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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. A is a private healthcare organization aiming to provide affordable and accessible high quality patient services.
A is introducing Big Data, which has not yet been adopted by the competition. A's database will store a huge amount of information about its patients. Clear access to wide sources of accurate information will enable patients to make more informed choices. Patients will be able to compare not only the prices of drugs, treatments and physicians but also their relative effectiveness.
Which of the following concerns should A have about its use of Big Data?

A) Veracity of information
B) Variety of information
C) Lack of competitive advantage
D) Privacy issues

2. Company TTT produces a range of products, including products T1 and T5.
Product T1: Profitability has declined in recent years, although small profits continue to be made as the market contracts due to changing customer preferences. Overall market share is low and continues to reduce.
However, in addition to external sales T1 is also used as a component of product T5.
Product T5: A market leader within a low growth market, sources components both externally and from TTT's other subsidiaries. T5 benefits from significant economies of scale and TTT has recently considered modernizing its T5 production line but following a cost benefit analysis, decided not to proceed.
Which of the following is an appropriate strategy for TTT to adopt?

A) Divest both product T1 and product T5.
B) Harvest both product T1 and product T5.
C) Divest product T1 and Harvest product T5.
D) Harvest product T1 and Divest product T5.

3. Which THREE of the following issues relate to the Corporate Strategy of an organization? (Choose three.)

A) Meeting the needs of key customers.
B) Leaving existing industries.
C) Entering new industries.
D) Avoiding competitive disadvantages.
E) Achieving advantage over competitors.
F) Acquisitions, disposals and diversification.

4. JJJ is a publically quoted advertising agency. JJJ's competitive advantage is based on the expertise of its staff and its reputation in digital media advertising. JJJ has robust systems to protect its intellectual property. These include patents and copyrights. JJJ has also restricted access for most of its staff to its most sensitive data, such as studies of its customers' profitability.
JJJ's new Managing Director, Z, is concerned that when staff leave JJJ, the company loses whatever tacit knowledge they possess. These losses also impact on JJJ's reported profits. In order to remedy the losses of knowledge and the reduced profits Z wants to introduce a knowledge management strategy.
Which of the following steps support the introduction of a knowledge management strategy? (Choose all that apply.)

A) Z should set a target for reported profit.
B) JJJ should convince staff of the benefits of sharing their tacit knowledge.
C) Z should gain the support of the Board of Directors.
D) JJJ should integrate knowledge management and management accounting.
E) JJJ should unfreeze current habits and standard operating procedures.
F) JJJ needs to acquire and install appropriate hardware and software.

5. Which of the following would be a suitable performance measure of Internal Business Processes within Kaplan and Norton's 'Balanced Scorecard' model?

A) Reduction in manufacturing cycle times.
B) Higher P/E ratio.
C) Increase in market share.
D) New products developed.

Solutions: