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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. Z is a medium-sized UK based accounting practice. Z operates a graduate training scheme. The trainees are given an induction and then placed on a three-year training programme designed to help develop professional skills and experience.
The training programme has been in existence for many years. However, there is no clear consensus amongst the partners of Z about what the trainees should be able to do on completion of the programme and therefore what the training programme should emphasize. This lack of clarity is affecting the morale and commitment of the trainees and significant numbers are failing the programme or leaving to join a rival firm.
Z's HR Department recognizes the need for committed and well motivated accountants to meet the increased expectations of clients and the competition from rival firms. The HR Department has identified changes to the training programme that can be implemented gradually through a series of initiatives.
Which TWO of the following statements regarding the change required in Z are correct? (Choose two.)

A) The need to manage the competitive position is an example of an 'external direct trigger' for change.
B) The skills, abilities and competences of the organization's employee's are a 'hard' factor according to the McKinsey 7 S model.
C) The change would be classified as a 'revolutionary change' according to Balogum and Hope Hailey.
D) Understanding which day-to-day behaviors to reinforce within the training programme, is about 'routines and rituals' according to the Cultural Web.
E) The plans to combat competition would be considered as a 'structure' factor according to the McKinsey 7 S model.

2. BCA is a long established international airline. Which of the following represent Threats to BCA's business?
(Choose all that apply.)

A) A shortage of trained pilots in BCA.
B) A substantial rise in the price of oil.
C) Greater popularity of long-haul holidays.
D) A higher level of private car ownership.
E) A sudden increase in international terrorism.

3. When FarmCot Foods was founded five years ago, it was a small shop set up by a family of dairy farmers in a disused farm shed, selling their own produce to the local community. The family had decided, at that point in time, to diversify their dairy farming activities into also selling their own milk, cheese and ice cream products.
The aim was to increase their revenues, as dairy farming in their home country had been in decline for a number of years.
Since then, the shop has been very successful and has expanded rapidly over the last three years, due largely to a strong growth in tourism in its home country and a shift in consumer demand for locally sourced fresh farm products. FarmCot Foods is now located in a large purpose-built building on the site of the original farm shed and also operates a very popular cafa, a children's play area and sells a much wider range of products and gifts, which are all sourced from local suppliers.
Which of the following best describes FarmCot Foods approach to strategy development in the last five years?

A) Incremental
B) Freewheeling opportunism
C) Emergent
D) Rational

4. Plush is a medium-sized hotel which recently opened on the outskirts of a city which is popular with tourists. It has a sophisticated website which allows customers to pre-book rooms and additional items, such as meals in its restaurant and tickets for popular tourist attractions in the city.
Plush has listed its website on a popular hotel price comparison website, which allows customers to compare prices and facilities of hotels in the same area and this has resulted in over 60% of Plush's customer bookings so far.
Since listing on the price comparison website, the Sales Manager of Plush has noticed that the prices offered by its nearest competitors have reduced dramatically and their range of special offers have also increased.
Which TWO of Porter's Five Forces have been most affected by the use of the price comparison website by the hotels in the same area as Plush? (Choose two.)

A) Bargaining power of suppliers.
B) Competitive rivalry.
C) Bargaining power of customers.
D) Threat of new entrants.
E) Threat of substitutes.

5. DRAG DROP
PQ is an international airline.
In accordance with Porter's Value Chain, select "Primary" or "Support" for each of the activities listed below:
Select and Place:

Correct

Solutions: