decreasing prices and / or increasing promotion.

By expanding their product offering or by developing unrelated products.

When the company is trying to sell its existing products in new markets or to new customer segments.

SWOT and PESTLE.

Competition can be defined as the aggregation of businesses in the same market competing for the attention of consumers. Competition is present in all profitable markets, where businesses compete on price, quality, reputation, brand name, etc.

Competition trends to boost innovation.

Competition is beneficial for consumers as it can lead to economic growth and lower prices (as a result of innovation).

All of the above answers are correct.

Both statements are correct. 

Direct, indirect and replacement competition.

Direct competitors are businesses that sell similar (or the same) products to the same customer segments in the same market.

Indirect competitors are businesses that sell products that are not the same as yours but they still operate in the same industry and satisfy the same consumer need.

Replacement competitors are businesses that sell products different to yours but could potentially replace your business's offering due to new technologies. The products sold by these types of competitors are often providing new solutions to a problem as a result of innovation that customers could decide to spend their money on instead.

Direct competition

Both statements are correct. 

All of the above answers are correct. 

• Increased innovation. 

• Helps businesses gain more insight into the wants and needs of consumers

A growth strategy.

All of the above.

Vertical diversification, also known as vertical integration, is when you expand forward or backwards in your supply chain or production process. During vertical integration, the business combines two or more stages of production that are usually operated by other companies.

Horizontal diversification is when your business expands into products or fields that are somewhat unrelated to current business activities.

Concentric diversification is when your business starts producing products that are similar in the type of technology or expertise it requires to produce them.

 Conglomerate diversification is when your business develops products that are completely unrelated to its current product offering.

For example, if you are a company selling fragrances you might expand into selling other products like hair care or body wash. The new products are not directly related, but if customers enjoy your fragrances they could be interested in buying other cosmetic products that use the same fragrances.

A company that sells laundry detergent starts selling jeans (unrelated products).

By using the Ansoff matrix, businesses can examine various growth strategies and use their analysis for strategic planning.

Market penetration, market development, product development and diversification.

The business trying to sell its existing products in new markets.

The business trying to sell new products in new markets.

Both statements are correct. 

• Diversification often leads to increased profitability. 

• Businesses can tap into industries, markets and segments that have not been reached yet. 

• There could be a lack of expertise in one field if the business is operating in multiple industries, which can reduce the business's competitiveness. 
• Diversification can also be confusing to customers if the business is known for a signature product.

It is a strategic tool which designs a marketing strategy to analyze a company’s competitive position.

It helps to determine how a product should be positioned to give it the most competitive position in the market.

You should think about the two dimensions: value and price of a product or service. They will help you to arrive at an appropriate position on the clock.

Low price and value added, low price, hybrid, differentiation, focused differentiation, risky high margins, monopoly pricing, loss of market share.

Ikea, Wilko.

Adidas