SECTION A: CASE STUDY QUESTION 1 Adansifo Company Ltd was established in 1987 in Accra.

Its founder was a Mechanical Engineer who decided to use his skills to build a company to produce aluminium products. The company has since its inception limited its operations to the production of aluminium roofing sheets. Its distribution outlets are concentrated in the Greater Accra Region. The company employed a number of sales persons who were assigned territories in newly developed suburbs. It also employed competent engineers and had dedicated factory operatives. By 1997, Adansifo Company Ltd had emerged as the leader of the industry. The Board of Directors anticipated that the industry would witness new trends by the year 2004 key among which would be the influx of imported roofing products on the Ghanaian market. But the management did not do anything to forestall the situation. By 2005, the government had launched its affordable housing scheme. This coupled with the expansion in housing delivery by real estate developers saw a number of new companies including foreign ones, entering the industry. Adansifo Company Ltd lost two of its key engineers to one of the new companies. The companys financial performance for the period 2004 to 2006 is shown as exhibits 1 and 2. Exhibit 1 Adansifo Company Limited Profit and Loss Account for the years ended 31st December 2006 GH000 1,000 (675) 325 (129) (57) (100) 39 (9) 30 (60) 24 2005 GH000 1,000 (662) 338 (124) (64) (122) 28 (8) 20 (50) 15 2004 GH000 1,000 (653) 347 (126) (79) (144) (2) (8) (10) (10)

Sales Cost of sales Gross profit Selling and Distribution Costs Administrative expenses Directors Remuneration Operating Profit/(Loss) Interest payable and similar charges Profit/(Loss) on ordinary activities before taxation Taxation Retained profit for the year

Exhibit 2 Adansifo Company Limited Balance Sheets as at 31st December; 2006 GH000 891 570 722 1,292 488 110 598 694 (585) 1,000 462 538 1,000 2005 GH000 1,006 542 680 10 1,232 420 129 549 683 (689) 1,000 544 456 1,000 2004 GH000 1,252 483 585 1,068 416 149 565 503 (755) 1,000 596 404 1,000

Fixed assets Current assets Stock Debtors Cash Trade Creditors Overdraft Creditors: Amounts due within one year Net current assets Creditors: Amounts due after more than one year Capital and reserves: Share capital Reserves

The Directors of Adansifo Company Ltd think that the market has become much more competitive. New technologies are available for the production of aluminium roofing sheets. Roofing sheets made of other materials are also common in the market, leading to decline in Adansifos market share. At a recent strategic planning retreat of the management of the company, proposals were made for the company to diversify its products, explore the possibility of exporting its products and entering into a strategic alliance with one of its competitors. All the proposals will depend upon careful analysis of the internal and external factors of the company and analysis of its financial statements. The Board is however highly optimistic that all is not lost. It has therefore engaged you as a consultant to advise on the way forward. You are required to: a. b. Conduct a SWOT analysis of the company. (8 marks)

Suggest three (3) growth strategies the company can pursue giving reasons for your answers. (12 marks)

c. d.

Explain four (4) merits of exporting as an international market entry strategy. (12 marks) Comment on the liquidity and efficiency of the company. (8 marks) (Total: 40 marks)

SECTION B: ESSAY Attempt any three (3) questions from this Section QUESTION 2 (a) (b) What is value chain analysis? (5 marks)

Using an organization with which you are familiar, describe how the concept can be used to gain competitive advantage. (15 marks) (Total: 20 marks)

QUESTION 3 Discuss the key activities involved in strategy formulation (20 marks)

QUESTION 4 (a) The purpose of analyzing any industry is to assess its attractiveness for investment. Discuss four (4) factors which may make an industry attractive. (12 marks) With appropriate examples explain two entry barriers to an industry with which you are familiar. (8 marks) (Total: 20 marks) 3

(b)

QUESTION 5 (a) (b) What are critical success factors? (4 marks) Using the brewery industry as an example, explain any four (4) critical success factors that can be used by firms to achieve competitive advantage. (16 marks) (Total: 20 marks)