SECOND OPPORTUNITY EXAMINATION PAPER

Transcription

1 naml BIA UniVERSITY 0 F SCIEnCE AnD TECH no LOGY Faculty of Management Sciences Department of Management 13 Storch Street Private Bag Windhoek NAMIBIA T: F: E: dml@nust.na W: QUALIFICATION: Bachelor of Business Administration QUALIFICATION CODE: 21BBAD COURSE: Strategic Business Management: Analysis & Decision DATE: January 2016 DURATION: 3 Hours LEVEL: COURSE CODE: SBM422S SESSION: PAPER 1 MARKS: 100 SECOND OPPORTUNITY EXAMINATION PAPER EXAMINER: Mr. C Van Zyl MODERATOR: Mr. R Ritter THIS EXAMINATION PAPER CONSISTS OF 6 PAGES (INCLUDING THIS FRONT PAGE) INSTRUCTIONS 1. Answer all questions. 2. Read all the questions carefully before answering. 3. Section A and B should be answered in the examination book provided. 4. Question 1 to 25 of Section A should be answered on the attached multiple choice answer sheet. 5. Choose only one option when answering the multiple choice questions. 6. Include the Multiple Choice Answer Sheet in your Examination Answer Book.

2 SECTION A 1. The parameters used in the Grand Strategy Matrix are: A Market growth & Competitive position B Relative market share & Competitive position C Industry sales growth & Financial position D Environmental strengths & Competitive position 2. The EPS/EBIT analysis is used to: A Distinguish between two alternative integration strategies B Calculate the sales tax of an enterprise C Decide which financing option would be the best D The amount of earnings lost to the Revenue office E None of the above 3. In the IE Matrix the following inputs are applied: A CA& ES B IFE & EFE C FP& IS D RMSP & ISGR% E All of these 4. Related diversification as a strategic option could be associated with: A Rapid market growth & Weak competitive position B Rapid market growth & Strong competitive position C Weak competitive position & Slow market growth D Strong competitive position & Slow market growth E B+C+D 5. EPS in the EPS/EBIT analysis is calculated by: A Dividing EBIT with the amount of tax calculated B Subtracting the no. of outstanding shares from EBIT C Multiplying the no. of outstanding shares with EAT D Dividing EAT by the no. of outstanding shares 6. In the BCG Matrix, the Stars are typically associated with: A Horizontal integration B Divestiture C Retrenchment D Liquidation 7. In the SPACE Matrix where FP = +4; CA = -4; ES =-1 and IS= +2, then the vector will be drawn in the: A B C D E CA /FP quadrant FP/ES quadrant FP/IS quadrant ES/CA quadrant None of these 8. A suggested strategy associated with coordinates (0, 15; -15) in the BCG Matrix: A Market development B Market penetration C Backward integration D Liquidation 9. The reason for using the QSPM is to: A Identify environmental variables that influence enterprise performance B Distinguish between alternative strategic options C Calculate the rating and the weighting of relevant variables D Outsmart competitor advantage 10. In the QSPM the highest Sum Total Attractiveness Score has the following meaning: A Alternative strategies do not match this option B It could not be divided by the lowest alternative attractiveness score C Competitors cannot beat your best option D Suppliers should be aligned to this option to provide lower prices 11. In the SWOT Matrix the best probability of a suitable strategy could come from: A Combining strengths with opportunities B Combining weaknesses with opportunities C Combining strengths with threats D Combining weaknesses with threats E It does not really matter; any combination could produce a suitable strategy 12. The following aspects should ideally be used to select the best alternative strategy: A Power/ProfiUPossession B Equity/EnvironmenUEiimination C Social/Environmental/Economic D People/Power/Profit E B+C 13. Criteria that would distinguish between the best and the second best option: A B C D E Quantity/lnfluence/ProfiUPossession Quantity/CosUSpeed/Service level Quality/Service orientation/cosuspeed of delivery Ethical orientation; Networking; Politics; Possession Natural environment; Personal environment; Personal gain 2

3 14. An approach that adds value to overall satisfaction and good conduct include: A Me first/you second B Always serve others without expecting to be served yourself C We live now and have to receive maximum from the overall system now D Tomorrow is for others; today is for me 15. Considering the following comparative values of an EPS/EBIT analysis, the best option would be: A 1, 56 B 0,99 c 1, 57 D 1, In the IE Matrix "Grow and Build" strategies are associated with x- & y- axis coordinates: A (1, 25; 2, 50) B (2, 50; 1, 25) c (3, 50; 1, 00) D (1, 00; 3, 50) E (3, 00; 3, 00) 17. "Question Marks" in the BCG Matrix would typically have the following coordinates: A (0, 75; -5) B (0, 75; 0) c (0, 25;-15) D (0, 25; +10) E (0, 25; 0, 25) 18. SPACE Matrix suggested strategies when x- & y-axis coordinates are (-4; +5): A Conservative B Aggressive C Competitive D Defensive 19. The market share of XYZ was N$123 million in 2008 and N$456 million in Then the market growth rate was: A 0, 73% B 73% c 7,3% D 0, 073% 20. The duties and responsibilities of Boards of Directors exclude: A Focusing on profit maximization for shareholders rather than consideration for societal and/or environmental "disturbances" B Control and oversight of management C Adherences to legal prescriptions D High regard for all stakeholders' rights 21. In the Product Positioning Map the following parameters are used: A Speed of service & Cost B Cost& Quality C Quality & Service delivery D Quality and Speed of delivery 22. Rumelt's criteria for evaluating the implementation of strategies exclude: A Competitive advantage B Consonance C Consistency D Feasibility 23. IS and IS are about: A Quality Management Systems B Design for Environment (DFE) C Corporate Social Responsibility D Environmental Sustainability 24. Disadvantages of global trading : A Economies of scale B Competitor intensity C Higher complexity D A+B+C E B+C 25. This is an example of a strategic objective (versus financial objective): A B C D E Gaining x percent market share Profit margin of x percent An x percent return on shareholders' equity A+C B+C Subtotal: 25 Marks (One mark for each correct answer) 3

4 SECTION 8 Question 1 Calculate EPS 5195 and EPS in order to determine the best financing option for a public company with an annual gross income of N$ This company pays tax at a rate of 42%. The Bank has agreed to finance a loan of N$ at an interest rate of 15%. Any amount exceeding the N$ would be financed by the Bank at an interest rate of 18%. The company however needs capital to the amount of N$ to finance a machine for the manufacturing of "common sense" which is in great demand at some tertiary institutions. With a share price of N$56 and the number of shares outstanding being , what recommendations would you have for the company regarding the best financing options? Question 2 A panel of business experts was asked to evaluate the performance of a company in Namibia's tourism industry. The panel considered four scenarios which reflect the 1) financial strengths, namely: a) does the company have access to development capital, and b) can the company increase the cash flow consistently by more than 10% per month. On the latter scenario ratings of three (+3) and one (+1) were allocated for each (on a scale of 0 to +6); 2) economic stability, namely: a) is the economy currently in a consistent growth phase, and b) the economic expectations for the next three years does not look that promising now. On the latter scenario ratings of minus three (-3) and minus five (- 5) were allocated for each (on a scale of 0 to -6). The panel furthermore considered the company's 3) competitive position by evaluating a) the company's competitive performance over the last two years, and b) current brand value. On the latter scenarios ratings of minus one (-1) and minus three (-3) were allocated for each (on a scale of 0 to -6); and 4) industry strengths by evaluating a) the average contribution of this industry to the gross domestic product (GOP) relative to other industries, and b) the customer service levels in this industry, and c) the sustainable management practices of Government and relevant role players to preserve and conserve the Namibian ecosystems. On the latter scenarios ratings of plus four (+4); plus one (+1 ), and plus two (+2) were respectively allocated for each (on a scale of 0 to +6). a) Apply your knowledge of the SPACE Matrix to calculate a set of coordinates from the information provided above in order to plot and draw a vector in an appropriate quadrant on a SPACE Matrix. (30) (1 0) 4

5 b) Define each of the recommended strategies that are associated with the quadrant in which the vector was plotted above. (5) Question 3 Critically evaluate the advantages and disadvantages of centralized versus decentralized decisionmaking of a typical Namibian company. (20) Question 4 Why is a strategy supportive culture important for strategy implementation? (10) Subtotal: 75 Marks Total Marks: 100 5

6 Subject code: Student number: Surname: Initials: Date: Lecturer Name: FT/PT/Distance I Multiple Choice Answers I A 8 c D E