On Thu, Dec 22, 2011 at 3:35 PM, Muhammad Imran <mc090401446@vu.edu.pk> wrote:
> --
> *1
> Question No: 29 ( Marks: 3 )
> Planning function is mostly carried out by managers in strategy
> formulation stage. What
> activities are performed under this function?
> Strategic formulation means a strategy formulate to execute the
> business activities. Strategy
> formulation Includes developing:-
> 1-Vision and Mission Statement (target of the organization)
> 2-Stregnths and Weaknesses.(Internal factors.)
> 3-Opportunities and Threats.(External factors)
> Strategy formulation is concerned with setting long term goals and
> objectives, generating
> strategies to achieve those goals.
> Strategy formulation is also concerned with setting long term goals
> and objectives, generating
> alternative strategies to achieve that long term goals and choosing
> particular strategy to pursue.
> Page #3&4
> Question No: 30 ( Marks: 3 )
> What should be the characteristics of a firm that is successfully
> pursuing a Cost
> Leadership Strategy? Enlist any six of them.
> Answer:
> Six characteristics of successfully pursuing cost leadership strategy firm:
> 1-Limited perks.
> 2-High efficiency.
> 3- Low overhead.
> 4-Wide spans of control.
> 5-Intensive screening of budget.
> 6-Employees participation in cost control efforts.page#86
> Question No: 31 ( Marks: 5 )
> List down and explain five steps that comprise an effective framework
> for conducting an
> IFE Matrix.
> Steps involved in the development of IFE Matrix:
> 2
> 1-List any internal factors identified in the internal audit. Only ten
> to twenty factors will be
> enough including strengths and weakness. Use percentage, ratios and
> comparative numbers.
> 2-Assign weights to each factor ranging from 0 to 1.The rates assigned
> indicate the relative
> importance of each factor to being successful. Sum of all weights must
> be equal to 1.
> 3-Assign 1-4 rating to each factor to see whether the factor
> represents major weakness (rate=1)
> or minor weakness (rate=2), minor strength (rate =3 ) or major
> strength (rate=4).
> 4- Multiply each factor's weights to its ratings to determine its
> weighted score.
> 5-Sum the weighted score of each variable page#47
> Question No: 29 ( Marks: 3 )
> What activities are performed in strategy evaluation stage under
> controlling function of
> management?
> Controlling function of management includes all those activities
> undertaken to ensure that actual
> operations conform to planned operations. Controlling function of
> management is particularly
> important for effective strategy evaluation. Controlling function of
> management has the
> following activities in strategy evaluation.
> 1. Establishing performance standards
> 2. Measuring individual and organizational performance
> 3. Taking corrective actions
> 4. Comparing actual performance to planned performance standards page#59
> Question No: 30 ( Marks: 3 )
> In your opinion, what can be the circumstances when a Low Cost
> Producer in an industry
> brings effectiveness?
> Low-cost producer in an industry can be especially effective when the market is
> Composed of many price-sensitive buyers, when there are few ways to
> achieve product
> differentiation, when buyers do not care much about differences from
> brand to brand, or when
> there are a large number of buyers with significant bargaining power
> The basic idea is to under
> price competitors and thereby gains market share and sales, driving
> some competitors out of the
> market entirely. Page#86
> Question No: 31 ( Marks: 5 )
> What are the major stakeholders that affect pricing decisions?
> Following are the five major stakeholders which affect pricing decisions.
> 1. Governments
> 2. Suppliers
> 3. Distributors
> 4. Consumers
> 5. Competitors page#62
> 3
> Question No: 32 ( Marks: 5 )
> Mergers or acquisitions are the methods by which two companies combine
> to form a larger
> company. What can be the reasons for achieving mergers or acquisitions?
> The 1st reason for acquisition and merger to combine is that they
> believe that synergy
> exist and by joining both of us can achieve something more than we can get
> individually.
> Acquisition and merger join to spread its risks and exploit new markets.
> The idea is that the larger firm resulting from the merger can
> produce more cheaply
> than the previously separate firms.
> firms may derive tax advantages from a merger or acquisition
> Gain new technology
> Gain economies of scale
> Improve capacity utilization
> Question No: 32 ( Marks: 5 )
> Give at least two examples of multinational or local firms that are
> operating in Pakistan
> and have initiated backward integration. Justify your answer?
> Explain concentric diversification strategy with the help of two
> examples of local or
> multinational firms operating in Pakistan?
> 1. List down and explain five steps that comprise an effective framework for
> conducting an EFE Matrix.
> Five-Step process:
> List key external factors (10-20)
> Opportunities & threats
> You have to prepare a list of all external factors which will affect
> the EFE matrix. These factors
> should be
> two points to be kept in mind these are opportunities and threats.
> Assign weight to each (0 to 1.0)
> Sum of all weights = 1.0
> Now you have to arrange them according to their weight age that which
> factor is most important.
> It should
> be weight age in % ages. The sum of the total of all the factors
> should always be one.
> Assign 1-4 rating to each factor
> • Firm's current strategies response to the factor: how well firms
> response to these factors.
> Multiply each factor's weight by its rating
> • Produces a weighted score
> How the firm will respond to these factors external factors. Such
> criteria are known as rating.
> Sum the weighted scores for each
> 4
> Determines the total weighted score for the organization.
> • Highest possible weighted score for the organization is 4.0; the
> lowest, 1.0. Average = 2.5
> PAGE#44
> Q_1) what is average collection period? (3 marks)
> The approximate amount of time that it takes for a business to receive
> payments owed, in terms
> of receivables, from its customers and clients.
> Calculated as:
> Where:
> Days = Total amount of days in period
> AR = Average amount of accounts receivables
> Credit Sales = Total amount of net credit sales during period
> http://www.investopedia.com/terms/a/average_collection_period.asp
> Q_2) Suppose according to the EFE matrix, the weighted score of a
> certain company is
> 2.10. How that company will interpret this score in terms of its
> external factors? (3 marks)
> see page#44 to 45
> Q_3) joint ventures are Lon lasting the relationship of the firms, why
> the joint ventures
> fails give the reasons? (5 marks)
> Following are the reasons of failure of joint venture.
> Cultural Differences
> Cultural and ideological differences top the list. In evaluating joint
> venture partners, most
> companies don't perform a proper compatibility and integration analysis
> Poor Leadership
> Poor or unclear leaders are another top reason of joint venture
> failure. Too often, joint venture
> partners insist on sharing a project leadership role. When the parties
> disagree, a standoff
> occurs.
> Insufficient Planning
> Insufficient planning is also one of the most prevalent reasons for
> failed joint ventures. Too
> often, a joint venture "plan" consists of nothing more than a
> statement of each party's intended
> contributions to the project and their respective share of the profits.
> Other Failure Reasons
> Other reasons of joint venture failure include poor commitment;
> disagreement over operating
> policies, strategies, and tactics; and differences in the approach
> towards management style and
> systems
> 5
> http://www.1000ventures.com/business_guide/jv_failure_reasons.html
> Q_4) what are intensive strategies, explain each with relevant example? (5 marks
> Intensive Strategies
> Market penetration, market development, and product development are
> sometimes referred to as
> Intensive strategies because they require intensive efforts to improve
> a firm's competitive
> position with existing products.
> Market Penetration
> A market-penetration strategy seeks to increase market share for
> present products or services in
> present markets through greater marketing efforts. Market penetration
> includes increasing the
> number of salespersons, increasing advertising expenditures, offering
> extensive sales promotion
> items, or increasing publicity efforts
> Market development involves introducing present products or services
> into new geographic
> areas. The climate for international market development is becoming
> more favorable. In many
> industries, such as airlines, it is going to be hard to maintain a
> competitive edge by staying close
> to home
> Product Development
> Product development is a strategy that seeks increased sales by
> improving or modifying present
> products or services. Product development usually entails large
> research and development
> expenditures. The U.S. Postal Service now offers stamps and postage
> via the Internet, which
> represents a product development strategy. Page#89
> Question No: 29 ( Marks: 3 )
> Explain test marketing and its significance for an organization.
> Answer: Test markets allow an organization to test alternative
> marketing plans and to forecast
> future sales of new products. In conducting a test market project, an
> organization must decide
> how many cities to include, which cities to include, how long to run
> the test, what information to
> collect during the test, and what action to take after the test has
> been completed. Test marketing
> is used more frequently by consumer goods companies than by industrial
> goods companies. Test
> marketing can allow an organization to avoid substantial losses by
> revealing weak products and
> ineffective marketing approaches before large-scale production begins.page#61
> Question No: 30 ( Marks: 3 )
> Vertical integration is the degree to which the firm owns its upstream
> and its downstream
> buyers. What can be the possible benefits if the firm goes for
> vertical integration?
> Answer: Benefits of vertical integration:
> Allow a firm to gain control over:
> Distributors (forward integration)
> Suppliers (backward integration)
> 6
> Competitors (horizontal integration) page#81
> What is the significance of Research and Development for an organization?
> Answer:
> Research and Development: The fifth major area of internal operations
> that should be
> examined for specific strengths and weaknesses is research and
> development (R&D). Many
> firms today conduct no R&D, and yet many other companies depend on
> successful R&D
> activities for survival. Firms pursuing a product development strategy
> especially need to have a
> strong R&D orientation.
> The purpose of research and development are as follows:
> Development of new products before competition
> Improving product quality
> Improving manufacturing processes to reduce costs page#71
> Question No: 31 ( Marks: 5 )
> What are the five forces of Porter's Five Forces Model?
> Porter's Five- Forces Model
> The central point lays the stress on rivalry of the competing firm.
> This relates to the intensity of
> the rivalry. How the firms compete with each other and to what extent?
> That should be taken into
> account very carefully. Potential entry for new competitors shows a
> balance between different
> firms competing in a market. It also refers whenever a new partner
> enter into a market he may
> become threat for one and opportunity for other competing partners. As
> all the new entries and
> existing firms are competing with each other so the new entry will
> definitely make an effect on
> every one transacting in the market. A potential development of
> substitute products also develops
> an environment of competition in the market among the competing
> partners. As all firms want to
> compete in term of quality and substitute will lasts for longer in the
> market if the quality of the
> substitute will be greater than the existing alternate. Other factors
> also have a major impact on
> the substitutes. Collective bargaining power of suppliers and
> consumers: if vendors are less in
> the market and the organizations that have to purchase from those
> vendors are more then the
> demand for those suppliers will be more as the firms have to purchase
> from that less suppliers.
> The reverse is the case if suppliers are more and buyers are less.
> Then the demand for those
> suppliers will be less. Such circumstances create difficulties in bargaining.
> These above five components constitute the basics elements for the
> competitive analysis.
> Page#43
> Question No: 32 ( Marks: 5 )
> Explain Merger and Acquisition with the help of examples (examples
> should be related to a
> multinational or local company operating in Pakistan)?
> 7
> When we use the term "merger", we are referring to the merging of two
> companies where one
> new company will continue to exist. The term "acquisition" refers to
> the acquisition of assets by
> one company from another company. In an acquisition, both companies
> may continue to exist.
> example main polka and walls or milk pack and nestle
> Question No: 31 ( Marks: 5 )
> What are the two basic types of R & D that can take place in an organization?
> Types of research and development
> Basic research:
> Basic research is experimental or theoretical work undertaken
> primarily to acquire new
> knowledge of the underlying foundation of phenomena and observable
> facts, without any
> particular application or use in view.
> Applied research:
> Applied research is also original investigation undertaken in order to
> acquire new knowledge. It
> is, however, directed primarily towards a specific practical aim or objective.
> Experimental development:
> Experimental development is systematic work, drawing on existing
> knowledge gained from
> research and/or practical experience, that is directed to producing
> new materials, products or
> devices, installing new processes, systems and services, or improving
> substantially those already
> produced or installed.
> http://www.nifustep.no/English/Pages/STATISTICS/R_and_D_Statistics/About%20R%20and%
> 20D%20Statistics/TypesofR_D.aspx?ItemId=1910&ListId=8252dfaf-6056-4ccc-b6e1-
> 7806d4dc4878
> Question No: 31 ( Marks: 5 )
> Mr. Mansoor is a finance manager of a firm. He is asked to prepare a
> financial ratio
> analysis. What can be the possible limitations of his analysis?
> Financial ratio analysis is not without some limitations. First of
> all, financial ratios are based on
> accounting data, and firms differ in their treatment of such items as
> depreciation, inventory
> valuation, research and development expenditures, pension plan costs,
> mergers, and taxes. Also,
> seasonal factors can influence comparative ratios. Therefore,
> conformity to industry composite
> ratios does not establish with certainty that a firm is performing
> normally or that it is well
> managed. Likewise, departures from industry averages do not always
> indicate that a firm is doing
> especially well or badly. Page#67
> Question No: 41 ( Marks: 5 )
> A good mission statement should include "Customer orientation", what does it
> mean? Explain it with the help of simple examples.
> 8
> Customer orientation definition: customer orientation is a set of
> activities undertaken by a
> company for the purpose of supporting beliefs in sales that allow
> considering customer needs and
> satisfaction as the major priorities of the company. Read the customer
> orientation template to
> find out how to undertake and maintain customer oriented processes in
> your organization.
> Example:
> This is the way AT&T's mission statement focuses on communication
> rather than telephones
> and ONGC's mission statement focuses on energy rather than oil and gas page#24
> Question No: 42 ( Marks: 5 )
> What are strengths and weaknesses of an organization? Explain with the
> help of examples.
> The strengths and weaknesses internal to the organization we can define as:
> Strengths: characteristics of the business or team that give it an
> advantage over others in the
> industry. Examples: As far as organizations go, strengths can include
> a known brand name and
> reputation, good quality service or products, a strong management
> team, and a strong sales staff.
> An individual can have strengths with a good word-of-mouth reputation
> and strong experience in
> an area of knowledge.
> Weaknesses: are characteristics that place the firm at a disadvantage
> relative to others.
> EXAMPLES.
> * Poor quality goods or services.
> * Damaged reputation.
> * Undifferentiated products or services (i.e. in relation to your competitors).
> Question No: 41 ( Marks: 5 )
> Critically analyze this statement, "Internal audit provides more
> opportunity for participants
> to understand how their jobs, departments, and divisions fit into the
> whole organization
> than the external audit".
> an internal audit provides more opportunity for participants to
> understand how their jobs,
> departments, and divisions fit into the whole organization. This is a
> great benefit because
> managers and employees perform better when they understand how their
> work affects other areas
> and activities of the firm. For example, when marketing and
> manufacturing managers jointly
> discuss issues related to internal strengths and weaknesses, they gain
> a better appreciation of
> issues, problems, concerns, and needs in all the functional areas. PAGE#50
> Question No: 42 ( Marks: 5 )
> What are strategies? Discuss their significance for an organization.
> Definitions :
> Strategy refers to a plan of action designed to achieve a particular goal.
> Alternative chosen to make happen a desired future, such as achievement of
> a goal or solution to a problem.
> significance for an organization:
> Strategy is more important than ever, particularly for organizations
> that want to
> differentiate themselves from others.
> The core aspects of strategies are to sustain a competitive advantage on other
> organizations
> Managers are at all time should be involved in implementing the set
> strategies.
> 9
> Strategic implementation entails the transformation of an
> organization strategies
> plan into action and ultimately into a result
> It increase its capacity to compete on the basis of its intellectual
> competencies
> Question No: 41 ( Marks: 5 )
> If CPM matrix reveals total weighted score of
> _ A is 2.50
> _ B is 1.50
> _ C is 3.24
> From above given data, how would you interpret the total weighted score of each
> firm and compare firm B with firm A and firm C.
> B is the weakest firm as compared to A and c (for more detail see page#46)
> Question No: 42 __ ( Marks: 5 )
> Staffing is one of the functions of managers. Enlist and describe any five basic
> activities to be performed under the faction of staffing?
> Staffing activities are centered on personnel or human resource
> management. Included are wage
> and salary administration, employee benefits, interviewing, hiring,
> firing, training, management
> development, employee safety, affirmative action, equal employment
> opportunity, union
> relations, career development, personnel research, discipline
> policies, grievance procedures, and
> public relations page#53
> Question No: 41 ( Marks: 5 )
> "Strategists today must possess skills to deal more legalistically and
> politically than
> Previous strategists". Elaborate this statement?
> Strategists today must possess skills to deal more legalistically and
> politically than previous
> strategists, whose attention was directed more too economic and
> technical affairs of the firm.
> Strategists today are spending more time anticipating and influencing
> public policy actions. They
> spend more time meeting with government officials, attending hearings
> and governmentsponsored
> conferences, giving public speeches, and meeting with trade groups, industry
> associations, and government agency directors. Before entering or
> expanding international
> operations, strategists need a good understanding of the political and
> decision-makings processes
> in countries where their firm may conduct business. For example,
> republics that made up the
> former Soviet Union differ greatly in wealth, resources, language, and
> lifestyle. Page#36
> Question No: 42 ( Marks: 5 )
> Explain any two intensive strategies with examples?
> Product Development:
> Developing and modifying new products and offering to the existing
> market is called product
> development strategy
> Example: Google develop a new browser Chrome for the existing internet user
> Market development:
> Developing a new market for the existing company product is called
> market development
> strategy. It Involves introducing present products or services into
> new geographic areas.
> EXAMPLE: Pakistan state oil (PSO) developing new market by exporting
> oil to Afghanistan
> Page#90
> MUHAMMAD IMRAN
> MBA complete
> MARKETING
> 03366466701
> LICCS LAYYAH*
>
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