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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. HH is an outdoor theatre which is based in the capital city of country N.
Tickets for shows can be booked at the ticket office or online. HH has identified the following critical success factors (CSFs):
An excellent, online ticket booking system
Customer satisfaction
Which of the following would be suitable key performance indicators (KPIs) for HH? (Choose all that apply.)

A) Percentage of ticket bookings aborted before completion.
B) Number of returning customers each year.
C) Number of customer complaints.
D) Profit from sales of snacks and drinks.
E) Customer show ratings, scored out of ten.
F) Employee turnover.

2. TUV had an employee turnover rate of 25% among new recruits and was becoming short of skilled workers.
The Board of TUV realized there was something dramatically wrong and called in consultants to assess the problem. The consultants recommended transformational change in that TUV should redesign the entire production system, change the placement of all equipment and the flow of work, redefine every job and give all workers new assignments.
Which type of change did the consultants recommend for TUV?

A) Revolution
B) Evolution
C) Adaptation
D) Reconstruction

3. As a CIMA qualified management accountant working within a manufacturing company, you are subject to both CIMA's Code of Ethics and your company's Code of Business Conduct.
Which TWO of the following statements are TRUE? (Choose two.)

A) Both CIMA's Code of Ethics and the company's Code of Business Conduct include references to Confidentiality. Disclosure on public interest grounds is therefore prohibited.
B) A company's Code of Business Conduct can be rules based.
C) As a CIMA qualified Management Accountant you must follow CIMA's Code of Ethics.
D) Where there is a difference between CIMA's Code of Ethics and the company's Code of Business Conduct, the company's Code of Business Conduct takes priority.
E) Both CIMA's Code of Ethics and the company's Code of Business Conduct must be based on a set of basic principles.

4. STU is a hospital that is wholly funded by its national government. In the last five years it has seen its funding cut by over 30% due to budgetary pressure on the government, caused by a global recession. As a result, the senior management team of STU has had to make some very difficult decisions about prioritizing how it spends the funds it receives from the government. Its main strategies have been to reduce the number of administration staff and nursing staff by 20%, in order to reduce its costs. It has also stopped providing a number of services to patients, including its counselling services and its physiotherapy unit.
Which of the following strategies has STU adopted to manage its reduced funding? (Choose all that apply.)

A) Divestment
B) Turnaround
C) Facilitation
D) Retrenchment
E) Liquidation

5. GV is a manufacturer and retailer of high quality suede gloves. GV makes all of its sales in country F, and is extremely profitable. After many successful years trading, GV has accumulated significant cash reserves and would like to grow the business organically.
After some investigation work, GV has discovered an opportunity to sell leather shoes in country P.
Which of the following strategic directions is GV taking if it pursues this opportunity, according to Ansoff's product / market matrix?

A) Related diversification
B) Market penetration
C) Market development
D) Product development

Solutions: