AP Business Unit 4 Cheatsheet: Management and Strategy

Management = planning, organizing, leading, and evaluating use of human, financial, and physical resources to meet business goals. Operates at all levels: executives to supervisors.

Leadership Skills:

• Articulate vision and mission
• Build productive teams
• Negotiate conflicts
• Motivate people (drives productivity, retention, customer relationships)

Communication Skills:

• Express ideas clearly and persuasively
• Listen empathetically
• Interpret and respond to feedback

Purpose: Evaluate competitive intensity, attractiveness, and profitability of a market.

The Five Forces:

1. Competitive Rivalry: intensity of competition among existing firms (e.g., number of competitors, differentiation, and pricing pressure) — strength varies by industry
2. Threat of New Entrants: ease of entry determined by barriers to entry
3. Threat of Substitutes: availability of alternative products meeting same customer needs
4. Customer Power: buyers' ability to drive prices down (shaped by customer count, acquisition costs, switching costs)
5. Supplier Power: ability to raise input costs (shaped by number of suppliers and switching costs)

SWOT = framework evaluating internal and external factors affecting a business's ability to accomplish goals and remain competitive.