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CIMA CIMAPRO15-E03-X1-ENG Exam Syllabus Topics:

CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. 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 consider the likely consequences of any decision in the long term.
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 be responsible for keeping all external stakeholders satisfied.

2. Plush is a medium-sized hotel which recently opened on the outskirts of a city which is popular with tourists. It has a sophisticated website which allows customers to pre-book rooms and additional items, such as meals in its restaurant and tickets for popular tourist attractions in the city.
Plush has listed its website on a popular hotel price comparison website, which allows customers to compare prices and facilities of hotels in the same area and this has resulted in over 60% of Plush's customer bookings so far.
Since listing on the price comparison website, the Sales Manager of Plush has noticed that the prices offered by its nearest competitors have reduced dramatically and their range of special offers have also increased.
Which TWO of Porter's Five Forces have been most affected by the use of the price comparison website by the hotels in the same area as Plush? (Choose two.)

A) Competitive rivalry.
B) Threat of new entrants.
C) Bargaining power of customers.
D) Threat of substitutes.
E) Bargaining power of suppliers.

3. 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) Divest product T1 and Harvest product T5.
C) Harvest both product T1 and product T5.
D) Harvest product T1 and Divest product T5.

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

5. 'Big data' refers to datasets whose size is outside the ability of typical database software tools to capture, store, manage and analyze.
Which of the following statements is NOT a valid statement with regard to 'big data'?

A) Sufficient analytical and managerial talent is available to exploit the opportunities associated with 'big data'.
B) The definition of 'big data' can vary by sector, depending on the software tools and dataset sizes common to a particular industry.
C) 'Big data' will require the right infrastructure, incentives and safeguards to address public concerns.
D) As technology advances overtime, the size of datasets that qualify as 'big data' will also increase.

Solutions: