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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. PQR is a charity which has an excellent reputation within its home country. PQR employs over 300 highly experienced staff and has 200 skilled volunteers. PQR's funding mainly comes from donations from the public but its public profile is low compared to larger, more publicized charities.
Due to a recent recession, public donations to PQR have fallen in the last five years, but demand for its services continues to grow.
The government of the country in which PQR operates is encouraging greater collaboration between charities and there have been several recent successful mergers within the charity sector. PQR has recently been approached by a high profile and well funded charity, DDD, with a merger proposal. DDD offers complementary services to those offered by PQR.
Which TWO of the following factors would most likely be considered as an "opportunity" for PQR? (Choose two.)

A) Donations from the public
B) Highly experienced staff
C) Merging with DDD
D) The excellent reputation of DDD
E) Growing demand for its services

2. Ansoff has provided a product/market growth matrix which denotes possible strategic directions that an organization can follow.
Which of the following statements correctly describe the strategic options generated by the matrix? (Choose all that apply.)

A) Diversification using new products in new markets.
B) Product development using new products in new markets.
C) Market penetration using new products within existing markets.
D) Market development using existing products in new markets.
E) Market penetration using existing products within existing markets.
F) Market penetration using existing products in new markets.

3. DDD is a business which sells entertainment products and now wants to move to a position where it uses ebusiness as a fundamental part of its business strategy.
Which of the following benefits would result from DDD's use of e-business? (Choose all that apply.)

A) Easier access to loan finance.
B) Cost reductions because of lower overheads and cheaper procurement.
C) Better control of information through monitoring website activity.
D) A reduction in labour turnover and higher morale.
E) Increased online revenues.
F) An increased use of tacit knowledge.

4. DRAG DROP
YZ is a family-run business which manufactures and sells confectionery, employing almost 100 staff. It operates 10 shops in small towns in the north of country P.
Sales of YZ's products have decreased over the last 4 years due to competition from large supermarkets, internet shopping and a general economic downturn, which has hit the north of country P especially hard.
YZ's managing director has recently retired and the board decided to fill the vacancy with an external appointment. The new managing director plans to invest in new manufacturing technology, which would cut staffing levels by 15% and reduce wastage, allowing YZ to lower its prices. YZ's staff are very unhappy about these proposals, feeling that they will destroy YZ's family tradition and reputation that has developed over many years.
Select the correct descriptor for each of the forces for change below:
Select and Place:

Correct

5. RRR is a medium sized company, which has built family homes in Country D' for twenty years. The Board of RRR wishes to expand company operations and start building homes in the neighboring country. The Board of RRR wishes to undertake a position audit to help in this decision.
Which of the following strategic analysis tools would be used in a position audit for RRR?

A) Gap Analysis
B) Five Forces
C) SWOT
D) PEST

Solutions: