2nd Semester (Repeat)

Strategic Management Examination (MBA 402)

Duration 2 hours
Total 40 Marks / Closed book

Instructions to candidates
You are allowed two hours to answer this question paper.
You are allowed 10 minutes reading time before the examination begins
during which you should read the question paper and, if you wish,
highlight and/or make notes on the question paper. However, you will not
be allowed, under any circumstances, to open the answer book and
start writing or use your calculator during the reading time.
You are strongly advised to carefully read ALL the question requirements
before attempting the question concerned (that is all parts and/or subquestions).
ALL answers must be written in the answer book. Answers or notes written
on the question paper will not be submitted for marking.
Section A 10 Compulsory Questions. (20 Marks)
Section B 05 Compulsory Questions. (30 marks)
Section C Contains 2 questions and you may select one.(50 marks)
Write your candidate number, the paper number and examination subject
title in the spaces provided on the front of the answer book.
Please indicate the questions you have attempted on the front Right hand
Corner of the Answer book

Strategic Management Examination (MBA 402)

Duration 2 hours
Closed book
Learning outcome

Evaluate and reflect on the influences driving demand within the business to
consumer and business to business markets and the factors influencing the
strength of their influence

Gain insights into relationships of the characteristics of markets to business

performance

Section A Each Carry 2 Marks

1) What do you understand by the term 'strategic drift'?
A) Emergent approach to strategy
B) Progressive failure of strategies to address the strategic position of the organization
C) Sudden failure of strategies to address the strategic position of the organization
D) Where an intended strategy is unrealized

2) What is meant by an organizations strategic capability?

A) This refers to an organizations ability to think strategically rather than get bogged down
in
Day-to-day operational detail
B) The adequacy and suitability of the resources and competences of an organization for it
to
survive and prosper
C) The capability to respond effectively to the competitive threat posed by rivals
D) The ability to undertake effective strategic analysis and develop strategy

3) What does RBV stand for?

A)

Resource based value

B)

Real book value

C)

Resource based view

D)

Realizable book value

4) Which of the following is not a requirement for sustained competitive advantage?

A) Customer value
B) Robustness
C) Rarity
D) Non-substitutability
E) Good supplier relationships
5) Which of the following is not an argument in favor of corporate social responsibility?
A) Large organizations should concentrate on what they are good at, which is wealth
creation,
and help society through the creation of jobs and incomes.
B) Large organizations exert so much influence on the lives of people (i.e. jobs, product
safety,
the environment, health and safety at work, etc.) that they must be held accountable as part
of
a democratic society.
C) Organizations control such large amounts of resources that they can destabilize national
economies by moving these resources to another country and so their decision-making must
be more transparent.
D) Large organizations influence many aspects of our lives, such as education, the
environment,
Health care and housing, and so should be made legally responsible in respect of these
issues.
E) To avoid corruption and ensure the law is upheld, decision-making processes and other
Corporate governance issues should be transparent.

6) What term is used for the underlying principles that guide an organisation's strategy?

A) Aims B) Core values C) Vision D) Mission

7) Which of the following is not one of the criteria for assessing the robustness of strategic
capability?
A) Path dependency
B) Complexity
C) Culture and history
D) Causal ambiguity
E) Benchmarking

8) Which of the following is not an intangible resource?

A) Quality control procedures
B) Legal permissions
C) Contract agreements
D) Patent registrations
E) Culture

9) Which of the following best defines dynamic capabilities?

A) An organizations ability to maintain its position as the most cost efficient in its
Industry/sector
B) An organizations ability to develop and change its staff if they fail to meet the
requirements
of the managers
C) An organizations ability to develop and change competences to meet the rapidly
changing
needs of customers
D) An organizations ability to develop and change competences to meet the needs of
rapidly
Changing environments

10) What is not part of Supporting Activities in Porters Value chain

A) Procurement
B) Human Resources
C) Technology
D) Marketing and Sales
E) Infrastructure

Section B
Write Short Answers not exceeding 75 words
Each will carry 6 Marks
1.
2.
3.
4.
5.

Vision and its importance

Strategic Capabilities
Power Stakeholders
Organic Growth
Value Networks

Section C
1. A. Using any model of your preference identify the relevant stakeholders of
a FMCG Multinational operating in Sri Lanka and suggest how you would
communicate with the relevant stakeholders.
(30
Marks)
B. CSR is becoming a nice to have model critically evaluate?
(20 Marks)
2. SecurityNet(SN) is a medium-sized IT software company. It is based in Asia,
but distributes and sells its products world-wide.
It develops products on its own and then sell them thro customer awareness
and promotions.
At present SN has 24 products at various stages of development and has only
three
products that are actually on the market.
ESTAR is a product which is used in modern buildings to monitor access
control and has been available for six months and has achieved significant

success. Sales of this product are not expected to increase from their current
level.
SECURITY is a staff attendance program. It was introduced more than three
years ago, and has become one of the leading products in its class. But since
there are many competitive products in the same category, this is not
expected to grow further.
APTSEC very specialized and used in Airports for identifying baggage and
tracking them. It
was launched only three months ago, and has yet to generate a significant
sales volume.
The directors of SN meet every month to review the product portfolio and to
discuss possible
investment opportunities. At their next meeting, they are to be asked to
consider three
investments. Due to a limited investment budget, the three investments are
mutually exclusive
(that is, they will only be able to invest in ONE of the options). The options
are as follows:
The directors can invest in a new version of SECURITY, SECURITY, which
offers improved
performance. This will allow SN to maintain the level of sales achieved by
SECURITY for an additional three years.
The directors can invest in a major marketing campaign, to promote the use
of APTSEC to
specialist airport staff. While this investment should lead to a significant
growth in the sales
of APTSEC , SN is aware that one of its competitors is actively promoting a
rival product with
similar performance to that of APTSEC.
The directors can invest in completion of PUBLIC. This is a breakthrough
product, as it has no near rivals on the market. PUBLIC is used in the public
sector enterprises and it would help these enterprises to serve the public
more effectively and efficiently.
(A) Critically examine and briefly explain how the product life cycle model can
be used to analyze the current
Product portfolio of SN (that is, BEFORE the planned investment).
(25 Marks)
(B) Evaluate the potential impact of each of the three investment options
(SECURITY, APTSEC
and PUBLIC) on the product portfolio of SN
(25 Marks)

Answers

Section A Each Carry 2 Marks

1) What do you understand by the term 'strategic drift'?
A) Emergent approach to strategy
B) Progressive failure of strategies to address the strategic position of the organisation
C) Sudden failure of strategies to address the strategic position of the organisation
D) Where an intended strategy is unrealised

2) What is meant by an organisation's strategic capability?

A) This refers to an organisation's ability to think strategically rather than get bogged down
in
day-to-day operational detail.
B) The adequacy and suitability of the resources and competences of an organisation for it
to
survive and prosper
C) The capability to respond effectively to the competitive threat posed by rivals
D) The ability to undertake effective strategic analysis and develop strategy

3) What does RBV stand for?

A) Resource based value B) Real book value
C) Resource based view D) Realisable book value

4) Which of the following is not a requirement for sustained competitive advantage?

A) Customer value
B) Robustness
C) Rarity

D) Non-substitutability
E) Good supplier relationships
5) Which of the following is not an argument in favour of corporate social responsibility?
A) Large organisations should concentrate on what they are good at, which is wealth
creation,
and help society through the creation of jobs and incomes.
B) Large organisations exert so much influence on the lives of people (i.e. jobs, product
safety,
the environment, health and safety at work, etc.) that they must be held accountable as part
of
a democratic society.
C) Organisations control such large amounts of resources that they can destabilise national
economies by moving these resources to another country and so their decision-making must
be more transparent.
D) Large organisations influence many aspects of our lives, such as education, the
environment,
health care and housing, and so should be made legally responsible in respect of these
issues.
E) To avoid corruption and ensure the law is upheld, decision-making processes and other
corporate governance issues should be transparent.

6) What term is used for the underlying principles that guide an organisation's strategy?
A) Aims B) Core values C) Vision D) Mission

7) Which of the following is not one of the criteria for assessing the robustness of strategic
capability?
A) Path dependency
B) Complexity
C) Culture and history
D) Causal ambiguity

E) Benchmarking

8) Which of the following is not an intangible resource?

A) Quality control procedures
B) Legal permissions
C) Contract agreements
D) Patent registrations
E) Culture

9) Which of the following best defines dynamic capabilities?

A) An organisation's ability to maintain its position as the most cost efficient in its
industry/sector
B) An organisation's ability to develop and change its staff if they fail to meet the
requirements
of the managers
C) An organisation's ability to develop and change competences to meet the rapidly
changing
needs of customers
D) An organisation's ability to develop and change competences to meet the needs of
rapidly
changing environments
10) What is not part of Supporting Activities in Porters Value chain
A) Procurement
B) Human Resources
C) Technology
D) Marketing and Sales
E) Infrastructure

Section B
Write Short Answers not exceeding 75 words
Each will carry 6 Marks
Vision and its importance
Ability to link vision, mission with goals!. Why organization exist? How the
organization goals reflect on Vision, How it guides the managers etc
Strategic Capabilities
Resources and Competencies, Obtained, Sustained, Resources alone will not work.
Power Stakeholders
Who is important, any example to show the importance of the stakeholders in
different situation
Organic Growth
Grow by yourself vs other modes. Benefits and disadvantages
Value Networks
Supplier to Customer, the benefit, The Definition..

Section C
1. A . Using any model of your preference identify the relevant stakeholders of a
FMCG Multinational operating in Sri Lanka and suggest how you would
communicate with the relevant stakeholders.
(30 Marks)
Mend lows widow, power and interest (10)
Identified stakeholders with justification (10)
Analysis how to communicate with them (10)
B. CSR is becoming a nice to have model critically evaluate?
(20 Marks)
Whats CSR? (5)
Why CSR? (5)
Examples of negative aspect and Positive aspect Aruguments(10).

Section C
2. A

Growth
Introduction
Maturity Decline
Development

The product life cycle - five phases; development, introduction, growth,

maturity and decline.(if student has included Shakeout-Industrial?)
A balanced portfolio of products Products in all stages of the life cycle with
sufficient profit and cash generation to meet the organisations requirements.
For SN, the current product portfolio is as follows:
Development 24 Products
Introduction/early growth APTSEC
Early maturity ESTAR
Late maturity SECURITY
The product portfolio of SN appears, at first sight, to be fairly well balanced.
In order to make a
definitive judgement, it would be necessary to have further information about
the likely success
rate of development projects and the relative sales and profit/cash profiles of
its products
2 (B)
Investment options
The three investments can be evaluated as follows:
SECURITY Investing in Security will allow SN to reposition SECURITY to
the early maturity stage of the product life cycle. This investment is likely to
below risk. This will have a positive effect on the product portfolio, as it will
allow SECURITY to continue to generate significant cash flows for a further
three years, unless a superior rival product is launched.
APTSE C An investment in marketing for Beta should lead to sales growth
and therefore take the product from the introduction stage to early maturity.
However, there are two major risks. Firstly, the marketing programme may
not succeed, and sales revenues may not be significant enough to pay back
the investment. Secondly, any investment may be wasted if a rival product is
subsequently launched.
PUBLIC This is the highest risk investment. Even with the investment, there
is no certainty that PUBLIC will be acceptable for a particular sector only..
However, the returns from any breakthrough product likely to be very
significant.