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MBA Comprehensive Exam

Handling Steps

MBA Comprehensive Exam Handling Steps

Tips for the MBA comprehensive Exam

The selected strategies should be supported by justification
It’s very important to consider the compatibility between the selected strategies with the
financial position (gathered from financial ratios) “i.e. don’t follow integration strategies
if the financial position is bad”.
The Selected Strategies Business/Grand mustn’t be contradicting “i.e.: you can’t
o Cost leadership business strategy and in the same time Product development (R&D)
Grand strategy.
o Focus business strategy and in the same time use integration Grand strategy.
o Differentiation business strategy and in the same time use Defensive Grand strategy.
Consider always to use Intensive Strategies (Market penetration & Market development
– less costly) rather than integration Strategies (vertical & horizontal integration – need
excellent financial position)
Porter five forces assessment may be excluded if it wasn’t needed to answer the exam
questions like:
Do you think that this market is attractive? Or what do you think about competition?
Time management is the most important issue – the exam will be a 5 hours exam, use
the first hour for reading the case and the questions then use the remaining four hours in
writing the analysis, matching, decision and conclusion, you can follow the following
steps to handle the exam within this time span:

Page 2 Exam Handling Template

MBA Comprehensive Exam Handling Steps

Overview for the Suggested steps & time span to handle the Exam

1. ( 5 Min) Start by reading the Questions for the purpose of reorder the questions hence
concentrate on the related parts from the case and the unrelated parts to be excluded.

2. (10 Min) Read the case “Screening” again to identify the unrelated parts to be excluded

3. (35 Min) Read the case carefully focusing on the parts that are related to the questions, using 4
different colored markers highlight the similar Factors i.e. Opportunities, Threats,
Strengths and Weaknesses.

4. (10 Min) Writing a introduction “Abstract” that may involve the following topics:

About the company (Background & History), Products Range, Geographical domination/market,
SBUs, divisions, Territories, industry, customer branding, competitors, competitive advantage

5. (60 Min) The input phase (Strategy Formulation) – involving internal & External Scanning to
form SWOT:
1. Vision
2. Mission
3. Assessing of the External and Internal environment within the step 3” as
i. Mega or Societal Environmental Scanning: PEST assessment.
ii. Task or Industry Environmental Scanning: Porter five forces assessment.
(Proter five forces when asked only, when you have to choose between two
markets or to whether enter a new market or not.
iii. External Audit outcome: is an ordinal list of gathered external factors;
“Opportunities and Threats” Weighted (Sum =1) according to their
importance & Ranked (1-4) according to the degree of achieving, listed in an
EFE Method (where for each Opportunity or threat the weighted score = weight
* rank).
Internal Environment scanning:

A. Organization Structure encompass:
 Simple
 Functional

Page 3 Exam Handling Template

Boston consulting group – BCG. e. Grand Matrix 7. Tangible Assets b. (60 Min) The Output phase (Decision) – involving selecting the suitable plans in the following levels: a. R&D g. Financial Analysis – including comment and interpretation on each ratio. Resource Based view a. Organizational Strategies. Manufacturing j. Conclusion/ Epilogue ‫“ الخاتمة‬involving what’s expected when applying the selected strategies” Page 4 Exam Handling Template . listed in an IFE method. B. Organizational Functions d. 6. Organization Culture and values C. e. Internal Audit: is an ordinal list of gathered Internal factors. Your Recommendations to solve any problems 9. SPACE Matrix c. Business and functional Strategies (Competitive strategies) c. Marketing analysis and decision using strategic model “i. Operations h. “Strengths and Weaknesses” Weighted (Sum =1) according to their importance & Ranked (1-4) according to the degree of achieving. SWOT/TWOS d. Structure Changes. b.. (30 Min) The Matching phase – List all suitable plans through using one of the matching tools: a. BCG” f. Intangible Assets c. Information Systems i. Managerial Capabilities D.e. (Marketing Plan and HR Plan)(Implementation if asked) 8. MBA Comprehensive Exam Handling Steps  Divisional  Matrix  Network structure. IE Matrix b. Human Resources E.

Branding  SBUs and Divisions  Culture  Competitors. 1. production of plays. MBA Comprehensive Exam Handling Steps Detailed steps to handle the Exam 1. The main competitors are XXX & XX. main challenges ” i. Vision Write the Actual Vision for the purpose of evaluation hence develop a new one according to the following criteria: Achieving Unrealistic No available resources No time frame No commitment to achieve it Page 5 Exam Handling Template . The Company operates in the business of Entertainment concerned with organizing event. Europe. competitive advantage.e. The company makes approximately ## varieties of the Entertainment product. Writing an introduction “Abstract” First point four steps and a in the fifth step was clearly fulfilled in the previous page involving About the company– following is an example:  “The Company name & website (www. The Company is led by CEO XXX whose base pay was $###K in 20##. The Company. Competitive situations. The firm’s major competitor is privately-owned XX and conglomerate giant XX”. Australia and much of Middle east. music and films as well as promotions product in the United (Background & History)  Type of Business/ Industry  Products/services Range  Geographical domination/markets  Market Size  Customers.

and the community (6) in which we operate. We deploy the latest technological (9) and superior customer care (7) systems to continually create better services for our customers (1). Mission Write the Actual Mission to be evaluated: Criteria Consistency Consistent with the vision Credibiity Saying what we are doing Clarity Self-explained/ No jargon Orientation Product oriented or customer oriented Length Not too long= Boring. External Audit: This analysis is to end up with writing a list of: Threats and Opportunities Page 6 Exam Handling Template . we strive for fairness.Growth – Maturity – Decline) Components Customers Who are the firms customers? Products or Services What are the firms major products or services Industry Market Geographically where does the firm competes Employees Are employees a valuable asset for the company Technology Philosophy Public Image Self-Concept Survival/ Growth / Profits If it matches the strategic direction and fulfill the criteria then keep the mission as it is. MBA Comprehensive Exam Handling Steps Perceds Mission statement Future oriented Clear and Short Challenging If the criteria are achieved and it matches the strategic direction of the company then keep the vision if not change it Example: “To become the leading producer of Entertainment Services in the world” 2. We work for profits to investors (5) as we provide comfort work zone to our employees (8). and integrity (4)”. Not too short= Vague Life cycle (Start . And in everything we do. and if not adjust the mission and ad the missing elements Example: “To be the world’s (3) leading Entertainment Company focused on organizing Events & Producing movies (2). 3.

opportunity and what is unfavorable for the organization i.  E-commerce  Changes in tax laws.L assessment External term refers to outside the organization. structure. Governmental. divorces. Demographic. and deaths. and sex  Monetary policies  Air pollution  investment laws and regulations. MBA Comprehensive Exam Handling Steps “External refers to outside the organization.S.e. Cultural.  Internet availability and usage  Government regulations & deregulations. age. some of things beyond our control. and regional distribution of the  The GDP and income level (which population directly reflects on consumer  Cultural fear or freedom level spending power)  Cultural symbol (status)  The currency depreciation or  What’s socially acceptable? appreciation  Wages level  price elasticity of demand Political. and Economic forces Environmental forces:  Availability of credit and saving  Number of marriages.e.T. and Legal forces: Technological forces:  Political stability.  size.  Level of disposable income  Social security programs  Interest rates  Per capita Income  Inflation rates  Lifestyle  Unemployment  Traffic congestion  Stock Market trend  Trust in government  Foreign countries’ economic  Average level of education conditions  Population changes by race. Page 7 Exam Handling Template . threats Social. some of things beyond our control" Mega or Societal Environmental Scanning: P.E. E. births.  Political conditions in foreign countries  Substitute might replace the organization’s product. PEST Analysis is all about you get to assess each factor and every perspective in the mega or in the societies environment from which you can extract what is Favorable for your organization i.  The rate of development  Level of government subsidies  The presence of skilled persons  Country to other countries relationships  Presence of technological  Trading policies& Import-export regulations capabilities.

f. Embargo &Quota e. Political stability and stability of the government b. that a government may levy around the fiscal year and it may affect the business environment (economic environment) to a great extent. Trading policies& Import-export regulations k. Political factors include a. [For example] a government may impose a new tax or duty due to which entire revenue generating structures of organizations might change. Economic factors include: a.  The major strengths and relative position of each competitor. [For example] a rise in the inflation rate of any economy would affect the way companies’ price their products and services. Adding to that.  Size of government budgets  The relations with other countries Competitors :  The structure. Government regulations & deregulations. The relations with other countries 2. Size of government budgets o. Boycott. d. Fiscal policy c. strategies and the level of profitability of each competitors. Facilities for the entrance for new foreign investment. Level of government subsidies( )‫الدعم‬ i. Global relationships j. Changes in tax laws and policies g. MBA Comprehensive Exam Handling Steps  Facilities for the entrance for new foreign investment. n. Political conditions in foreign countries/ stability l. severity if government protest (‫)االرهاب واالحتجاجات‬ m. customs and taxes) etc.  The objectives. Political: These factors determine the extent to which a government may influence the economy or a certain industry. Economic: These factors are determinants of an economy’s performance that directly impacts a company and have resonating long term effects. it would affect the purchasing power of a consumer and change demand/supply models for that economy. Pressure groups h. bases and intensity of competition. Terrorist activity.  The existing major competitors and any competitive advantage. 1. GDP/GNP Page 8 Exam Handling Template .  The market share level. Special Tariffs &Trade tariffs (tariffs.

Foreign exchange rates o. Mortality rate Page 9 Exam Handling Template . Age distribution e. MBA Comprehensive Exam Handling Steps b. and gauge determinants like cultural trends. Disposal income is the amount of money that households have available for spending and saving after income taxes have been accounted for. demographics. Population growth rate d. Money Supply d. Job. a. It also accounts for the FDI (foreign direct investment) depending on certain specific industries who’re undergoing this analysis. Social Class (Education. Reevaluation k. Price control i. Disposable personal income is often monitored as one of the many key economic indicators used to gauge the overall state of the economy. Energy costs and availability l. Life expectancies f. The currency depreciation or appreciation (‫)انخفاض قيمة العملة‬ v. An example for this can be buying trends for Western countries like the US where there is high demand during the Holiday season. Birth rate g. Economic growth patterns etc. Interest Rates c. Price elasticity of demand u. Life Style changes c. Propensity of people to spend (standard of living) t. Investment laws and regulations Level of disposable income s. population analytics etc. Monetary policies 3. Availability of credit w. Stock Market trend x. Foreign countries’ economic conditions y. Inflation rate e. Availability of credit and saving q. Income) b. Income level (which directly reflects on consumer spending power) n. m. Monetary policies r. p. Wages level h. Social: These factors scrutinize the social environment of the market. Devaluation j. Unemployment Level f. Exchange Rate g.

Cultural symbol (status) What’s socially acceptable? cc. sex and religion bb. Examples: a. Attitudes toward quality t. Technological: These factors pertain to innovations in technology that may affect the operations of the industry and the market favorably or unfavorably. Number of women and minority workers x. Cultural fear or freedom level aa. The rate of development i. Traffic congestion ee. MBA Comprehensive Exam Handling Steps h. and regional distribution of the population z.Population changes by race. Customs m. Buying habits v. Page 10 Exam Handling Template . Social Security programs. Consumer behavior r. Language j. The presence of skilled persons j. research and development and the amount of technological awareness that a market possesses. structure. Availability of certain Technology need to improve productivity (Presence of technological capabilities) f. Substitute might replace the organization’s product. Religious orientation i. Etiquette n. divorces w. Attitudes toward saving s. Government Spending on R&D b. Childbearing rates p. Dress k. Trust in government 4. Working hours l. Industry Spending on R&D c. Telecom infrastructure e. y. This refers to automation. Aesthetics o. Immigration & emigration rates q. age. Internet availability and usage g. Attitudes toward customer service u. E-commerce h. size. Patent protection d. Marriages. The attitudinal changes towards business (product / services) produced dd.

Consumer laws b. Labor laws d. There are certain laws that affect the business environment in a certain country while there are certain policies that companies maintain for themselves. Trade License i. Endangered species ‫األنوا ع المهددة باالنقراض‬ Page 11 Exam Handling Template . geographical location. a. Safety standards c. environmental offsets etc. Ozone depletion f. Customer Protection Law (Law of Negligence) 6. For example: a. farming. Waste management d. agriculture etc. Factors of a business environmental analysis include but are not limited to climate. Legal: These factors have both external and internal sides. Air and water pollution b. Legal analysis takes into account both of these angles and then charts out the strategies in light of these legislations. global changes in climate. Governmental regulation c. MBA Comprehensive Exam Handling Steps 5. Environmental: These factors include all those that influence or are determined by the surrounding environment. Competition law e. Contract law f. Environmental protection law g. Ethical concerns e. This aspect of the PESTLE is crucial for certain industries particularly for example tourism. Changes in patents(‫ )التراخيص‬laws h. weather.

STEP.C Task Env. and the strength of a position you're considering moving into. because it helps you understand both the strength of your current competitive position. These are: Page 12 Exam Handling Template . This is useful. MBA Comprehensive Exam Handling Steps Task or Industry Environmental Scanning: Porter five forces “Task or industry environment is the type of the environment you may control its factors somehow” The Porter's Five Forces tool is a simple but powerful tool for understanding where power lies in a business situation. Porter 5 Forces Organisation Internal Env. Societal Env. It is used to determine whether to enter a certain market or not or to choose between two markets. “Porter five forces assessment may be excluded if it wasn’t required explicitly to answer questions in exam like do you think that this market is attractive? Or what do you think about competition?” Five Forces Analysis assumes that there are five important forces that determine competitive power in a business situation.

MBA Comprehensive Exam Handling Steps New Entry Barriers  Economies of scale  Time and cost of entry  Product differentiation  Switching costs  Large Capital requirement  Technology protection/ The need to gain technology and specialized knowhow  Access to distribution Channels/ Lack of adequate distribution channels  Government Policy (taxes and customs)  The need to gain economic of scale quickly  The lack of experience  Strong customer loyalty  Strong brand preference  The potential saturation of market. or if you have little protection for your key technologies. then you can preserve a favorable position and take fair advantage of it. If you have strong and durable barriers to entry. Power is affected by the ability of people to enter your market. if there are few economies of scale in place. pricing. If it costs little in time or money to enter your market and compete effectively. and marketing can overcome barriers. then new competitors can quickly enter your market and weaken your position. Rivalry among Competition (existing firms): Intense rivalry related to: Conditions That Cause High Rivalry Among Competing Firms  High number of competing firms  Similar size of firms competing  Similar capability of firms competing  Falling demand for the industry’s products  Falling product/service prices in the industry  When consumers can switch brands easily  When barriers to leaving the market are high  When barriers to entering the market are low Page 13 Exam Handling Template .  Economies of product differences  Brand equity  Absolute cost advantages  Learning curve advantages  Expected retaliation Overall result for threats of new entry: Attractive/not attractive ** Quality.

Rivalry Among Competing Firms Most powerful of the five forces Focus on competitive advantage of strategies Threat of substitute  Availability of substitutes  Substitute performance  Switching costs  Relative price of substitute products declines  Buyer propensity ‫ ميل‬to substitute  Perceived level of product differentiation Overall result for threat of substitute products: Attractive/not attractive ** Firm’s plans for increased capacity & market penetration Page 14 Exam Handling Template . Fragmented)  Rate of industry growth  Product or service characteristics (quality)  Amount of fixed costs  Capacity  Regulation of competition  Customer loyalty  Informational complexity and asymmetry  Brand equity  Fixed cost allocation per value added  Level of advertising expense Overall result for intensity of competitive rivalry: Attractive/not attractive ** Focus on competitive advantage of strategies What is important here is the number and capability of your competitors. then you can often have tremendous strength. MBA Comprehensive Exam Handling Steps  When fixed costs are high among firms competing  When the product is perishable  When rivals have excess capacity  When consumer demand is falling  When rivals have excess inventory  When rivals sell similar products/services  When mergers are common in the industry  Number of competitors (Monopoly. if no-one else can do what you do. and they offer equally attractive products and services. then you'll most likely have little power in the situation. On the other hand. If you have many competitors. Monopolistic Competition. because suppliers and buyers will go elsewhere if they don't get a good deal from you.

then this weakens your power. If substitution is easy and substitution is viable. this is driven by the number of buyers. If you deal with few.  Changing supplier’s costs very little.  A buyer earns low profits and is thus very sensitive to costs and service differentiation. Again.  The purchased product is unimportant to the final quality or price of a buyer’s products or service. the cost to them of switching from your products and services to those of someone else. powerful buyers. and so on.  Buyer information availability  Ability to backward integrate  Availability of existing substitute products  Buyer price sensitivity  Price of total purchase Here you ask yourself how easy it is for buyers to drive prices down. prices.  Alternative suppliers are plentiful ( ‫ )وافر‬because the product is standard or undifferentiated. then they are often able to dictate terms to you. MBA Comprehensive Exam Handling Steps This is affected by the ability of your customers to find a different way of doing what you do – for example. When customers are: Page 15 Exam Handling Template . the importance of each individual buyer to your business. thus providing incentive to shop around for a lower price. if you supply a unique software product that automates an important process. Potential Development of Substitute Products Pressures increase when consumer’s switching costs decrease Firm’s plans for increased capacity & market penetration Bargaining power of Buyers  Buyer buys large portion of seller’s product  Buyer can integrate backward  Undifferentiated product  Availability of sellers (Competitors and substitutes)  Buyer orientation (price oriented vs quality oriented)  Switching costs  Low quality or high price Consumers gain increasing bargaining power under the following circumstances:  If they can inexpensively switch to competing brands or substitutes  If they are particularly important to the seller  If sellers are struggling in the face of falling consumer demand  If they are informed about sellers’ products. people may substitute by doing the process manually or by outsourcing it. and costs  If they have discretion (‫ )تقدير‬in whether and when they purchase the product.  The purchase product represents a high percentage of a buyer’s costs.

and so on. or not capable of meeting a firm’s needs on a consistent basis) ** However. too costly. their strength and control over you. the uniqueness of their product or service. This is driven by the number of suppliers of each key input.  cost of inputs relative to selling price of the product  Overall result for bargaining power of suppliers: Attractive/not attractive ** Backward integration can gain control or ownership of suppliers (This strategy is especially effective when suppliers are unreliable. the cost of switching from one to another. the more powerful your suppliers are. When suppliers are: Page 16 Exam Handling Template . The fewer the supplier choices you have. who specialize in such components and have huge economies of scale. in many industries it is more economical to use outside suppliers of component parts than to self-manufacture the items. MBA Comprehensive Exam Handling Steps • concentrated • large • buy in volume Bargaining Power of Buyers Customers concentrated or buy in volume affects intensity of competition Consumer power is higher where products are standard or undifferentiated Bargaining power od suppliers  Number of suppliers and buyers (Petroleum) (few suppliers higher power)  Suppliers product characteristics (unique or commodity – quality) unique (higher power)  Switching costs/ High switching cost (higher power)  Availability of substitutes/ Substitutes are not easily available (higher power)  Suppliers forward integration/ Real threat of forward integration from supplier (high power)  Amount purchased from supplier (large quantities)  Product is critical for the business (higher power)  The target industry is NOT important to the supplier (higher power)  supplier switching costs relative to firm switching costs  degree of differentiation of inputs  presence of substitute inputs  supplier concentration to firm concentration ratio  Threat of forward integration by suppliers relative to the threat of backward integration by firms. and the more you need suppliers' help. Here you assess how easy it is for suppliers to drive up prices.

MBA Comprehensive Exam Handling Steps • Few suppliers who supply the required products • The products have few substitutes • The switching cost is relatively high Bargaining Power of Suppliers Large number of suppliers & few substitutes affects intensity of competition Backward integration can gain control or ownership of suppliers A supplier is powerful if some of the following factors apply Low number of suppliers and many buyers High power of suppliers High differentiation or switching cost High power of suppliers Low availability of substitutes High power of suppliers High ability of supplier to integrate forward High power of suppliers Example: Self Assessment—Bargaining Power of Suppliers 1 Are there a large number of potential input suppliers? NO 2 Are the products that we need to purchase for our business ordinary? NO 3 Do our purchases from suppliers represent a large portion of their business? YES 4 Would it be difficult for our suppliers to enter our business? YES 5 Can we easily switch to substitute products from other suppliers? NO 6 Are we well informed about our supplier’s product and market? NO Final Assessment: Bargaining Power of Suppliers STRONG Self Assessment—Bargaining Power of Buyers 1 Do we have enough customers such that losing one isn’t critical to your success? YES 2 Does our product represent a small expense for our customers? YES 3 Are customers uninformed about our product and market? NO 4 Is our product unique? NO 5 Would it be difficult for buyers to integrate backward in the supply chain? YES 6 Is it difficult for customers to switch from ours to our competitors’ products? NO Final Assessment: Bargaining Power of Buyers MEDIUM Self Assessment—Threat of New Entrants 1 Do we have a unique process that has been protected? YES 2 Are customers loyal to our brand? NO 3 Are there high start-up costs for our business? YES 4 Are the assets needed to run our business unique? NO Page 17 Exam Handling Template .

MBA Comprehensive Exam Handling Steps 5 Is there a process or procedure critical to our business? YES 6 Will a new competitor have difficulty acquiring/obtaining needed inputs? YES 7 Will a new competitor have any difficulty acquiring/obtaining customers? NO 8 Would it be difficult for a new entrant to have enough resources to compete ? NO Final Assessment: Threat of New Entrants MEDIUM Self Assessment—Threat of Substitutes 1 Does our product compare favorably to possible substitutes? YES 2 Is it costly for our customers to switch to another product? NO 3 Are customers loyal to existing products? NO Final Assessment: Threat of Substitutes STRONG Self Assessment—Rivalry Among Competitors 1 Is there a small number of competitors? YES 2 Is there a clear leader in our market? NO 3 Is your market growing? YES 4 Do we have low fixed costs? NO 5 Can you store your product to sell at the best times? YES 6 Does our competitors pursuing a low growth strategy? YES 7 Is your product unique? NO 8 Is it easy for competitors to abandon their product? YES 9 Is it difficult for customers to switch between our product and our competitors’? YES Final Assessment: Rivalry Among Competitors LOW Porter Five Forces Attractiveness of the market Rivalry Attractive / Not Attractive New Entry Attractive / Not Attractive Substitutes Attractive / Not Attractive Buyer Power Attractive / Not Attractive Supplier Power Attractive / Not Attractive Page 18 Exam Handling Template .

11.Regardless of the number of key opportunities and threats included in an EFE Matrix. 9. cultural. List the opportunities first and then the threats. Example: Page 19 Exam Handling Template . using percentages. social.Sum the weighted scores for each variable to determine the total weighted score for the organization. 5. The weight indicates the relative importance of that factor to being successful in the firm’s industry. but threats can receive high weights if they are especially severe or threatening. legal.0 (very important). including both opportunities and threats. 8.0 and the lowest possible is 1. After the previous External factors scanning “highlighted with the marker throughout the case” start to List key external factors as identified in the external-audit process. Assign to each factor a weight that ranges from 0.0 (not important) to 1. All the factors that act with low priority will be excluded I will only deal with the factors with high and medium priority. Assign a rating between 1 and 4 to each key external factor to indicate how effectively the firm’s current strategies respond to the factor. The sum of all weights assigned to the factors must equal 1.0 7. 4. 2. whereas the weights are industry-based. 3. Multiply each factor’s weight by its rating to determine a weighted score. Ratings are based on effectiveness of the firm’s strategies. It is important to note that both threats and opportunities can receive a 1. governmental. environmental. technological. 2. and comparative numbers whenever possible. ratios. MBA Comprehensive Exam Handling Steps External Factor Evaluation Matrix External Factor Evaluation (EFE) Matrix: EFE Allows strategists to summarize and evaluate economic. Be as specific as possible. demographic. Ratings are thus company-based. 3. Opportunities often receive higher weights than threats. Appropriate weights can be determined by comparing successful with unsuccessful competitors or by discussing the factor and reaching a group consensus. the highest possible total weighted score for an organization is 4. 6. 10. and competitive information 1. that affect the firm and its industry. political. or 4. Include a total of 15 to 20 factors. where: 4 = the response is superior 3 = the response is above average 2 = the response is average 1 = the response is poor.

14 1. Page 20 Exam Handling Template .0 indicates that an organization is responding in an outstanding way to existing opportunities and threats in its industry. Co-operation with competitors as Elsewedy’s favored customers may backfire if the latter switch loyalties 0.16 3. Middle Eastern and North African nations such as Syria. Wind Energy is a promising division which promotes 0.00 3.08 3 0.5. If TWS= 2.48 2. The acquisition of Iskraemeco has expanded opportunities 0.5-onwards means that your organization is in a good external position.12 4 0.08 3 0. Excess capacity from Egypt can be channeled to the newly 0.10 2 0. MBA Comprehensive Exam Handling Steps Key External Factors Weight Rating Weighted (assumption) (assumption) Score Opportunities 1.24 emerging European market 4. with the advantage of 0.21 could be attractive for backward integration 6.10 4 0. and Algeria are turning out to be profitable markets 3. A total weighted score of 4.07 2 0. Expansion into the European market connotes the risk of tackling new cultures 0.24 generation of alternative power Threats 0. Italy and Spain could be risky markets in terms of relationships with Egypt Total 1.08 3 0.08 2 0. 0.48 tariff-free transportation across EU nations 2.24 Saudi Arabia.20 4. Egypt’s varied natural resources and industrial products 0. your organization is able to capitalize all its external opportunities and avoid all its external threats. A total score of 1.12 4 0.e.07 3 0.10 4 0. i.19 Summation must =1 No Total Summation weighted score (TWS) = Σ Weight x Rate Comment The average total weighted score is 2.40 for electrical services 7.40 expansion into Europe 5. In other words.0 indicates that the firm’s strategies are not capitalizing on opportunities or avoiding external threats. the firm’s strategies effectively take advantage of existing opportunities and minimize the potential adverse effects of external threats. The company faces competition from five local and six international firms 0. The financial crisis has proved to be an opportunity for 0. The European market is promising.

and its limitations. grouped and coordinated. its capabilities. Organization Structure  Refers to how job tasks are formally divided. relationships and communication channels linking individuals and groups in the organization]  Structure changes as environnemental conditions change  Usually we choose between two types of structure Functional or Divisional structure. b. For example. Objectives and policies are stated largely in terms of products in an organization whose structure is based on product groups. objectives and policies established under a geographic organizational structure are couched in geographic terms. Changes in strategy often require changes in the way an organization is structured for two major reasons.72 suggests that Moderna is aware of the opportunities and threats it faces. structure largely dictates how objectives and policies will be established. However. a. [A system of tasks reporting. MBA Comprehensive Exam Handling Steps Less than 2. First. the response is still tentative. and firm Internal Scanning 4. Page 21 Exam Handling Template . that many opportunities your organization is not able to capitalize on or take advantage of and many threats you cannot avoid. The structural formula for developing objectives and policies can significantly impact all other strategy-implementation issues. Example: The total weighted score of 2. and has embarked on a serious review of its potential for growth. The second is that structure dictates how resources will be allocated.5 to 1 it means that your organization is in a weak external position. Internal Audit 1.

MBA Comprehensive Exam Handling Steps Selecting an organizational structure 1.  Minimizes career development opportunities. expertise.  In depth training and skill development within each function.  Sometimes characterized by low employee morale.) Page 22 Exam Handling Template . R&D.  High quality in solving technical problems.  Allows rapid decision-making.  Promotes in-depth functional expertise(specialization of labor)  Enhances operating efficiency where tasks are routine. and computer information systems. marketing.  Clear career paths. sharing similar responsibilities in similar areas of interests (each one in his own areas of expertise) groups tasks and activities by business function such as product/operations. The Functional Structure:  Groups together people with similar skills.  Functional coordination problems. (Minimizes the need for an elaborate control system). DISADVANTAGES  It forces accountability to the top. (Problems are moved forward to the upper level for solving). finance/accounting. (Lack of coordination.  Typically work well for small organization producing few products or services in a relatively predictable environment with low demand of innovation or change President Vice President Vice President Vice President Vice President Marketing Production HR Finance ADVANTAGES  is the simplest and least expensive  Centralized control of operations.

profits. geographical.  Unclear responsibilities in areas such as innovation. Process: Catalog Sales Manager (Group of related tasks creating something of a value to the customer) Product Order  Is similar to a functional structure. Product or service: General Manager (Allows high degree of accountability as costs. customer. organization is expanding to cover wider geographical areas. Geographic area: (or area structure) (common in international operations allowing to focus more on cultural and Middle East European regional differences or when the product need to be differentiated on the Division Division basis of areas)  is appropriate for organizations whose strategies need to be tailored to fit the particular needs and characteristics of customers in different geographic regions. failures. MBA Comprehensive Exam Handling Steps  Inter-functional rivalry (may lead to internal conflict)  Overspecialization and narrow viewpoints  Hinders development of cross-functional experience  Slower to respond in turbulent environments (communication and problem solving across functions this can result in slowing the decision making process and problem solving. Divisional Structure: [Product. successes are clearly identified) Personal  Is most effective for implementing strategies when specific products or Food care product services need special emphasis. Complex organization producing multiple and differentiated products with diversified strategies and who are working in different competitive environments. because activities are organized Purchasing fulfillment according to the way work is actually performed. 3. product quality. 2. 2. The divisional structure can be organized in one of four ways: President 1. Page 23 Exam Handling Template . process]  Groups together people that work together on the same product or process serve the same customer or located within the same geographic areas  Typically work well for The organization is managing diverse product line.

 Clear point of responsibility for product delivery and quality.  Each business is organized around products. (may lead to internal conflict)  Corporate managers may lose in-depth understanding.  Creates career development opportunities for managers. Customer. MBA Comprehensive Exam Handling Steps 4.  Facilitates rapid response to environmental changes.  Improved cross functional coordination. increase deficiencies as resources and efforts are duplicated). (requirements of each customer is different) Industrial Consumers Division Division With a divisional structure.  Allows new businesses and products to be added easily (flexibility in changing size by adding or deleting divisions). functional activities are performed both centrally and in each separate division.  Inter-divisional rivalry. DISADVANTAGES  May lead to costly duplication of functions.( increase costs. ADVANTAGES:  Decentralized decision making.  Puts profit/loss accountability on manager. Page 24 Exam Handling Template .  Focused expertise on customers/ products/ regions.  Allows efficient management of a large number of units.

 The role of the group vice president is often ambiguous. which increases salary expenses. Typically used when: Any size A unique mission Identifiable competitors External market focus Control over its business functions (E. programs or regional needs. Typically used in: Multinational organizations to offer a flexibility to deal with the regional differences as well as the multi products. DISADVANTAGES:  It requires an additional layer of management. instead of organizing food on the basis of the packaging technology: canned. The Strategic Business Unit (SBU) Structure (a recent form of the divisional structure) Divisions or group of divisions composed of independent product-market segments that are primary responsibility and authority for the management of their own functional areas. Common solution for the organizations that pursues the growth strategies in a dynamic and complex environment Scarce resources Ideas need to be cross fertilized across projects External environment is very complex and changeable Page 25 Exam Handling Template .G. The matrix is formed by using permanent cross functional teams to integrate functional expertise in support of a clear divisional focus on project. It is designed to gain the advantage and minimize the disadvantages of the functional and divisional structures. packed they are divided according to the customer segments they serve) ADVANTAGES: This change in structure can facilitate strategy implementation by improving coordination between similar divisions and channeling accountability to distinct business units. 4. The SBU structure groups similar divisions into strategic business units and delegates authority and responsibility for each unit to a senior executive who reports directly to the CEO. MBA Comprehensive Exam Handling Steps 3. product or program. The Matrix Structure The matrix structure (sometimes called the matrix organization) it combines the functional and divisional structure.

Projects can be shut down easily. There are many channels of communication. project manager who is fully informed and available to answer all and every enquiries. Page 26 Exam Handling Template . MBA Comprehensive Exam Handling Steps  Functional & product form are combined simultaneously at the same level.  Workers belong to 2 formal groups: a functional and a project (or program or product) team. Steps  Better customer service since there is always a program.  Employee have 2 superior. Hand   Workers can see visible results of work.   ling Better inter-functional cooperation in operations and problem solving. removing and changing operations to meet changing demands. Increased flexibility in adding. MBA General Manager Manager of Projects Manufacturing Manager Com Engineeri ng Manager Sales prehManager ensivFunctional personnel assigned to both projects and coordinating with their e functional departments ADVANTAGES: Exam   Project objectives are clear. product. functional superior & horizontal product manager (reporting to 2 bosses one within the functions and the other within the team).

shared authority. Mature matrix: A true dual authority structure. 5. Temporary cross functional task forces: Project manager is in charge as the key horizontal link 2. DISADVANTAGES:  It is the most complex of all designs because it depends upon both vertical and horizontal flows of authority and communication. Product or brand management: The functional is still the primary organizational structure. where the best information is available. ** Distinct phase exist in the DEVELOPMENT OF matrix structure 1. project managers. Network structure Warehouse Off-shore Supplier manufacturing and packaging firm Business Core Furniture Page 27 Exam Handling Template .  It also creates dual lines of budget authority. MBA Comprehensive Exam Handling Steps  Better performance accountability through the program.  Improved strategic management since top management levels are freed from unnecessary problem solving to focus time into strategic issues. product.  boss system could create a conflict between the two in exercising power and authority  Strong teams loyalties could cause losing the focus on the larger organizational goals.  Improved decision making as problem solving takes place at team level. 3. functional & product structure are permanent. and dual reporting channels.  It can result in higher overhead cost because it creates more managerial positions. product manager act as integrator of semi permanent product or brand. dual sources of reward and punishment. adding team leaders cause increase in costs.

DISADVANTAGES:  With large size it is often difficult to maintain control over the network of relationships and contracts. Used when the environment is unstable The organization operates with a central core business linked to outside suppliers and contractors by a networks of relationships that utilize the latest tech.  If one part of the network fail to deliver.  Increased operations efficiency and therefore increasing competitiveness.(single point of flair) 6.  Reducing costs overheads. ADVANTAGES:  Rapid response time  Firm’s emphasize their own core competencies  Very flexible  Reduces capital intensity  Allowing the firm to operate with less employees. Reebok. the same concept can be used in large organizations such as in the case of outsourcing. Team Structures: Page 28 Exam Handling Template .  A more simplified internal systems. Benetton use the network structure on their operation functions by subcontracting manufacturing to other companies in low cost location around the world. MBA Comprehensive Exam Handling Steps  Many activities are outsource  Series of independent firms or business units that are linked together by computers in an IS Nike. Emerged as a result of information and communication technology (sort of boundary less organizations or virtual corporations) Very suitable for entrepreneurial and small firms. to engage in strategic alliances and business contracts sustaining operations without the costs of owning all the functions.  no geographical boundaries. the whole system will fall.

Members are coming from different functional working closely together to improve performance or solve a problem  Pros: solve the problem of lack of coordination and communication across function. and values learned and shared by a corporations’ members and transmitted from one generation of employees to another. expectations.  Generates employee commitment to something greater than themselves. Organizational Culture It is the collection of beliefs. 2. synergies are expected as people having different technical expertise work together. Corporate Culture has two distinct attributes:  Intensity: The degree to which members of a unit accept the norms. (depth)  Integration: The extent to which units throughout an organization share a common culture. values or other culture content associated with the unit.  Cons: difficulty for team members to balance between the team and the function assignment. (breadth) Importance:  Conveys a sense of identity for employees. passing too much time in meeting – time – that is not always productive. improve the quality and the speed of the decisions making process. Page 29 Exam Handling Template . boost the morale as people from different part of the organization are working together. MBA Comprehensive Exam Handling Steps Uses extensively permanent and temporary cross-functional teams to improve lateral relations.

The company must be Page 30 Exam Handling Template . Rites.Socially constructed preferences .Shared ways of responding to something new Norms . Stories. characteristic of USA – Poly-chronic style individuals focus on several things at one time. MBA Comprehensive Exam Handling Steps  Adds to the stability of the organization as a social system  Guide for appropriate behavior. characteristics of Latin American countries Dimensions of Cultural Differences Research has shown that countries differ significantly in – Interpersonal trust – Power-distance – Avoidance of uncertainty – Individualism v. Creation of Organizational Culture  Beliefs and values of the organization’s founder  Societal norms of firm’s native/host country  Problems of external adaptation and survival  Problems of internal integration Cultural Differences Research on pace of life in various countries suggest that Westerners have fairly precise measures of time and a stronger concern for punctuality than most other people – Mono-chronic style individuals focus on one thing at a time.Feelings & beliefs about what’s good or right Shared Assumptions . ceremonies .Not conscious . approaching a task . Most easily changed . legends .Preferred states .Hard to change Culture and Technology In order to create a more innovative corporation. rituals. stories that represent the culture .Taken for granted . Collectivism Artifacts/Symbols Visible objects. Group expectations about how things should be done Values . Symbols . top management must develop an entrepreneurial culture that is open to the transfer of the new technology into company activities and products and services. actions. myths. Language/jargon/gestures Behavior Patterns Shared ways of interacting.

France. It should include a willingness to withstand a certain percentage of product failures on the way to success. etc. and having challenging work to do to derive a sense of accomplishment.Informal structure 4. physical condition. In countries where uncertainty avoidance is weak (the US. Italy. Therefore. Solidarity is organic (all contribute to a common goal. people are expected to look out for themselves. Values include training. Long-term versus Short-term orientation Page 31 Exam Handling Template . Femininity versus Masculinity Hofstede’s study suggested that men’s goals were significantly different from women’s goals and could therefore be expressed on a masculine and a feminine pole. people tend to value having a high opportunity for earnings. Mexico.Decentralized decision making 3. the Netherlands. Singapore. a culture tends to perceive unknown situations as threatening so that people tend to avoid them. Japan. Uncertainty avoidance When uncertainty avoidance is strong. Britain) people feel less threatened by unknown situations. 5. Examples include South Korea. Power distance Power distance measures how subordinates respond to power and authority. Innovative organizations should have the following characteristics: 1. Typical values are personal time. Israel. people tend to value a good working relationship with their supervisors. Hong Kong. culture has five dimensions 1. See Appendix 2 for comments on differences between American and Chinese society on this dimension. risk. the use of skills.Interconnectedness 5. Where feminine values are more important (Sweden. working with people who cooperate well with one another. having an opportunity for advancement to a higher-level job. Great Britain). freedom. In high-power distance countries subordinates tend to be afraid of their bosses. subordinates are more likely to challenge bosses and bosses tend to use a consultative management style.Private attitude towards change 2. 4. Where the masculine index is high (US. MBA Comprehensive Exam Handling Steps flexible and accepting of change. Denmark. Hong Kong. and bosses tend to be paternalistic and autocratic. 2. living in an area desirable to themselves and to their families. In low-power distance countries. and challenge. Collectivism versus Individualism In individualistic countries. Indonesia). they tend to be more open to innovations. but with little mutual pressure) rather than mechanical.System Openness According to Geert Hofstede's Model. Japan. 3. In collectivist cultures individuals are bounded through strong personal and protective ties based on loyalty to the group during one’s lifetime and often beyond (mirrored on family ties). and Latin America. and having the security that they will be able to work for their company as long as they want. getting the recognition they deserve when doing a good job.

a respect for tradition. favors and gifts. and a sense of shame. skills and connections to the firm? And if the firm has international operations do they have international experience?  What is there level of involvement in strategic management?(refer to board continuum Example:  The number of directors.  One-insider member members. Chairman. MBA Comprehensive Exam Handling Steps A long term orientation is characterized by persistence and perseverance. the Philippines. ………………. Taiwan. a protection of one’s reputation. President.. Germany. Australia 3. Trademarks. Top Management Page 32 Exam Handling Template .  …………. Tangible Assets Assets Equipment/ Machinery Raw Materials/ Supplies Plant/ Factory Location/ Buildings Capital B. Managerial Capabilities Board of Directors:  Who are they. do they have different voting rights and for how long they are serving on the board?  Do they contribute knowledge. do they own shares. thrift.  Main names mentioned in the case:  …………. Countries include China.. Resource Based View RBV A. Countries include: Britain. Trade Secrets. and a reciprocation of greetings. Japan and India A short-term orientation is marked by a sense of security and stability. are they internal or external. Canada. Patents) C. Intangible Assets Training Experience Knowledge Brand Name/ Equity/Value Skills/ Creative ability Reputation Intellectual Property (Copy Rights. a respect for a hierarchy of the status of relationships. Hong Kong.

Participative or Democratic shows high concern for both people and task. Often called the democratic leadership style. 4. 3. No one challenges the decisions of autocratic leaders. Turn most decisions over the work group and show less interest in the work process or its results. gives directions and expect his orders to be followed. Directive or Autocratic(Dictatorial) High concern for task and low concern for people. MBA Comprehensive Exam Handling Steps  Who are the top managers and what are their characteristics in terms of knowledge. Supportive leader Shows high concern for people and low concern for tasks. Creative employees who thrive in group functions detest this leadership style. ……. he was the driving engine and the reason of having the creativity atmosphere in the company  Mr. Countries such as Cuba and North Korea operate under the autocratic leadership style. The autocratic leadership style allows managers to make decisions alone without the input of others. but the responsibility of making the final decision rests with the participative leader. Warm in interpersonal relationships. Leadership Style 1. and seek harmony in decision-making. ……. encourage participation and support the work efforts of others. 2. Share decisions with the work group. company has been appointed Mr. participative leadership values the input of team members and peers. as CEO from within the company or outside  He is Very experienced in the industry – long history. This leadership style benefits employees who require close supervision. background and style? And if the firm has international operations do they have international experience?  Are they responsible for the performance of the firm and how well they interact with the lower level and the BOD?  What is there level of involvement in the strategic management process? Example:  As outlined in the case. It causes them to feel as if their opinions Page 33 Exam Handling Template .  Responsible for the current situation to on improvements. Managers possess total authority and impose their will on employees. (Style = Active participation). Laissez-faire (Delegative) Shows low concern for both people and task. Make most of the decisions. Participative leadership boosts employee morale because employees make contributions to the decision-making process. avoid conflict. skills.

Account Expenditure Scenarios: A. Current Ratio = 2 (1. Current Ratio = 1: Bad situation (Risky Situation to fulfill short term liabilities) B.5 1. 5 1. Current Ratio = 3. 4.5 to 1. Creditor: Very good situation as the company will be able to fulfill its liabilities Current assets calculations: Calculate for each year 2006 2007 2008 Trend Comment 0. This style meets challenges when companies need to make a decision in a short period Managerial skills  Technical skills is the ability to use a special proficiency or expertise in one’s work (Lower level)  Human skills: is the ability work well in cooperation with others people (all levels)  Conceptual skills: is the ability to think analytically and solve complex problems (Top management) Organizational Functions Finance Ratios A. When a company needs to make changes within the organization.3 1. Inventory Current liabilities: All Liabilities for the same period a.9 Increasing up t0 2 Good situation Page 34 Exam Handling Template . MBA Comprehensive Exam Handling Steps matter. Liquidity 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐴𝑠𝑠𝑒𝑡𝑠 Current Ratio= (Xtimes) 𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝐿𝑖𝑎𝑏𝑖𝑙𝑡𝑖𝑒𝑠 Current ratio: How much current assets covers the current liabilities. Cash b. the participative leadership style helps employees accept changes easily because they play a role in the process. Receivables c.8): Very Strong position C. Investors: Very bad situation due to surplus of cash that is not invested as cash should be invested for the sake of return and dividends 2. Payables b. (capability of the company to fulfill the short-term liabilities) Current assets: All assets that can be liquidated for the next 3 months (converted into cash) a.

95 Decreasing below2 Bad situation due to low performance B.3 0. Page 35 Exam Handling Template .3 In case of decreased trend: As a CEO my recommendation is to apply cost leadership strategy to correct the situation.2 Three 100 1000$ 700$ 300 300/100=0.3 Increasing above 2 Bad situation due to surplus of cash and resources that the management team should have invested in 4 2.2 Two 200 2000$ 1600$ 400 400/2000=0. Decreased trend (high operating expenses): Low performance of the management team It evaluates the performance of the management team due to incurring (spending) operating expenses only The best strategy to apply in this situation is retrenchment to decrease operating expenses.8 2. Profitability Ratio 𝐺𝑟𝑜𝑠𝑠 𝑃𝑟𝑜𝑓𝑖𝑡 1. year 3 cost (7$). Gross Profit Margin= 𝑆𝑎𝑙𝑒𝑠 Sales (Revenue): Marketing and sales department responsibility COGS: Supply chain department responsibility Gross profit margin evaluates the performance pf supply chain team of the company Increased trend: Efficient performance of the supply chain department Decreased Trend: Inefficient performance of the supply chain departement Example: Product (10$) Cost (8$). MBA Comprehensive Exam Handling Steps 2. Operating Income Margin= 𝑆𝑎𝑙𝑒𝑠 Increased trend (low operating expenses): Efficient performance of the management team as they are incurring the operating expenses efficiently. 𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝐼𝑛𝑐𝑜𝑚𝑒 2.2 1.8 3.3 2.1 Decreasing towards 2 Good situation 2. Recession decreased no of units sold Year Units sold Revenue COGS Gross Profit Gross Profit Margin One 100 1000$ 800$ 200 200/1000=0.

MBA Comprehensive Exam Handling Steps 𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒 3. Net Operating Income margin = 𝑆𝑎𝑙𝑒𝑠 It is a combination of efforts of management team and supply chain team Increasing trend: The aim of any business. 𝑅𝑒𝑡𝑢𝑟𝑛 (𝐸𝑎𝑟𝑛𝑖𝑛𝑔)(𝑁𝑒𝑡 𝐼𝑛𝑐𝑜𝑚𝑒) 4. At 31/12 take cash buy new inventory so lead time ends in the next year. Return on Assets= 𝑇𝑜𝑡𝑎𝑙 𝐴𝑠𝑠𝑒𝑡𝑠 (𝑓𝑟𝑜𝑚 𝑏𝑎𝑙𝑎𝑛𝑐𝑒 𝑠ℎ𝑒𝑒𝑡) How much investment in asset to earn one dollar in return. Decrease inventory turnover (offering discounts). To rectify we have to: 1. Increase return or total assets. ROA: how much impact of operations on assets Increasing trend: good performance of the management team Decreasing trend: bad performance of the management team in managing assets. Decreasing trend: Adopt unrelated diversification strategy. Creditors: Good especially in case of recession Page 36 Exam Handling Template . Leverage 𝑇𝑜𝑡𝑎𝑙 𝐿𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠 Debt Ratio = (from balance sheet) 𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠 Example: Debt ratio is 30% Then 30% of the company assets is financed by debt Normal debt ratio is 30% to 70% Increasing trend more than 30%: Risky situation as more assests is fainanced by debt Decreasing trend to 30%: Better situation Increasing trend to 30%: Extra loans to expand business Decreasing trend less than 30%: For investors: Bad due to losing opportunities to acquire loans to increase the business especially in case of market growth. The management team of company A is better than that of company B regarding managing all assets (taking decisions regarding assets whether fixed or current/ long term or short term). C. Decreasing current assets will decrease total assets thus will increase ROA. 2. ROA=ROI in calculation Company A B Capital 100 MD 100 MD Return 20% 15% The two companies work in the same industry.

Fixed Assets Turnover Ratio it measures how efficiently the firm uses its plant & equipments. MBA Comprehensive Exam Handling Steps Scenario Comment High ROA/ High Debt Ratio Good Low ROA/ High Debt Ratio Bad financial position High ROA/ Low Debt Ratio Good Low ROA/ Low Debt Ratio Bad We measure the trend by comparing the 1st year to the 3rd year. Total Debt To Total Assets Ratio = total debt (liabilities) ÷ total assets = (%) the creditors have supplied (%) of the firms total financing. Current Ratio = Current assets ÷ Current liabilities = # times. Inventory Turnover Ratio Indicates how many times the inventory turned over during the accounting period. Quick Ratio(Acid test ratio) = Cash + Marketable securities +Receivables ÷ Current liabilities OR = Current Assets – Inventories ÷ Current Liabilities = (# times It’s a measure of immediate paying ability.  Profitability Ratios: The effect of liquidity. = Sales ÷ net fixed assets = (#time) each 1$ of fixed assets results in (…$) of sales 3.  Financial leverage or Debt Management Ratios: Determine the level of debt in the firm’s capital structure & measure how much debt the firm can take to finance its activities.e: firm’s liquidity position. Total Assets Turnover Ratio = Sales ÷ Total Assets = (#time).  Liquidity Ratios: They measure the short term debt paying ability. It should be > 1 to be a good sign. 1. each 1$ of current liabilities is covered by # $ of current assets. = Sales ÷ Average inventory = (#times) 2.  Assets Management Ratios: 1. i. asset management & debt management on operating results Page 37 Exam Handling Template . 2. 1.

If it’s lower than industry average it indicates. 2. Profit Margin on Sales Ratio = Net Income ÷ Net Sales (cash & credit) = (%). more realistic it’s better to use operating income instead of net income..Time). this is overvalued stock If t’s < 12-15 time EPS. inefficient operations & Heavy use of debt. Costs are too high. If the market price per share is > 12-15 time EPS. this is undervalued stock. Page 38 Exam Handling Template . 1. MBA Comprehensive Exam Handling Steps 1. Price/earnings ratio = market price per share ÷ earnings per share (EPS) = (. Each 1$ of net sales results on average in () cents of net income. 3. Return on Common Stockholder’s Equity (ROE) = net income ÷ average common stockholder’s equity = #%  Market Value Ratios: (the outsider’s view): Give management an indication of what investors think of the company’s past performance and future prospects. Return On Total Assets (ROA) ratio = net income /average total assets = (%) Each 1$ of total assets results in (…) cents of net income.

MBA Comprehensive Exam Handling Steps

Page 39 Exam Handling Template

MBA Comprehensive Exam Handling Steps

Page 40 Exam Handling Template

MBA Comprehensive Exam Handling Steps

Finance Strategies (references)

To provide the organization with funds and a capital structure to suit the strategic requirements

2. Sources of funds(capital mix decisions)
Internal vs external and

2. Usage of funds linking allocation to strategies prioritizing projects and activities Capital
expenditure vs. working capital

3. Management of funds Dividend mgt., accounts and audit, capital structure management,

Finance Strategies & Grand Strategies

Stability: daily operations, cash mgt., working capital needs, current assets

Expansion: capital budgeting, fixed assets, long term investments, decentralized expenditure

Retrenchment: rescue operations, centralized expenditure, reallocation of funds, pruning and cuts


1. Customer,
2. Effective segmentation
3. Competitive Standpoint,
4. Unique Selling Propositions,
5. Product Quality,
6. Relative Market Share
7. Loyalty
8. Distribution Costs
9. Pricing
11. Geographical Coverage
12.Market research
13.After Sales Services
14.Customer knowledge
15.New product skills
16.Sales force

Page 41 Exam Handling Template

etc. Capacity. MBA Comprehensive Exam Handling Steps R&D  Are R&D facilities available and adequate?  Cost effectiveness of outsourced R&D  R&D personnel well qualified  Effective allocation of R&D resources  Adequate management information and computer systems  Effective communication between R&D and other units  Are present products technologically competitive Operations/ Production  Are supplier’s raw materials reliable and reasonable  Are facilities machinery and offices in good condition  Are inventory control policies and procedures effective  Effectiveness of quality control policy and procedures  Are facilities resources and markets strategically located  Does the firm have technological competencies?  Process. Page 42 Exam Handling Template . society. Workforce and quality are the functions Information Systems  Is it used by all managers to make decisions?  Is CIO or director if IS position n the firm  Data on IS updated regularly  All functional areas contribute input to IS  Effective passwords for entry to IS  Familiarity of strategists with rival firms IS  Is user friendly  Do all users of IS understand the competitive advantages that information can provide firms  Computer training workshops for IS users  Continually improvements of IS content and user friendliness Human Resource The human resource objective reflects the intention of the senior management (strategy) with a balance to the related topics such as HR functions. Objectives: There are four major objectives for the Human resource management. A. governing rules. Inventory.

Career Path and development: the preparation of the career path for the employees will help the stability and minimize the turnover of the employees. k. Functional Objectives: maintain the department’s contribution at a level appropriate to the org. h. Training and development: on-the. d. retain productive workforce. f. Human Resource Policies and Programs a. Enhance employee organizational commitment: by increasing job involvement. Preparation and selection: Review of the employees' job description. l. objectives. Incentive system will ensure the motivation of the employees to better performance (linking incentive to production) g.this will increase employee's involvement and enhance their working life balance. Enhance employee participation: in implementing our strategy. e.( if the company is multinational) Page 43 Exam Handling Template . Societal Objective : respond ethically and socially to the challenges of the environment while minimizing the negative impact of such demands on the organizations d. all employees from different organizational levels must make a meaningful contribution in decision-making . which results in lower levels of absenteeism and turnover. Recruitment: designing a good recruitment process (Selection. c. Implementing employee recognition programs: starting with personal attention and ending with appreciation for a job well done. MBA Comprehensive Exam Handling Steps a. interviews) with a high level of orientation to ensure the compatibility of the new recruited employees with the existing culture to achieve organizational objectives. Compensation Policies and protection: What employees get in exchange for their contribution to the organization  maintains. Personal objectives: to assist retain and motivate the employees for achieving their personal goals and guide them to better achievement (most important ) B. Managing workforce diversity ( if the organization is going internationally) i. needs c. achieve the org. job specification and job performance standard to match the change of the organization. b. Off-the-Job training and Provide career planning assistance for employees. Organizational objectives: to achieve the required organization effectiveness and objectives and ensure that the organization always has people with the right abilities available to do the right work b. Succession Planning: the preparation of the company succession plan will enable the organization to stand any future challenges. j. Develop effective staffing plans supporting the organizational strategies by allowing to fill job openings proactively (in terms of number and the quality of the workforce for the short and long term) VIP in case of international operations.job” training.

ratios. Regardless of whether a key factor is an internal strength or weakness. 6. The sum of all weights must equal 1.10 4 0. The weight assigned to a given factor indicates the relative importance of the factor to being successful in the firm’s industry. using percentages. the factor should be included twice in the IFE Matrix.0. far more strengths than weaknesses could be identified. Key Internal Factors Weight Rating Weighted (assumption) (assumption) Score Strengths 1. List strengths first and then weaknesses. Assign a 1-to-4 rating to each factor to indicate whether that factor represents a major weakness (rating = 1) minor weakness (rating = 2) minor strength (rating = 3) major strength (rating = 4). factors considered to have the greatest effect on organizational performance should be assigned the highest weights. including both strengths and weaknesses. 4. The company has an extensive and wide variety of electrical products and services 0.09 4 0. Elsewedy is a highly reputed firm in the MENA with four diversified segments 0. 2. List key internal factors as identified in the internal-audit process. 1. Use a total of from 10 to 20 internal factors. 9. This strategy-formulation tool summarizes and evaluates the major strengths and weaknesses in the functional areas of a business. and a weight and rating should be assigned to each statement 5. The example hereafter include Itemized below are the strengths and weaknesses of Elsewedy – from the information provided. Be as specific as possible. Assign a weight that ranges from 0.0 (all-important) to each factor. Sum the weighted scores for each variable to determine the total weighted score for the organization. MBA Comprehensive Exam Handling Steps Internal Factor Evaluation (IFE) Matrix A summary step in conducting an internal strategic-management analysis is to construct an Internal Factor Evaluation (IFE) Matrix. 3.36 Page 44 Exam Handling Template . Note that strengths must receive a 3 or 4 rating and weaknesses must receive a 1 or 2 rating. 7. and comparative numbers. When a key internal factor is both a strength and a weakness. whereas the weights in step 2 are industry-based. Ratings are thus company-based.40 2. and it also provides a basis for identifying and evaluating relationships among them. 8.0 (not important) to 1. Multiply each factor’s weight by its rating to determine a weighted score for each variable.

18 10. You can develop BCG Matrix or Grand Matrix if the data of the model is available Page 45 Exam Handling Template .00 3. “Elsewedy targets almost everyone” – this suggests a lack of focus 0.05 2 0.06 2 0. BCG and Grand Matrix Start with IE Matrix Then SPACE If you have time or it was mentioned do TOWS if not. and professional end-users 0.09 3 0.07 2 0.14 3.09 4 0.06 3 0.21 Total 1. Matching Phase The Matching phase – AFTER doing internal and external analysis. we will List all suitable plans through using one or more of the matching tools Matching tools are: TOWS.27 2.10 Weaknesses 1. allowing speedy decision-making 0. the Slovakian energy solutions company 0. The wire and cables sales in Egypt are predicted to decline when New Cairo is completed 0. The company targets all three sectors: public.18 7. Turnkey projects with potential contribution from the other segments are executed mostly in Egypt and Africa only 0. The Elsewedy family owns 75 percent of the company.21 6. IE Matix. Elsewedy has strong business links with some competitors as its favoured customers 0.20 Summation No Total must =1 Summation weighted score (TWS) = Σ Weight x Rate 5.10 4 0.06 3 0. Elsewedy has the largest production in Egypt with over 50 percent of the market share 0. SPACE Matrix.07 3 0. In 2007 Elsewedy acquired Iskraemeco.36 9. MBA Comprehensive Exam Handling Steps 3.K. Elsewedy is currently well-established internationally in MENA and Western Europe 0. It is a price leader producing quality electrical goods and services competitively 0. don’t do it.40 4.12 5.27 8. and France in the EU 0.09 3 0. private.07 3 0. The company has successfully entered the U.

I will not deal with the cells in the matrix as nine cells but I will deal with them as three bundles. Cell#7: means that a certain business unit that is located in this cell is strong internally and weak externally. Cell#6 and cell#8 and cell#9 are the third bundle: Page 46 Exam Handling Template . 2. The strategy of this bundle is to sustain that positive and strong position. This first bundle that covers cells#1. 4 is called: "Grow and Build". and sustain means to go for the integration strategies and the intensive strategies. it means that a certain business unit that is located in this cell is strong internally and strong externally. which is average position. Cell#2: means that a certain business unit that is located in this cell is average internally and strong externally. I need to stabilize myself in this bundle and avoid going down to the third bundle and this stabilization is through the intensive strategies. i. MBA Comprehensive Exam Handling Steps Internal External Matrix IE (internal external) matrix based on the total internal weighted scores and the total external weighted scores from IFE and EFE analysis. Cell#3 and cell#5 and cell#7 are the second bundle: is called: Hold and Upgrade "hold& maintain" Cell#3 in terms of external and internal position: means that a certain business unit that is located in this cell is weak internally and strong externally. Cell#5: means that a certain business unit that is located in this cell is average internally and average externally. which is a strong and a positive position. which is a strong and positive position. because the weakest position in this bundle is average and the opposite position is strong. Cell#4: means that a certain business unit that is located in this cell is strong internally and average externally. it is an average position. as follows: Cell#1 and cell#2 and cell#4 are the first bundle: "after finishing analysis according to the TWS of IFE and EFE" we may interpret Cell#1 in terms of external and internal position. because the weakest position in this bundle is average and not weak.e. then I have to sustain this average position and try to upgrade the situation.

MBA Comprehensive Exam Handling Steps Cell#6 regarding external/internal position: Business located in this cell is weak internally and average externally. which is average position. the total weighted score can range from a low of 1. This third bundle that covers cells#6. The SPACE matrix is a management tool used to analyze a company. SPACE Matrix The Strategic Position & Action Evaluation matrix or short a SPACE matrix is a strategic management tool that focuses on strategy formulation especially as related to the competitive position of an organization. If I have a sort of competitive edge in the business unit located in this bundle I will invest in it.0. whereas scores significantly above 2. if I don’t have any.5 indicate a strong internal position. with the average score being 2. or assessing strategic alternatives (IE matrix).5 characterize organizations that are weak internally. Cell#8: means that a certain business located in this cell is average internally and weak externally. Competitive edge. an IFE Matrix should include from 10 to 20 key factors. I will just go for the divestiture strategy. The SPACE matrix can be used as a basis for other analyses. Like the EFE Matrix. The situation in this bundle is from weak to average. that's what we call to harvest in this business unit. Cell#9: means that a certain business located in this cell is weak internally and weak externally. 8. relying basically on the defensive strategy.e. i. Page 47 Exam Handling Template . Comment Regardless of how many factors are included in an IFE Matrix.0 to a high of 4. industry analysis. 9 is called: "Harvest or Divest". such as the SWOT analysis. It is used to determine what type of a strategy a company should undertake. BCG matrix model. The number of factors has no effect upon the range of total weighted scores because the weights always sum to 1. Total weighted scores well below 2.5.0. in order to be able to push this business unit/product line from this third bundle to the second bundle.

Internal strategic dimensions: I. MBA Comprehensive Exam Handling Steps The SPACE matrix is broken down to four quadrants where each quadrant suggests a different type or a nature of a strategy:  Aggressive  Conservative  Defensive  Competitive The SPACE Matrix analysis functions upon two internal and two external strategic dimensions in order to determine the organization's strategic posture in the industry. The SPACE matrix is based on four areas of analysis. Financial strength (FS) +VE / Y-axis  Return on investment  Leverage Page 48 Exam Handling Template .

capacity utilization The SPACE matrix calculates the importance of each of these dimensions and places them on a Cartesian graph with X and Y coordinates. Page 49 Exam Handling Template . Industry strength (IS) +VE/ X-axis  Growth potential (GDP Growth)  Profit potential  Financial stability  Technological know-how  Resource utilization  Ease of entry into market  Productivity. Environmental stability (ES) -VE/ Y-axis  Technological changes  Rate of inflation  Demand variability  Price range of competing products  Barriers to entry  Competitive pressure  Price elasticity of demand Ease of exit from market Risk involved in business II. MBA Comprehensive Exam Handling Steps  Liquidity  Working capital  Cash flow  Inventory turnover  Earnings per share  Price earnings ratio  Ability to raise capital II. Competitive advantage (CA) -VE/ X-axis  Market share  Product quality  Product life cycle  Customer loyalty  Competition’s capacity utilization  Technological know-how  Control over suppliers & distributors  Speed of innovation  Market niche position External strategic dimensions I.

Rate competitive advantage (CA) and environmental stability (ES) using rating scale from -6 (worst) to -1 (best).ES values can be between -1 and -6. Step 5: Add the average score for the competitive advantage (CA) and industry strength (IS) dimensions. industry strength (IS). The SPACE matrix can be created using the following seven steps: Step 1: Choose a set of variables to be used to gauge the competitive advantage (CA).CA values can range from -1 to -6. and financial strength (FS). Example: Page 50 Exam Handling Template . environmental stability (ES).FS values range from +1 to +6. MBA Comprehensive Exam Handling Steps The following are a few model technical assumptions: . Step 6: Add the average score for the SPACE matrix environmental stability (ES) and financial strength (FS) dimensions to find your final point on the axis Y. Step 7: Find intersection of your X and Y points. This line reveals the type of strategy the company should pursue. Step 3: Find the average scores for competitive advantage (CA). the CA and IS values in the SPACE matrix are plotted on the X axis. Step 2: Rate individual factors using rating system specific to each dimension. .The FS and ES dimensions of the model are plotted on the Y axis. Draw a line from the center of the SPACE matrix to your point. Rate industry strength (IS) and financial strength (FS) using rating scale from +1 (worst) to +6 (best). and financial strength (FS). Step 4: Plot values from step 3 for each dimension on the SPACE matrix on the appropriate axis. .IS values can take +1 to +6. . industry strength (IS). . . environmental stability (ES). The SPACE matrix is constructed by plotting calculated values for the competitive advantage (CA) and industry strength (IS) dimensions on the X axis. The Y axis is based on the environmental stability (ES) and financial strength (FS) dimensions.By definition. This will be your final point on axis X on the SPACE matrix.

market development. Page 51 Exam Handling Template . Competitive strategies include backward. Competitive: Indicating competitive strategies. and related diversification. market penetration. Conservative strategies most often include market penetration. product development. forward. It needs to use its internal strengths to develop a market penetration and market development strategy. This can include product development. integration with other companies. Conservative: Implies staying close to the firm’s basic competencies and not taking excessive risks. acquisition of competitors. and related diversification. liquidation. and so on. Defensive strategies include retrenchment. divestiture. and horizontal integration. MBA Comprehensive Exam Handling Steps This particular SPACE matrix tells us that our company should pursue an aggressive strategy. market development and product development. Comment Aggressive: Our company has a strong competitive position it the market with rapid growth. Defensive: Suggests that the firm should focus on rectifying internal weaknesses and avoiding external threats.

Capitalize on your opportunities. which while making use of the same inputs (Threats. it creates core competencies in meeting the needs of its customers. • A company may identify opportunities ill the external environment but have organizational weaknesses which prevent the firm from taking • advantage of an opportunity. such a firm may have to fight for its survival or may even have to choose liquidation. reorganizes them and integrates them more fully into the strategic planning process. Opportunities. the aim of the WT strategy is to minimize both weaknesses and threats. • An alternative tactic would be to hire and train people with the required technical capabilities. Sell off low revenue generating segments / products to raise cash and pay off debt 2. In addition. Focus on your strengths. • For example. the firm also has the choice of doing nothing. • An organization faced with external threats and internal weaknesses may indeed be in a precarious position. MBA Comprehensive Exam Handling Steps TOWS Matching Model TOWS Matrix. the WT position is one that any firm will try to avoid. • Whatever strategy is selected. helps you think about the options that you could pursue. To do this you match external opportunities and threats with your internal strengths and weaknesses. such a firm may prefer a merger. For example. Examples: 1. Weaknesses and Strengths). as illustrated in the matrix below: When an organization matches internal strengths to external opportunities. • Of course. WT Strategy (Min-Min) • In general. with the intent of either overcoming the weaknesses or hoping that the threat will diminish over time (too often wishful thinking). The TOWS matrix. • In fact. an organization should act to convert internal weaknesses into strengths and external threats into opportunities. Sell off low profit segments and pay down the long-term debt Page 52 Exam Handling Template . Shore up your weaknesses. lack of Skills/technology in certain areas. or may cut back its operations. Recognize your threats. The WO Strategy (Mini-Max) • The second strategy attempts to minimize the weaknesses and to maximize tile opportunities. • One possible strategy would be to acquire this Skills/technology through cooperation with a firm having competency in this field. • But there are other choices. thus leaving the opportunity to competitors.

Promote “healthy” snacks and drinks 15. MBA Comprehensive Exam Handling Steps 3. Develop a new moderately priced product line 4. Acquire innovative technology/Internet. Negotiate with employees and union representative for pay cut to eliminate laying off staff and improve cash flow. Offer a better discount for retailers to sell / promote Harley merchandise such as clothes. This would attract more businesses to the area and will be a revenue enhancing venture for the city / county Page 53 Exam Handling Template . Increase quality control to improve reducing product recalls 14. The aim is to maximize the former while minimizing the latter. Increase franchising and licensing to improve cash flow and income 5. mugs. Increase marketing efforts through social networks and the Internet on consumer YYY(products) specific to young generation 11. Sell off business units to improve cash infusion to the company Form joint ventures with companies who are not in direct competition with drug companies but are within health-related businesses for developing/introducing non-competing products 4. Try buying new equipment and rides by long term financing or by establishing loyalty agreement for reserving more cash for working capital 9. Struck a deal with the county or local government for getting additional funding for renovation of historic building and re-building the local area. mostly for young generation 8. Develop new products for small kids based on cartoon characters 7. Expand distribution by selling to stores other than their own retailers 5. Use the savings and offer better discounts to customers 2. does not mean that a strong organization can meet threats in the external environment head-on Examples: 1.related businesses using a combination of cash and debt 10. Improve operations by being more lean and cutting back excessive executive spending 13. however. Improve the quality by educating the workers on how to test and sample products before they are shipped 16. • This. Offer better financing rate to new / first time buyers The ST Strategy (Maxi-Mini) • This strategy is based on the strengths of the organization that can deal with threats in the environment. Develop new health related products such as vitamins and dietary pills / drinks for health- conscious consumers 12. Sponsor more athletics programs. Improve security implemented on products to reduce / limit intellectual property and licensing violations 6. 17. Improve security measure in theme parks and hospitality locations by using surveillance cameras 3. etc.

) for opening stores close by and share some of the mass advertising cost 7. strengths and opportunities.S. etc. • If they have weaknesses. • Such an enterprise can lead from strengths. will attempt to get into a situation where they can work from strengths to take advantage of opportunities. Increase advertising and promotion to young generation (coupons and rebate cards) through social networks such as Twitter and Facebook 3.S. Create additional bundling partnership for sound or video streaming 9. and other networking channels 12. even if they temporarily use one of the three previously mentioned strategies. Aggressively promote the XXX(company) by offering deep discounts to local and surrounding counties / cities 5. car rental. Twitter. etc. MBA Comprehensive Exam Handling Steps 6. Improve promotion on selected lower priced models with zero or very low rate financing to younger generation through Internet using Facebook. Form partnership with other related businesses (restaurant or hotel chain. Congress in developing a medical program. media ads. Offer “Free” extended warranty for additional 2 years to gain customer loyalty and brand image 13. Improve distribution in European market with new and innovative organic products 17. corporate / school event discounts. and abroad The SO Strategy (Maxi-Maxi) • Any company would like to be in a position where it can maximize both. Examples: 1. Twitter.Expand XXX(company) segment to popular countries where they have strong economy and have positive image for US products and services 2. Form a partnership/ joint venture (minority interest) with generic drug manufacturers on promoting and educating the health benefits of specific products 10. they will cope with them so that they can focus on opportunities. Page 54 Exam Handling Template . student or state or employee discounts. they will strive to overcome them. Expand into international market more where the economy is stronger 4. making them strengths. advertising. discounting product pricing 15. etc. Use the excess cash by acquiring biotechnology or other health related businesses 14. Sponsor programs to teens and younger generation to through virtual Facebook. and such 16.) both in the U. Offer new marketing data collection for advertisers 8. If they face threats. Penetrate the market (non-locals) by offering discount / membership cards if purchased in advance (% off after so many visits). Increase current promotional campaign (product placement. Work with the government and the U. utilizing resources to take advantage • Successful enterprises. Outsource some of R&D procedures and processes in order to reduce R&D cost but ensure the intellectual property remains secure and confidential 11. Online newsgroup / press releases.

Increase advertising spending by additional 10 percent on fee based segments 8. MBA Comprehensive Exam Handling Steps 6. WT) and justify the choice and make sure these strategies match vision and mission of company. Implement a vertical or horizontal integration (forward or backward) of a company that has global presence 7. Develop a lower price / light weight bike. (safest strategy to use is intensive strategy) Page 55 Exam Handling Template . Continue international expansion 16. Increase R&D on products related to YYY(products) 10. Acquire additional companies that are innovative and have pending patents on popular health related products 12. Expand into S.Develop a new product line. Acquire a small competitor that sells to restaurants and / or intermediary channels 18. Invest additional funding in R&D. improving new product introduction 11. efficient in fuel consumption for individuals who are interested in riding a bike but can’t afford or ride the current models 19. Cutback prices on advertising and fee-based segment by 2 percent 9. focusing on organic ingredients 17. American and European countries by offering better incentives and financing 13. Create a new line for female riders to be promoted in US and foreign markets Common results of TOWS • New Business opportunities • Businesses to abandon • Allocation of resources • Expansion or diversification • International markets • Mergers or joint ventures • Avoidance of hostile takeover At the end choose 2-3 actions from the options (SO. Continue purchasing new companies in segments that the company is losing product sales or market share 15. Produce more fuel efficient and smaller models and promote them with lower financing options (in case of cars) 14.

BMW. Reduce costs through automation 2. W1 4. Volvo. BMW in Japan models to 8. Cash position 1. Demand for luxury cars 1. Use financial resources to 2. Reorganizations 4. Long cycle for new model development 6. Daimler-Benz management holding companies EXTERNAL THREATS S-T STRATEGY W-T STRATEGY 5. Political instability in S. Eastern Europe. Venturing into unrelated 3. MBA Comprehensive Exam Handling Steps Example of how Daimler-Benz used the TOWS matrix in Mercedes cars division: INTERNAL STRENGTHS INTERNAL WEAKNESSES 1. Jaguar. Decrease in defense 1. Manufacture parts in Eastern 1992 acquire other companies or Europe O2. Reliance on past successes and ACTIONS technology bureaucracy 5. Relatively weak position in Japan EXTERNAL OPPORTUNITIES S-0 STRATEGY W-0 STRATEGY 1. Retrench in South Africa needs because of easing defense sector 2. Infinity in Europe 2. sector penetrate the Japanese Lexus. Transform 1. Develop new market 7. Africa Page 56 Exam Handling Template . Prosperity through EC 2. New car models businesses STRATEGIES 4. especially East Germany premium prices O4 3. Location dose to suppliers 3. High costs 2. Diesel emissions compete 9. Electronics technology increased production capacity 3. Luxury car image 2. Renault/Volvo especially in cooperation Europe 10. Form strategic alliance of East—West tensions to consumer with Mitsubishi to 6. Engineering and 4. high-tech) and charge and flexible manufacturing W1. Organizational diversity TACTICS 5. Develop new models (using 1.

and IE Matrix. Concentration on current markets reveals the adoption of strategies such as market penetration and market development and likewise concentration on current products calls for adoption of product development strategy. Any industry whose annual growth in sales exceeds 5 percent could be considered to have rapid growth. Firms located in this quadrant are in excellent strategic position and they need to concentrate on current markets and products. this matrix helps in adopting the best strategy based on the current growth and competitive state of the firm. These firms or divisions should continue to ponder upon current Page 57 Exam Handling Template . The Grand Strategy Matrix makes it an easygoing job. A large scale firm segregated into many divisions can also plot its divisions in this four quadrant Grand Strategy Matrix for formulating the best strategy for each division. It helps in scientific analysis of firms ‘current position and selection of best strategy in accordance with the revealed competitive position and market place. MBA Comprehensive Exam Handling Steps Grand Strategy Matrix. Moreover. Appropriate strategies for an organization to consider are listed in sequential order of attractiveness in each quadrant of the matrix. In each quadrant of the matrix the apt strategies are enlisted in sequential order for each organization or division keeping in view the attractiveness in each quadrant of the matrix. The Grand Strategy Matrix is based on two evaluative dimensions: competitive position and market (industry) growth. This matrix is basically based on four important elements: • Rapid Market Growth • Slow Market Growth • Strong Competitive Position • Weak Competitive Position These elements form a four quadrant matrix in which all organizations can be positioned in such a way that identification and selection of appropriate strategy becomes an easy task. A firm’s divisions likewise could be positioned. BCG Matrix. the Grand Strategy Matrix has become a popular tool for formulating alternative strategies. The key area of management is to suitably select the strategy cohesive with the firms’ market and competitive position. Quadrant I The quadrant one of the Grand Strategy Matrix is meant for those firms which are in a strong competitive position and flourishing with rapid market growth. All organizations can be positioned in one of the Grand Strategy Matrix’s four strategy quadrants. Broadly speaking four elements of the Grand Strategy Matrix can be described as two evaluative dimensions namely market growth and competitive position. SPACE Matrix. In addition to the SWOT Matrix. Grand Strategy Matrix has emerged into a powerful tool in devising alternative strategies.

Such an arrangement may avail the desired funding to buy back the shares or to invest in the current venture in other divisions to strengthen the competitive position. In case the quadrant II firm does not find any suitable strategy to adopt than divestiture of some divisions can be considered as another option. But and a careful thought process needs to be done before assuming such integrations so that any meditation from the current competitive advantage can be avoided. Since quadrant two firms are in a rapid market growth industry. These firms are prone to further decline which may result possibly in liquidation. Moreover. The dilemma in espousing the intensive strategy arises when the firms is lacking distinctive competence or competitive advantage. The management has to change its philosophy and should necessarily adopt new approaches of governing the firm. can be classified as the first option to adopt. An in-depth analysis is necessary to identify the gray areas of incompetence and the reasons behind such ineffectiveness. In case quadrant one firms have excessive resources. The present market position of these firms must click in the minds of the management and they need to weigh up the firms’ present market place critically. it would be wise to adopt the expansion program and indulge in backward. The management should be willing to incur some extensive costs in the overall revamp of the organization. Strategically retrenchment (assets reduction) would be the best option to be considered first. therefore. Quadrant II Firms and divisions falling in quadrant two of the Grand Strategy Matrix are characterized with a weak competitive position in fast growing market. liquidation should be considered so that another business can be acquired. adoption of counteractive measures is also indispensable so that ability to compete effectively is strengthen and firm can find its space in the more competitive environment. The best strategy to espouse in this case is related diversification because it can be helpful in reducing the risk associated with the slender product line. more appropriately. Moreover. The quadrant one firm also requires identifying the risk associated mainly if it is committed to a single product line. Quadrant III The quadrant three firms are operating in a slow growth industry with a weak competitive position. One of the main advantages to the quadrant one firms is that they can afford to exploit the external opportunities and magnify the wealth in numerous areas of dealings. The final option is again divesture or liquidation. as last resort. To avoid such situations quadrant three firms needs introduce drastic changes in almost all the areas of managing the company. These firms have to quest for the promising growth Page 58 Exam Handling Template . an intensive strategy. Quadrant IV The firms falling in quadrant IV are characterized as having a strong competitive position but are operating in a slow growth industry. forward. or horizontal integration. than. MBA Comprehensive Exam Handling Steps competitive advantage and must avoid from loosing the focus from the competitive advantage gained over the time. In this scenario the most enviable substitute is horizontal integration. Secondly diversifying the overall business through shifting the resources should be evaluated as another choice (related or unrelated diversification). The opportunity lagging here is that such firms are operating in a growing industry but the problem area is that they are competing ineffectively.

businesses or products are classified as low or high performers depending upon their market growth rate and relative market share. MBA Comprehensive Exam Handling Steps areas and to exploit the opportunities in the growing markets as they possess the strengths to instigate diversified programs in growing industries. Therefore. Page 59 Exam Handling Template . these firms can often hunt for related or unrelated diversification fruitfully. Ideally quadrant four firms have limited requirements of funds for internal growth whereas they enjoy the high cash flows due to the competitive position they are characterized for. BCG Matrix (Portfolio Analysis) According to this technique. It is used to assess:  Profile of products  The cash demands of products  The development cycles of products  Resource allocation and divestment decisions To understand Boston Matrix you need to understand how market share and market growth interrelate  Market Share Market share is the percentage of the total market that is being serviced by your company. Due to availability of excessive funds quadrant IV firms can also pursue joint ventures. measured by revenue terms or unit volume terms.

Question marks High growth and low market share Most businesses start of as a question mark They will absorb great cash if the market share remains unchanged (low) They have potential to become a star and eventually cash cow but can also become a dog Page 60 Exam Handling Template . not growing or declining 3. and there is plenty of opportunities for everyone to make money The BCG growth share matrix is a portfolio planning model which is based on the observation that a company’s business units are classified into four categories: 1. MBA Comprehensive Exam Handling Steps RMS = Business unit sales this year Leading Rival sales this year sales this year The higher your market share. Stars  High growth and high market share  Stars are leaders in business  They also require heavy investment to maintain its large market share  It leads to a large amount of cash consumption and cash generation  Attempts should be made to hold the market share otherwise the star will become a Cash Cow 2. the higher the proportion of the market you control  Market Growth rate Market growth is a measure of the market’s attractiveness Market growth rate= Individual sales this year – Individual sales last year Individual sales last year Markets experiencing high growth are ones where the total market share available expanding. Cash cows Low growth and high market share They are the foundation of the company and often the stars of yesterday They generate more cash than required They extract the profits by investing as little cash as possible They are located in industries that are mature.

market growth rate and relative market share  Problems of getting data on market growth and relative market share  High market share does not mean profits all time  Business with low market share can be profitable too Page 61 Exam Handling Template . MBA Comprehensive Exam Handling Steps Investments should be high for question marks 4.Growth rate of SBU’s industry  Classifying the SBUs according to the BCG matrix  Developing strategic objective for each SBU’s industry it is based on the combination of market growth and market share relative to the next best competitor Benefits  BCG matrix is simple and easy to understand  It helps you to quickly and simply screen the opportunities open to you. Dogs low growth. and helps you think about how to make the most of them  It is used to identify how corporate cash resources can best be used to maximize the company’s future growth and profitability Limitations  BCG matrix used only two dimensions’.SBU’s relative market share 2. low market share they are the cash traps they do not have the potential to bring in cash Number of dogs in the company should be minimized Business is situated at declining stage Main steps of BCG matrix  Identifying and defining a company into SBUs (Strategic business unit)  Assessing and comparing the prospects of each SBU according to two criteria: 1.

Quantitative Strategic Planning Matrix (QSPM) Quantitative Strategic Planning Matrix (QSPM) is a high-level strategic management approach for evaluating possible strategies. MBA Comprehensive Exam Handling Steps The BCG matrix has its limitations and it is one of the most famous and simple portfolio planning matrix used by large companies having multiple products Relative market share position is given on the x-axis of the BCG Matrix. for example. Quantitative Strategic Planning Matrix or a QSPM provides an analytical method for comparing feasible alternative actions. What is a Quantitative Strategic Planning Matrix or a QSPM? The Quantitative Strategic Planning Matrix or a QSPM approach attempts to objectively select the best strategy using input from other management techniques and some easy computations.. When company executives think about what to do. This process is very much intuitive and subjective. The QSPM method falls within so- called stage 3 of the strategy formulation analytical framework. The growth rate percentages on the y-axis could range from -20 to +20 percent. In other words. measured in percentage terms. the EFE matrix and IFE matrix. The y-axis represents the industry growth rate in sales. The first step in the overall strategic management analysis is used to identify key strategic factors. with 0.0 being the midpoint.. Stage 1 strategic management tools. corresponding to a division that has half the market share of the leading firm in the industry. and which way to go.50. they move it up on the list. If they like one strategy over another one. The midpoint on the x-axis usually is set at . Stage 2 strategic management tools. matches them with results from stage 2 analyses.. The QSPM method introduces some numbers into this approach making it a little more "expert" technique. and then decides objectively among alternative strategies.. This can be done using. Page 62 Exam Handling Template . the QSPM method uses inputs from stage 1 analyses. they usually have a prioritized list of strategies.

This can be done using the stage 2 strategic management tools. see the picture below. They are now asking which option is the better one. The acquisition strategy has a score of 4. MBA Comprehensive Exam Handling Steps After we identify and analyze key strategic factors as inputs for QSPM. What does a QSPM look like and what does it tell me? First. The acquisition strategy yields higher score than the internal expansion strategy. The other strategy is to expand internally. IE). company executives determined that this company XYZ needs to pursue an aggressive strategy aimed at development of new products and further penetration of the market. let us take a look at a sample Quantitative Strategic Planning Matrix QSPM. 0 = not relevant) Doing some easy calculations in the Quantitative Strategic Planning Matrix QSPM.. QSPM Quantitative Strategic Planning Matrix example (Attractiveness Score: 1 = not acceptable. Based on strategies in the stage 1 (IFE. 2 = possibly acceptable. EFE) and stage 2 (BCG.04 in the QSPM shown above whereas the internal expansion strategy has a smaller score of 2. One strategy is acquiring a competing company. we came to a conclusion that acquiring a competing company is a better option. Conceptually. 4 = most acceptable.. Page 63 Exam Handling Template . Stage 3 strategic management tools. the QSPM in stage 3 determines the relative attractiveness of various strategies based on the extent to which key external and internal critical success factors are capitalized upon or improved. The relative attractiveness of each strategy is computed by determining the cumulative impact of each external and internal critical success factor. or the IE matrix model. They also identified that this strategy can be executed in two ways. BCG matrix model. for example the SWOT analysis (or TOWS). SPACE matrix analysis. This QSPM compares two alternatives. This is given by the Sum Total Attractiveness Score figure. 3 = probably acceptable. SPACE. we can formulate the type of the strategy we would like to pursue.70.

one at a time. and asking the following question: Does this factor make a difference in our decision about which strategy to pursue? If the answer to this question is yes.. If the answer to the above question is no. If the key factor does not affect the choice being made at all.. You can find these numbers in our example in the column following the column with factors. Calculate the Total Attractiveness Scores (TAS) in the QSPM. then the strategies should be compared relative to that key factor. Total Attractiveness Scores are defined as the product of multiplying the weights (step 3) by the Attractiveness Scores (step 4) in each row. then the respective key factor has no effect on our decision. Step 1. Step 3. and 4 = highly attractive. You can take these factors from the EFE matrix and the IFE matrix. Page 64 Exam Handling Template . Step 5. Attractiveness Scores are determined by examining each key external and internal factor separately... These will be included in the left column of the QSPM. Step 2.. 3 = reasonably attractive.. Strategies evaluated in the QSPM should be mutually exclusive if possible. Step 4… Attractiveness Scores (AS) in the QSPM indicate how each factor is important or attractive to each alternative strategy. You can take these weights from the IFE and EFE matrices again. 2 = somewhat attractive. identify strategy alternatives that will be further evaluated.. The range for Attractiveness Scores is 1 = not attractive.strengths and weaknesses. Then generate a list of the firm's key external factors -. Having the factors ready. MBA Comprehensive Exam Handling Steps How do I construct a QSPM?. These strategies are displayed at the top of the table. Provide a list of internal factors -.. then the Attractiveness Score would be 0.opportunities and threats. Each key external and internal factor should have some weight in the overall scheme.

Suppliers. MBA Comprehensive Exam Handling Steps The Total Attractiveness Scores indicate the relative attractiveness of each key factor and related individual strategy. The higher the Total Attractiveness Score. the more attractive the strategic alternative or critical factor. The QSPM Sum Total Attractiveness Scores reveal which strategy is most attractive.2. Calculate the Sum Total Attractiveness Score by adding all Total Attractiveness Scores in each strategy column of the QSPM. Vertical Integration Strategies (Gain Control Over: Distributors. and Competitors) 1. Retailers) Guidelines  Current distributors – expensive or unreliable  Availability of quality distributors – limited  Firm competes in industry expected to grow markedly  Firm has both capital & HR to manage new business of distribution  Current distributors have high profit margins 1. Backward Integration (Ownership or Control -. # competitors is large  High growth in industry sector  Firm has both capital & HR to manage new business  Stable prices are important  Current suppliers have high profit margins 1.1. Higher scores point at a more attractive strategy.Firm’s suppliers) Guidelines  Current suppliers – expensive or unreliable  # of suppliers is small.. Horizontal Integration (Ownership or Control --Firm’s competitors) Page 65 Exam Handling Template . Forward Integration(Gain Control Over ---Distributors. Step 6.. considering all the relevant external and internal critical factors that could affect the strategic decision 6.3.Decision/Recommendations Organizational level strategies 1.

low margins & returns  Current distribution channels can be used  New products have counter cyclical sales patterns 3. Concentric Diversification (New & related products/services) Guidelines  Compete in no/slow growth industry  New & related products increases sales of current products  New & related products offered at competitive prices  Current products—decline stage of product life cycle  Strong management team 2. Conglomerate Diversification(New & unrelated products/services) Guidelines  Declining annual sales & profits  Capital & managerial ability to compete in new industry  Financial synergy between acquired and acquiring firms  Current markets for present products – saturated 2. industry sales increasing  Increased economies of scale provide major competitive advantage Page 66 Exam Handling Template . Intensive Strategies: Improve competitive position with existing products 3. MBA Comprehensive Exam Handling Steps Guidelines  Gain monopolistic characteristics w/o federal government challenge  Competes in growing industry  Increased economies of scale – major competitive advantages  Faltering due to lack of managerial expertise or need for particular resource  2. Horizontal Diversification(New & unrelated products/services for current customers) Guidelines  Adding new products/services would significantly increase revenues  Highly competitive and/or no-growth industry.1. Market Penetration (Increased Market Share)  Present products/services & Present markets  Greater marketing efforts Guidelines  Current markets not saturated  Usage rate of present customers can be increased significantly  Shares of competitors declining.1. Diversification Strategies (Less Popular -.2.More difficult to manage diverse business activities) 2.3.

major internal reorganization necessary 4. in parts. pressure for stockholders  Strategic managers have failed  Rapid growth in size. poor employee morale. has distinctive competencies  Firm is one of weaker competitors  Inefficiency.Present products/services to new geographic areas) Guidelines  New channels of distribution – reliable. Retrenchment: (Regrouping .2. inexpensive. Product Development(Increased Sales -.3. Developing new products/services) Guidelines  Products in maturity stage of life cycle  Industry characterized by rapid technological development  Competitors offer better-quality products @ comparable prices  Compete in high-growth industry  Strong R&D capabilities 4.2.3. for their tangible worth Guidelines  Retrenchment & divestiture failed  Only alternative is bankruptcy  Minimize stockholder loss by selling firm’s assets Page 67 Exam Handling Template .Improving present products/services. low profitability.1. Market Development (New Markets -. Defensive Strategies 4. Company’s assets. Liquidation: Selling . Divestiture(Selling a division or part of an organization) Guidelines  Retrenchment failed to attain improvements  Division needs more resources than are available  Division responsible for firm’s overall poor performance  Division is fit with organization  Large amount of cash is needed and cannot be raised through other sources 4. Cost & asset reduction to reverse declining sales & profit) Guidelines  Failed to meet objectives & goals consistency. good quality  Firm is successful at what it does  Untapped/unsaturated markets  Excess production capacity 3. MBA Comprehensive Exam Handling Steps 3.

creditors First Mover Advantages  Benefits a firm may achieve by entering a new market or developing a new product or service prior to rival firms. Why Joint Ventures Fail -  Managers who must collaborate daily. local management can reduce risk  Complementary distinctive competencies  Resources & risks where project is highly profitable (e. customers. Alaska Pipeline)  Two or more smaller firms competing w/larger firm  Need to introduce new technology quickly Mergers & Acquisitions  Provide improved capacity utilization  Better use of existing sales force  Reduce managerial staff  Gain economies of scale  Smooth out seasonal trends in sales  Gain new technology  Access to new suppliers. not involved in developing the venture  Benefits the company not the customers  Not supported equally by both partners  May begin to compete with one of the partners Guidelines  Synergies between private and publicly held  Domestic with foreign firm. distributors. MBA Comprehensive Exam Handling Steps Means for Achieving Strategies Joint Venture/Partnering “Two or more companies form a temporary partnership or consortium for purpose of capitalizing on some opportunity”. products.g. Potential Advantages  Securing access to rare resources  Gaining new knowledge of key factors & issues  Carving out market share  Easy to defend position & costly for rival firms to overtake Outsourcing  Companies taking over the functional operations of other firms Benefits  Less expensive  Allows firm to focus on core business  Enables firm to provide better services Page 68 Exam Handling Template .

MBA Comprehensive Exam Handling Steps Business level Strategies Select one of the following Structures to follow and use the Benefits & problems to justify your selection: Page 69 Exam Handling Template .

 Identify how each of the products are positioned in the market and with respect to other competitors.  Make a list of the kinds of activities they engaged in over the past year or two. For example. adjust their prices.Implemetation (Functional Level strategies) Components of a Marketing Plan  Executive Summary  Situational Analysis  SWOT (mentioned above)  PESTEL (mentioned above)  Competitive Analysis  List competitors.  Marketing Objectives: Objectives has to be SMART:  Specific  Measurable  Achievable  Realistic/ Relevant  Time bounded Examples:  Sales/ Revenue/ Turnover  Market share/ Relative market share  Awareness  Customer Satisfaction  Innovation  New customers Marketing Strategies Page 70 Exam Handling Template .  Find out who their suppliers are. etc. did they introduce new products. MBA Comprehensive Exam Handling Steps 7. embark on advertising campaigns. products. revenues (Market Share Pie Chart)  Determine the brand images of each of the competitors.

(New customers. to new geographic areas. MBA Comprehensive Exam Handling Steps Ansoff' Products Markets Existing Modified New Existing Sell more of our Modify our current Design new products that existing products to our products and sell will appeal to our existing types of more of them to existing customers. invasion) customers. (Product modification) Modified Enter and sell our Offer and sell Design new products for products in other modified products prospects in new geographical areas.  Relocating to low-cost parts of the rivals  Possible price wars cost competitor in world  erect barriers to  The difficulty of sustaining an industry while  Modification/simplification of entry it in the long term maintaining designs  resist the five satisfactory  Greater labour effectiveness forces profit margins. (Diversification) Type of Ways to achieve the strategy Benefits Possible problems strategies Cost  Size and economies of scale The ability to:  Vulnerability to even lower Leadership: Globalization  outperform cost operators Being the low. New Sell our existing Offer and sell Design new products to products to new types of modified products sell to new types of customers.  Greater operating effectiveness  Strategic alliances  New source of supply  Government Subsidies-------  New Delivery Methods------  Production Innovations------  Obtain inexpensive raw materials  Create efficient operations--  Control overhead costs------  Avoid marginal customers- Focus(Niche):  Concentration upon on or a small A more detailed Limited opportunities for sector Advantage number of a strong and specialist understanding of growth achieved when a reputation particular segments The possibility of outgrowing the firm target and  Used by small companies with The creation of barriers market effectively serve limited resources to entry The decline of the sector a small segment  used in a limited geographic market A reputation for A reputation for specialization which of the market  focused on a specific product line specialization ultimately inhibits growth and The ability to development into other sectors concentrate efforts Differentiation:  The creation of strong brand A distancing from others The difficulties of sustaining the identities and Image in the market bases for differentiation Page 71 Exam Handling Template . (Geographical geographical expansion) markets. (Segment to new types of customers. (Market our existing product development) penetration) customers.

substantial(Large and profitable enough to serve). generation. Hilton Hotels customizes according to location. Wal-Mart. education. race. family life cycle. Psychographic Segmentation Using psychology and demographics to better understand consumers. Niches are identified by dividing a segment into sub-segments. regions. use of or response to a product. rather than to create the segments. Consumers are divided into groups based on psychological/personality traits. Many people within the same demographic group can exhibit very different psychographic profiles. Niche Marketing: A more narrowly defined customer group seeking a distinctive mix of benefits. family size. Segmentation(Market segments opportunities) Not all segments are useful An ideal Market segment must be: Measurable(purchasing power can be measured). occupation. Sears and K-Mart stock different products according to the local community E. counties.Actionable(easy attracted) Page 72 Exam Handling Template .g. Geographic segmentation Dividing the market into different geographical units such as nations.differentiable (different respond to product). income. nationality and social class. gender. states. MBA Comprehensive Exam Handling Steps Advantage  The consistent pursuit of pursuit of The creation of a major Possibly higher costs achieved when a those factors which customers competitive advantage The difficulty of achieving true and firm provides perceive to be important Flexibility meaningful differentiation something that is  High performance in one or more of unique and a spectrum of activities valuable to  Strong dealer network buyers beyond  Product reliability and Servic simply offering a lower price  STP Segmentation Market Segment: a group of consumers who share a similar set of needs and wants. Hyper One Demographic Segmentation Dividing the market into groups on the basis of variables such as age. Behavioral Segmentation Buyers are divided into groups based on their attitude toward. Marketer’s task is to identify them. lifestyle or values. religion. accessible(effectively reached). cities or neighborhoods.

MBA Comprehensive Exam Handling Steps Page 73 Exam Handling Template .

What exactly the customer gets? "Competitive advantage". profitability. positively evaluate. scales economies and low risk Targeting approaches: Mass market (Product oriented marketing program): All Segments are the same so I will focus on my product rather than the customer and I will apply undifferentiated marketing program Full market coverage (diff. diff. Successful positioning strategy involves the total marketing mix. products. MBA Comprehensive Exam Handling Steps Targeting Targeting (segmentation evaluation):-we look to the segment's overall attractiveness aligned with company's objectives & resources availability Targeting Five criteria :-business marketing program for superior image product  Financial position:-High Targeting approach:. Brand Mantra Points-of-difference (PODs) Attributes or benefits consumers strongly associate with a brand. and believe they could not find to the same extent with a competitive brand Consumer desirability criteria od POD Page 74 Exam Handling Template . Using points of parity POPs and Points of Differences PODs to provide reasons to believe or proof points BY Positioning maps (according to most product beneficial features). Individuals as segments): All the market is only one segment  Financial position:-Low Targeting approach:-undifferentiated(mass marketing). Result of positioning: a customer focused value proposition.Multiple segment specialization" product specialization" approach Positioning Positioning: is the act of designing the company’s offering and image to occupy a distinctive place in the target market’s mind within a certain competitive frame of reference. groups): market is divided into few segments so I will make a marketing plan for each Multiple segments specialization: "Product Specialization) OR "Market specialization" : I will take the best 3 segments of the market Single segment (customer oriented marketing prog. growth.

the business unit should consider the following possible sources: Attribute positioning: The Company positions itself on some attribute or feature. Positioning by feature is normally a weak choice since no benefit is explicitly claimed. Benefit positioning: The product promises a benefit. A hotel describes itself as the city’s tallest hotel. Tide claims that it cleans better. usually indicates a category membership Perceptual (positioning) Map: In searching for a specific positioning. Page 75 Exam Handling Template . MBA Comprehensive Exam Handling Steps  Relevance  Distinctiveness  Believability  Feasibility  Communicability  Sustainability Points-of-parity (POPs) Associations that are not necessarily unique to the brand but may be shared with other brands.

Apple Computer describes its computers and software as the best for graphic designers. But buyers think in terms of value for the money: what they get for what they pay. The seller must value-position the brand. and so on. One can find very expensive restaurants. craftsmanship. Competitor positioning: The product suggests its superiority or difference from a competitor’s product. One is surprised occasionally at the entry of a new competitor who sets an unusually high price. User positioning: The product is positioned in terms of a target user group. durability. Xerox means copy machines. Avis described itself as a company “that tries harder” (than Hertz. Taco Bell represents its tacos as giving the most value for the money. 7 UP called itself the Uncola. Haagen-Dazs came in as a premium ice cream brand at a price never before charged for ice cream. Irrelevant positioning: Claiming a benefit which few prospects care about Doubtful positioning: Claiming a benefit that people will doubt the brand or company can actually deliver 1. without mentioning anything about how the brand will be priced. brandies. Companies must avoid the following errors in positioning their brand: Under-posirioning: Failing to present a strong central benefit or reason to buy this brand Over-posirioning: Adopting such a narrow positioning that some potential customers may overlook the brand Confused positioning: Claiming two or more benefits that contradict each other. Called luxury goods. performance. Choosing a Value Positioning We have discussed the selection of one or more specific benefits that the brand will advertise. Examples include Mercedes automobiles. Often the price far exceeds the actual increment of quality. MBA Comprehensive Exam Handling Steps Use/application positioning: The product is positioned as the best in a certain application. Starbucks came in Page 76 Exam Handling Template . Mont Blanc writing instruments. Nike might describe one of its shoes as the best to wear for racing and another as the best to wear for playing basketball. coffees. or style. Category positioning: The Company may describe itself as the category leader. Quality/price positioning: The product is positioned at a certain quality and price level. We can distinguish five value positions. such products claim to be better in quality. The product is not only fine in itself. and Gucci apparel. it is delivering prestige to the buyer. More for More Companies can always be found that specialize in making the most upscale version of the product and charging a high price to cover their higher costs. hotels. by implication).

based on superior purchasing power. in general. Mercedes car owners in many American cities ended tip making their next car purchase a Lexus. One cannot say to a hotel. Lexus advertising shows the Mercedes and Lexus side by side and the superior qualities of the Lexus. Less for Much Less Some people complain that some manufacturers or service providers provide more than they require but they still have to pay the higher price. and through evidence that Lexus dealerships were providing a better buying experience than Mercedes dealerships. “take out the TV set and charge me less. MBA Comprehensive Exam Handling Steps as an expensive coffee where coffee could always be had for much less. some Cuban cigar brands command an unbelievably high price. Yet more-for-more brands are vulnerable: They often invite imitators who claim the same quality but are priced lower. Everything—Arrow shirts. “skip the food and charge me less. Since that time the Lexus repurchase rate has been 60 percent twice that of the average car brand repurchase rate. The Same for Less It seems that everyone is happy when they can buy a typical product or brand at less than the normal price.” or tell an airline. but they can offer ordinary brands at deep savings. And luxury goods are at risk during economic downturns when buyers become more cautious in their spending.” Therefore sellers have an opportunity to enter a market with a “less for much less” offering. a company should be alert to the possibility of introducing a “much more for much more” brand in any underdeveloped product or service category. Goodyear tires. More for the Same Companies have been able to attack a “more for more” brand by introducing a brand claiming comparable quality and performance but priced much lower. Discount stores don’t claim to have superior products. The Toyota company introduced its new Lexus automobile with “more for the same” value positioning. Panasonic TV sets—seems to be available at a lower price at some store or discount shop. There is a hotel in Tokyo that rents not a room but a berth for substantially less than the normal hotel Page 77 Exam Handling Template .

the winning value positioning would be to offer prospects and customers more for less.How is your product moved around? 11. How do consumers find your offering? 3. How do consumers make their final selections? 4. sees a whole array of attractively laid-out. How is your product or service delivered? 6. Product & Service Strategy: 1. air carrier.” This is the attraction of highly successful category killer stores. How is your product or service paid for? 9. Marketing Mix: A. Southwest Airlines. How is your product stored? 10. How do consumers order and purchase your product or service? 5. not assigning seats. finds everyday low prices. More for Less Of course. Line extension: additional items in the same product under the same brand Advantage:  Saving cost  Minimize risk in introducing new products Disadvantage:  Brand dilution Page 78 Exam Handling Template . the most profitable U.S. not using travel agents.What happens when your product is disposed of or no longer used? 1. well-known branded goods. MBA Comprehensive Exam Handling Steps price. How do people become aware of their need for your products or service? 2. How is your product installed? 8.How is your product repaired or serviced? 15.What is the customer really using your product for? 12. and leaves thinking of Wal-Mart as a place where he or she can get more for less. Sportmart offers the largest selection of sports equipment and sports clothing for the lowest prices.What about returns or exchanges? 14. What happens when your product or service is delivered? 7. and not transferring luggage to other carriers. and generous return policies.What do customers need help with when they use your product? 13. one meets a friendly greeter. charges much less by not serving food. Mass merchandisers make a similar claim: walking into a Wal-Mart store.

multi branding: new brand name in the same product Advantage:  establish different features  appeal to different buying motives Disadvantage:  multi branding might gain only small market share  need resources on building different brands B. games. Stakes. Promotion Advertising Sales Promotion Public Sales Force Direct Relations Marketing Print and Contests. brand extension: launching new product under the same brand Advantage:  Saving high advertising cost and build brand name  Give new products instant recognition and faster acceptance Disadvantage:  consumer confusion about the brand image and may loose its positioning  may harm consumer attitude toward other product under the same brand 3. Press kits Sales Catalogs broadcast sweep presentations ads Packaging. MBA Comprehensive Exam Handling Steps  consumer confusion  Cannibalization on original product 2. lotteries Speeches Sales meetings Mailings outer Packaging Premiums and gifts Seminars Incentive Telemarketing inserts programs Motion Sampling Annual Samples Electronic pictures reports shopping Brochures Fairs and trade Charitable Fairs and trade TV shopping and shows donations shows booklets Page 79 Exam Handling Template .

Public relation Used when:  Building up good corporate image  Heading off unfavorable rumors 4. Advertising Used when:  Build up long term image  Cost efficient in reaching geographically dispersed buyers  Trigger quick sales  Gives image of good value to the brand 2. MBA Comprehensive Exam Handling Steps Posters and Exhibits Sponsorships Fax mail leaflets Directories Demonstrations Publications E-mail Reprints of Coupons Community Voice ads relations Billboards Rebates Lobbying Display Low-interest Identity signs financing media Point-of. Sales promotion Used when:  Encourage trial or purchase  Short run effect  Boosting sagging sales 3. Continuity programs visual material Symbols Tie-ins and logos Videotapes 1. Personal selling Used when: Page 80 Exam Handling Template . Entertainment Company purchase magazine Displays Trade-in-allowances Events Audio.

Selecting channels Page 81 Exam Handling Template . Direct and interative marketing Used when:  Targeted individual consumers  Localized and customized used to reach well defined target segments C. Evaluting alternatives channels Based on:  Channels cost  Sales output  Product complexity 3. Identify major alternatives channels Number of intermediary:  Exclusive distribution  selective distribution  intensive distribution 2. Distribution & Place: Channel Decisions: • Channels Coverage • Assortments • Locations • Inventory • Transport Channel design decisions: • Push strategy • Pull strategy Types of Distribution Channels (Number of intermediaries) • Exclusive distribution • Exclusive dealing • Selective distribution • Intensive distribution 1. conviction and solicit action  Build up buyers 5. MBA Comprehensive Exam Handling Steps  Making sales  Building customer relations preference.

the objective task method is a system in which a company allocates a certain amount of money to its marketing budget based on specific objectives. it costs to distribute a product and costs to promote it. marketing communications.  Percentage of last year Sale  Same as Last time (SALT)  All You Can Afford  Profit Maximization  Competitive Parity D-Pricing Strategies Pricing is one of the most important elements of the marketing mix. MBA Comprehensive Exam Handling Steps Based on:  Years on business  Growth record  Financial strength  Service reputation Inventory management  Manufacture focused  Time based market focused Budgeting A typical marketing budget will include: market research.  Task Method: Also known as the "objective and task" method. The remaining 3p’s are the variable cost for the organisation. rather than choosing an arbitrary amount or basing its marketing budget on sales revenues or projections alone. which generates a turnover for the organisation. etc. It costs to produce and design a product. Price must support these elements of the mix. as it is the only mix. salaries for marketing staff. Pricing is difficult and must reflect supply and Page 82 Exam Handling Template . travel costs.

The seller will therefore charge 99p instead £1 or $199 instead of $200  Premium pricing: The price set is high to reflect the exclusiveness of the product. Proposed positioning strategies. The pricing strategies are based much on what objectives the company has set itself to achieve. Target group and willingness to pay. Page 83 Exam Handling Template . An example would be a video manufacturer offering different video recorders with different features at different prices. 2.  Product Line Pricing: Pricing different products within the same product range at different price points. Pricing should take into account the following factors: 1. first class airline services. Competition 3.  Bundle Pricing: The organisation bundles a group of products at a reduced price. This form of price discrimination assists the company in maximising turnover and profits. The greater the features and the benefit obtained the greater the consumer will pay.  Penetration pricing: Where the organisation sets a low price to increase sales and market share.  Skimming pricing: The organisation sets an initial high price and then slowly lowers the price to make the product available to a wider market. Fixed and variable costs. Company objectives 4. MBA Comprehensive Exam Handling Steps demand relationship.  Competition pricing: Setting a price in comparison with competitors. The objective is to skim profits of the market layer by layer. Pricing Strategies An organisation can adopt a number of pricing strategies. porsche etc. An example of products using this strategy would be Harrods. 5. Pricing a product too high or too low could mean a loss of sales for the organisation.  Psychological pricing: The seller here will consider the psychology of price and the positioning of price within the market place.

Metrics (KPIs) • Customer satisfaction • Revenue growth • Market share • Customer retention rates . Product quality leadership : relative prices are set at a premium Used when:  brands perceived relative high quality 4. Market skimming: initial prices are set high and gradually reduced to capture greet number of market segments Used when:  sufficient number of buyers have a high current demand  high price communicates the image of superior product 3. Reflecting product differentiation : Used when:  Target different segments it different products Evaluation Marketing mix activities should be accompanied by market driven metrics. MBA Comprehensive Exam Handling Steps  Optional pricing: The organisation sells optional extras along with the product to maximise its turnover. Page 84 Exam Handling Template . 1. Early cash recovery : Used when:  Faced with problem of liquidity  Belief that the product life is likely to be short Can be delivered by:  Mass distribution  Rigorous credit control policy  Special offers  Discount to trigger immediate sales and prompt payment 5. Market penetraion: set low prices to ensure high level of sales used when:  market is highly price sensitive  low price simulate market growth  production and distribution cost fall with in accumulated production experience 2. This strategy is used commonly within the car industry.

LITTLE FORMALIZATION. turnover and so on” and organization Select one of the following Structures to follow and use the Advantage and disadvantage to justify your selection:  SIMPLE STRUCTURE:  OWNER-MANAGER MAKES DECISIONS. otherwise. plan to leverage the employees skills (through Training) or low moral (Through compensation plan). he is replaced by as team of managers who have functional specializations.  FEW RULES.  LITTLE SPECIALIZATION OF TASKS. ADVANTAGES:  Provides high flexibility  Rapid product introduction  Few coordination problems  FUNCTIONAL STRUCTURE: The company rather being lead by an entrepreneur. The entrepreneur must learn now to delegate his responsibilities. The Value Proposition is used to define and prove the economic or strategic benefit of the product or service for a given target market o Structure Changes involves: HR Functional Plan “i. MBA Comprehensive Exam Handling Steps Key practices to consider in the marketing mix are the creation of value propositions and in positioning the product.e. the new structure will yield no benefit ADVANTAGES  Centralized control of operations  Promotes in-depth functional expertise  Enhances operating efficiency where tasks are routine DISADVANTAGES  Functional coordination problems  Inter-functional rivalry  Overspecialization and narrow viewpoints  Hinders development of cross-functional experience  Slower to respond in turbulent environments  DIVISIONAL STRUCTURE: Page 85 Exam Handling Template .

The matrix structure is the common solution for the organizations that pursues the growth strategies in a dynamic and complex environment  Functional & product form are combined simultaneously at the same level. The matrix structure in the multinational organizations offers a flexibility to deal with the regional differences as well as the multi products. programs or regional needs. product or program. The matrix is formed by using permanent cross functional teams to integrate functional expertise in support of a clear divisional focus on project.  Employee have 2 superior. functional superior & horizontal product manager WHEN TO USE?  Scarce resources  Ideas need to be cross fertilized across projects  External environment is very complex and changeable Distinct phase exist in the DEVELOPMENT OF matrix structure Page 86 Exam Handling Template . MBA Comprehensive Exam Handling Steps It occurs especially when the organization is managing diverse product line or when the organization is expanding to cover wider geographical areas ADVANTAGES:  Decentralized decision making  Each business is organized around products  Puts profit/loss accountability on manager  Facilitates rapid response to environmental changes  Allows efficient management of a large number of units DISADVANTAGES  May lead to costly duplication of functions  Inter-divisional rivalry  Corporate managers may lose in-depth understanding  MATRIX STRUCTURE It combines the functional and divisional structure. It is designed to gain the advantage and minimize the disadvantages of the functional and divisional structures.

ADVANTAGES:  Rapid response time  Firm’s emphasize their own core competencies  Very flexible  Reduces capital intensity . Benetton use the network structure on their operation functions by subcontracting manufacturing to other companies in low cost location around the world. functional & product structure are permanent.  MATURE matrix: A true dual authority structure. Reebok. PRODUCT MANAGER ACT AS INTEGRATOR OF SEMI PERMANENT PRODUCT OR BRAND. MBA Comprehensive Exam Handling Steps  TEMPORARY CROSS FUNCTIONAL TASK FORCES: PROJECT MANAGER IS IN CHARGE AS THE KEY HORIZONTAL LINK  PRODUCT OR BRAND MANAGEMENT: THE FUNCTIONAL IS STILL THE PRIMARY ORGANIZATIONAL STRUCTURE.  NETWORK STRUCTURE  MANY ACTIVITIES ARE OUTSOURCE  SERIES OF INDEPENDENT FIRMS OR BUSINESS UNITS THAT ARE LINKED TOGETHER BY COMPUTERS IN AN IS  USED when the environment is unstable Nike. Page 87 Exam Handling Template .

receiving. etc. Operations: Machining. training. b. product and process improvement. style. Firm Infrastructure Includes: General management. c. public affairs. training. MBA Comprehensive Exam Handling Steps EXTRAS Value Chain Model It is a model that helps to analyze specific activities through which firms can create value and competitive advantage 1. distribution management of finished goods) d. promotion. Outbound Logistics The activities required to get the finished product to customers: Warehousing. installation. Human Resource Management The activities associated with recruiting. quality management. selling. accounting. shared values. Support Activities a. buildings. process automation. etc. Procurement Purchasing of raw material. legal. structure. packaging. finance. design and redesign d. Technology Development Includes technology development that supports value chain activities such as R&D. Services The activities that maintains and enhance product’s value including: customer support. systems. c. Primary Activities a. etc. in order to identify if they are effectively aligned and allow organization to achieve its objectives. strategic planning (planning management. Assembling. Page 88 Exam Handling Template . development retention and compensation of employees and managers. machines and supplies. spare parts. inventory control and transportation scheduling b. pricing. transportation. Inbound Logistics: Raw material handling and warehousing. Testing. Mckinsey 7S McKinsey 7s model is a tool that analyzes firm’s organizational design by looking at 7 key internal elements: strategy. staff and skills. Marketing and Sales The activities associated with getting buyers to purchase the product including: channel selection. and servicing. retail management. storing. equipment maintenance and all other value creating activities that transform the input into final product. spare part management upgrading. order fulfillment. 2. advertising. e.

and are less tangible and more influenced by culture. The most common uses of the framework are:  To facilitate organizational change. So the key in 7s model is not to look at your company to find the great strategy.  To identify how each area may change in a future. but to look if its aligned with other elements. can be more difficult to describe. these soft elements are as important as the hard elements if the organization is going to be successful. MBA Comprehensive Exam Handling Steps The model can be applied to many situations and is a valuable tool when organizational design is at question. 1. systems and etc. But it’s hard to tell if such strategy is well-aligned with other elements when analyzed alone. a sound strategy is the one that’s clearly articulated. and formal processes and IT systems. is long-term. Questions  What is our strategy?  How do we intend to achieve our objectives?  How do we deal with competitive pressure?  How are changes in customer demands dealt with? Page 89 Exam Handling Template . For example. However. What does a well-aligned strategy mean in 7s McKinsey model? In general. helps to achieve competitive advantage and is reinforced by strong vision. Strategy is a plan developed by a firm to achieve sustained competitive advantage and successfully compete in the market. Strategy: the plan devised to maintain and build competitive advantage over the competition.  To facilitate the merger of organizations The McKinsey 7-S model involves seven interdependent factors which are categorized as either "hard" or "soft" elements: Hard Elements Soft Elements Strategy Shared values Structure Skills System Style Staff "Hard" elements are easier to define or identify and management can directly influence them: These are strategy statements. "Soft" elements. on the other hand. then it may provide strong results.  To help implement new strategy. short-term strategy is usually a poor choice for a company but if its aligned with other 6 elements. structure. organization charts and reporting lines. mission and values.

Flat organizations focus on empowering employees rather than adhering to the chain of command. given what we're doing?  Where are the lines of communication? Explicit and implicit? The way that a company’s structure develops often falls into a tall (vertical) structure or a flat (horizontal) structures. there is no definitive number that draws a line between the two. Tall Structure Pros And Cons The pros of tall structures lie in clarity and managerial control. By encouraging autonomy and self-direction. Flat organizational structures differ in that there are fewer levels of management and employees often have more autonomy. In other words. In a tall structure. Structure: the way the organization is structured and who reports to whom. with each level controlling a broad area or group. MBA Comprehensive Exam Handling Steps  How is strategy adjusted for environmental issues? 2. flat structures attempt to tap into employees’ creative talents and to solve problems by collaboration. structure is the organizational chart of the firm. As an organization grows. a tall structure results in one long chain of command similar to the military.  How is the company/team divided?  What is the hierarchy?  How do the various departments coordinate activities?  How do the team members organize and align themselves?  Is decision making and controlling centralized or decentralized? Is this as it should be. Tall structures provide a clear. complex organizations often require a taller hierarchy. the number of management levels increases and the structure grows taller. Tall Organizational Structure Large. In its simplest form. The narrow span of control allows for close supervision of employees. Although tall structures have more management levels than flat structures. Flat Organizational Structure Flat structures have fewer management levels. Tall structures are more of what we think of when we visualize an organizational chart with the CEO at the top and multiple levels of management. managers form many ranks and each has a small area of control. Challenges begin when a structure gets too tall. Page 90 Exam Handling Template . Communication begins to take too long to travel through all the levels. distinct layers with obvious lines of responsibility and control and a clear promotion structure. It is also one of the most visible and easy to change elements of the framework. These communication problems hamper decision-making and hinder progress. Structure represents the way business divisions and units are organized and includes the information of who is accountable to whom.

The heavy managerial workload and large number of employees reporting to each boss sometimes results in confusion over roles. Style represents the way the company is managed by top-level managers. Flatter structures are flexible and better able to adapt to changes. Faster communication makes for quicker decisions. his job becomes impossible. tolerant and even vulnerable.  How participative is the management/leadership style?  How effective is that leadership? Page 91 Exam Handling Template . leaders must share research and information instead of hoarding it. Employees often worry that others manipulate the system behind their backs by reporting to the boss. it is the management style of company’s leaders. these are the core values of the company that are evidenced in the corporate culture and the general work ethic. Shared Values are at the core of McKinsey 7s model. that means more employees distrusting higher levels of authority. how they interact. When too many people report to a single manager.  What are the main systems that run the organization? Consider financial and HR systems as well as communications and document storage. 3.  What are the core values?  What is the corporate/team culture?  How strong are the values?  What are the fundamental values that the company/team was built on? 5. there are more people at the “top” of each level. Instead of the military style of tall structures. That is. In other words. If they can manage to be open. Systems: the daily activities and procedures that staff members engage in to get the job done. are the foundation of every organization. but managers may end up with a heavier workload. Bosses must be team leaders who generate ideas and help others make decisions. in a flat organization.  Where are the controls and how are they monitored and evaluated?  What internal rules and processes does the team use to keep on track? 4. They are the norms and standards that guide employee behavior and company actions and thus. what actions do they take and their symbolic value. Systems are the area of the firm that determines how business is done and it should be the main focus for managers during organizational change. which reveal business’ daily activities and how decisions are made. Shared Values: called "superordinate goals" when the model was first developed. For flat structures to work. Systems are the processes and procedures of the company. leaders excel in this environment. flat organizations lean toward a more democratic style. Style: the style of leadership adopted. MBA Comprehensive Exam Handling Steps Flat Structure Pros And Cons Flat organizations offer more opportunities for employees to excel while promoting the larger business vision.

personnel management and new business generation systems. Staff: the employees and their general capabilities. The systems are mainly concerned with customer support and order processing. During organizational change.  What positions or specializations are represented within the team?  What positions need to be filled?  Are there gaps in required competencies? 7. the question often arises of what skills the company will really need to reinforce its new strategy or new structure. Staff element is concerned with what type and how many employees an organization will need and how they will be recruited. Skills are the abilities that firm’s employees perform very well. Staff Few employees are needed for an organization. Skills: the actual skills and competencies of the employees working for the company. They also include capabilities and competences. MBA Comprehensive Exam Handling Steps  Do employees/team members tend to be competitive or cooperative?  Are there real teams functioning within the organization or are they just nominal groups? 6. There are no or few strategic planning. Page 92 Exam Handling Template . Skills Few specialized skills and the rest of jobs are undertaken by the management (the founders). motivated and rewarded. trained. of which market value is rising. They are motivated by successful business growth and rewarded with business shares.  What are the strongest skills represented within the company/team?  Are there any skills gaps?  What is the company/team known for doing well?  Do the current employees/team members have the ability to do the job?  How are skills monitored and assessed? Examples: Strategy Market penetration Structure Simple structure Systems Few formal systems.

MBA Comprehensive Exam Handling Steps Style Democratic but often chaotic management style. customer support and personnel management systems. values teamwork and trusts each other. personnel management and strategic planning systems. Skills Skills aligned with company’s operations. Page 93 Exam Handling Template . Skills Skills related to service offering and business support. Shared Values Enthusiasm and excellence Strategy Market penetration Strategy Market development Structure Bureaucratic machine Systems Order processing and control. Style Democratic but often chaotic management style. Staff Many employees and appropriate motivation and reward systems. customer support. Strategy Market penetration Strategy Market penetration Structure Bureaucratic machine Systems Order processing and control. Shared Values The staff is adventurous. but few managerial and analytical skills.

MBA Comprehensive Exam Handling Steps

Staff Employees form many cultures, who
expect different motivation and reward
Style Democratic style
Shared Values Enthusiasm and excellence
Strategy Market development

International entry options
Exporting and importing

-Licensing Arrangement: An agreement in which the licensing firm grants right to another firm in
another country or market to produce and/or sell the original company’s products.

-Franchising: franchiser grant rights to another company to open a retail using the name.

-Joint Venture: Cooperative business activity formed of two or more separate organization to form a
new independent business entity and allocates ownership and liabilities.

-Acquisition: Purchasing another company already operating in the market or in the area.

-Mutual Service Consortia: Partnership of similar companies in similar industry who pool their
resources to gain a benefit that is too expensive for each of them separately

-Value Chain Partnership: A strong and close alliance in which a company forms a long term
arrangement with a key supplier or a distributor for mutual advantage.

 Recommended Strategy
 Explain what are the most feasible alternative strategies available to the firm and what are the pros and
cons of each?

1-Market-leader strategies

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MBA Comprehensive Exam Handling Steps

a-New Users
 market-penetration strategy,
 new market- segment strategy-
 geographical -expansion strategy

b-New Uses
 discovering and promoting new uses for the product.
c-More Usage
 convince people to use more products per use occasion.

2-Market-challenger strategies

 Price discount:
 Lower price goods
 Prestige goods
 Product proliferation
 Product innovation
 Improved services:
 Distribution innovation
 Manufacturing-cost reduction
 Intensive advertising promotion
3-Market-follower strategies
present similar offers to buyers by copying the leader.

 Imitator: The imitator copies some things from the leader
 Adapter: The adapter takes the leader’s products and adapts
4-Market-nicher strategies
The Nichers have three tasks to achieves high margin,not like mass- high volume.:

 creating niches,
 expanding niches,
 protecting niches.

A. Implementation

 Management commitment
 Employee empowerment
 Reward System
 Integrating training
 Process improvement
 Quality at source

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MBA Comprehensive Exam Handling Steps
The implementation process has already been started by Top management ,as follow.

•Provide financials to implement the recommended strategies as outlined above.

•Board members with more global business experience should be recruited with an eye on the future and market
potential in local and international markets.

Develop more programs that invest in employees’ capability to handle international operations and increased
competition locally and internationally.

•Develop more customer-retail relationship programs

•Create new job rotational programs locally and internationally within for more exposure of employees and

•A TQM department should be structured to ensure quality and customer service leadership. As mentioned before
the company has implemented several principles of total quality management philosophy, such as:

1. Management commitment: creating committed management to the process of continuous improvement, a
dedication to empowering people to change, and to periodically raise the goals for improvement. Adoption
and communication of TQM: using tools like mission statement and slogans.

2. Employee empowerment: giving workers the responsibility for improvements and the authority to make
changes to accomplish them.

3. Reward System: is the missing link that motivates managers and employees to "walk the talk" and use TQM
to the fullest and it's divided into two groups, monetary and non-monetary rewards.

4. Integrating training: includes different aspects of TQM elements, team skills and problem-solving

5. Process improvement: process of reducing waste and cycle times in all areas through cross-departmental
process analysis.

6. Quality at source: the philosophy of making each worker responsible for the quality of his/her work

B. Evaluation and Control
is a leader in the industry for ,,,,,,,,. All they have to do is continue with periodic management evaluations and rely
on their distinctive competences of customer service and achieve better utilization of the company current & fixed

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Page 97 Exam Handling Template . MBA Comprehensive Exam Handling Steps 5. o Recommend procedures for strategy review and evaluation.  Prepare forecasted ratios and projected financial statements.  Present a timetable or agenda for action.  Recommend specific annual objectives and policies o Identify the business impact on the current situation. Conclusion/ Epilogue ‫الخاتمة‬ o Specify how your recommendations can be implemented and what results you can expect.