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25. Discuss 5 major types of performance measures that influence long-term profits. 26. Discuss 4 major...

25. Discuss 5 major types of performance measures that influence long-term profits.

26. Discuss 4 major determinants of strategic options.

27. Explain the BCG Growth-Share Matrix and discuss how it is used.

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Ans25 5 major types of performance measures that influence long term profits are as follows-

1. Human resource- employees performance affect the long term profits, if employees are satisfied, efficient and loyal then they works for the development of the company. Company’s performance can be measured by its employees’ performance.

2. Innovation and adaptation to change- how easily company can adapt changes and innovate according to the demand of time and market and it helps in gaining competitive advantage to the company and it is beneficial in long term as well.

3. Customer satisfaction- “customers are the king of market”, so their satisfaction is the major performance indicator for the company. More satisfied customers more profit in long run because they promote the product or service of the company.

4. Productivity- the input and output relationship of the company.

5. Profit- how they invest or use their revenues and expenditure on what, decides that the company will perform in future or not.

Ans26 4 major determinants of strategic options are as follows-

1. Financial capabilities- whether or not invest in a business. Increase the net investment or withdraw the cash.

2. Past and current strategies- it is important to make an accurate analysis of past profit and current strategies.

3. Attitude towards risk (organizational capabilities)- how company respond to the problems and their solutions.

4. Strengths and weaknesses- based on assets and their competencies.

Ans27 BCG growth share matrix is a tool used internally by the management of the company to analyze the current condition of value of firm’s units. It helps company in deciding which products to either keeps sell or invest more in it. It is used to ensure that the business invests resources wisely or not on products.

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