NCEA Level 3 Business Studies AS 91380: External factors and strategic responses in a global context (2024)

Flashcards cover PESTLE factors, strategic responses, analytical tools, exemplars, evidence, and exam-ready templates for AS 91380.

What does PESTLE stand for in a global business context?

Political, Economic, Socio-Cultural, Technological, Legal, and Environmental factors that shape external pressures on a business.

Give an exam-style example of a PESTLE factor and its mechanism.

Example: rising USD/NZD exchange rate volatility; mechanism: strengthens NZD → export revenue falls in NZD terms → margin pressure.

External factor (definition).

Outside the firm’s control that influences performance and strategic decisions.

Strategic responses menu (long-term, organisation-wide).

Long-term moves such as market development, product differentiation, cost leadership, vertical integration, strategic alliances/M&A, supply-chain resilience, currency/price strategy, standardisation vs localisation, digital transformation, sustainability/ESG, and R&D/innovation.

Linking factor to strategy template.

Because of [factor], the business chose [strategy] to achieve [objective] by [how implemented].

TOWS analysis purpose.

To justify why a chosen strategy fits by mapping threats/opportunities to strengths/weaknesses and showing a cause–effect alignment.

VRIO framework purpose.

To judge if a strategy creates sustained competitive advantage by assessing whether a capability is Valuable, Rare, Inimitable, and Organized to exploit it.

Ansoff Matrix growth strategies.

Penetration, Market Development, Product Development, and Diversification used to explain growth logic.

Triple Bottom Line.

A framework to evaluate wider impact: Profit, People, Planet.

Exemplar 1 external factors.

Fonterra example: external factors include tightening environmental rules in export markets and a socio-cultural shift to low-emissions, animal-welfare-conscious consumption.

Exemplar 1 strategic responses.

Sustainability-led differentiation with supply-chain traceability; on-farm data capture; traceability platforms; independent certification; premium branding; alignment with strengths in farmer network and scale.

Exemplar 2 external factors.

Global sportswear supply chain: political/economic shocks disrupting Asian manufacturing clusters; legal/social pressure for ethical labour standards and transparency.

Exemplar 2 strategic responses.

Supply-chain resilience plus ethical compliance: dual-sourcing, nearshoring, supplier scorecards/audits/public reporting/traceable materials.

Evidence to bring into the exam.

Specifics like dates/markets/segments; named partners; product lines; facility locations; mechanics like hedging and how a JV shares risk; how localisation changes conversion; outcomes like revenue/margin direction, market share, lead times, defect rates; balance of costs/risks/trade-offs.

Merit scaffold.

Analyse with depth: factor → causal chain; strategy → implementation steps; fit with resources/markets; show alignment and justification.

Excellence scaffold.

Judgement across short/medium/long term; consider stakeholders; discuss risks and trade-offs; propose alternatives; justify chosen option and residual risks.

Currency management strategies.

Hedging (forward/futures), price localisation, and value-based pricing; balancing revenue stability and margins; potential natural hedges via sourcing in the same currency.

Localisation vs Standardisation.

Standardisation keeps a uniform global offer; localisation adapts to cultural/legal contexts for market fit; each has costs and opportunities.

Two plug‑and‑play outlines (Outline A/B) concept.

Pre-structured templates to apply to a factor and strategy, with fit tool (VRIO/TOWS) and evaluation horizons.

Exam planning tips (brief).

Decode factor, outline causal chain, apply merit to excellence scaffold, evaluate with alternatives, and link to global context and stakeholders.