What term describes the practice of focusing on specific activities where a business has strengths?

• A. Diversification
• B. Outsourcing
• C. Specialisation
• D. Decentralisation

Answer: (C)

Specialisation is the practice of concentrating a business’s efforts on activities where it has strengths. By focusing on what it does best, a business can develop greater expertise, operate more efficiently, and deliver higher quality or faster service in that area, which helps it stand out from competitors.

Diversification would mean branching into new products or markets, which shifts resources away from current strengths. Outsourcing involves contracting work to another firm rather than focusing internal capabilities. Decentralisation is about spreading decision-making, not about concentrating on a core strength.