ITPEC IP October 2023 Question 81
In order to consider near-term strategies, automobile manufacturer Company A identified its strengths and weaknesses, as well as the opportunities and threats it faces in the external environment. On the basis of the results, which of the following is appropriate as measures to leverage the company's strengths and overcome the threats?
Explanation
Conduct research and development and commercialize electric automobiles — the measure uses the R&D strength to overcome the threats of rising oil prices and environmental awareness.
A cross-SWOT analysis pairs an internal factor with an external one: SO uses strengths to seize opportunities, ST uses strengths to overcome threats, WO fixes weaknesses to seize opportunities, and WT limits weaknesses while avoiding threats. The question asks for ST. Company A's strengths are its strong brand image and accumulated multi-directional R&D; its threats are the sharp rise in oil prices and the spread of environmental conservation consciousness. Electric cars need no petrol and emit no exhaust, so developing them with the company's R&D answers both threats.
Answer (c)
Why not others:
- •(a) — extending the retirement age or rehiring skilled workers deals with the weakness, the large-scale retirement of skilled workers, not with a strength
- •(b) — borrowing at low interest exploits the opportunity (monetary easing), and stockpiling oil is a short-term defence that uses none of the strengths
- •(d) — using the brand image to strengthen sales builds on a strength, but it does nothing about oil prices or environmental concern
Key rule: In cross-SWOT, first name the pair the question asks for (here strength × threat), then pick the measure that uses that strength and answers that threat.
Business Strategy Management · AI-written, may contain errors
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