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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. According to Porter's Five Forces model, which of the following would be evidence of high buyer power?

A) Products are not standardized and buyers cannot easily switch to another product.
B) There is a low probability of backward integration.
C) Buyers are fragmented and act independently of each other.
D) There is a concentration of buyers.

2. A leading retail chain is undertaking environmental scanning as it is concerned that it is becoming uncompetitive and profits have started to fall. The Board of Directors is concerned that it will need to have a viable strategy to present to its shareholders at the next annual general meeting, in order to prevent shareholders' protests.
The company has been reluctant in the past to offer an Internet shopping service. It now believes, however, that by offering this service and introducing customer relationship marketing (CRM), this will produce a strategy that will help it to improve its competitiveness.
Which of the following statements apply to CRM? (Choose all that apply.)

A) The company must be prepared to take customers' needs into account and be able to meet these needs.
B) CRM is about marketing to customers to obtain their loyalty, so customer research is not needed.
C) In mature markets, existing customers provide the most likely source of future earnings.
D) The CRM process needs to include increasing the range of products that will be offered to customers.
E) CRM utilizes marketing resources to retain, rather than simply attract new customers.

3. Directors have a duty to shareholders and other stakeholders and are required to promote the success of the company.
Which THREE of the following are valid roles and responsibilities of directors? (Choose three.)

A) To be responsible for keeping all external stakeholders satisfied.
B) To focus only on maximizing company profits.
C) To avoid conflicts of interest and of duties.
D) To have regard for the interests of the company's employees.
E) To consider the likely consequences of any decision in the long term.

4. Country W hosts a large music competition every 5 years, which is attended by many international musicians.
The success of the competition is dependent upon effective Customer Relationship Marketing being established with many different market groups around the world. These include music colleges who send their students, broadcasting companies who broadcast the event on radio and television, audience members, online ticket sellers and music journalists who write about the competition in specialist journals.
Using Payne's 'Six Markets Model', which of the following is the correct classification for the music journalists writing about the competition?

A) Customer market
B) Supplier market
C) Influence market
D) Referral market

5. You have been given responsibility, as a newly qualified management accountant, for delivering an ambitious project to centralize and computerize the accounts function within a medium-sized, geographically dispersed business. The timetable also requires the project to be delivered within a very short timescale with limited resources. You have built a team to deal with these proposed changes.
With regard to effective teams and change, which THREE of the following statements are correct? (Choose three.)

A) Teams enhance learning and address change directly through creating recommendations and new ideas.
B) Individuals must become more than they were when working alone and must develop new commitments and behaviors.
C) Teams play minor roles in institutional change.
D) Teams should continue after their purpose has been served.
E) Teams that cross departmental boundaries can destroy shared values.
F) Teams that cross departmental boundaries can develop new performance criteria.

Solutions: