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CIMA E3 - Strategic Management Question Tutorial Sample Questions:

1. Z is a medium-sized UK based accounting practice. Z operates a graduate training scheme. The trainees are given an induction and then placed on a three-year training programme designed to help develop professional skills and experience.
The training programme has been in existence for many years. However, there is no clear consensus amongst the partners of Z about what the trainees should be able to do on completion of the programme and therefore what the training programme should emphasize. This lack of clarity is affecting the morale and commitment of the trainees and significant numbers are failing the programme or leaving to join a rival firm.
Z's HR Department recognizes the need for committed and well motivated accountants to meet the increased expectations of clients and the competition from rival firms. The HR Department has identified changes to the training programme that can be implemented gradually through a series of initiatives.
Which TWO of the following statements regarding the change required in Z are correct? (Choose two.)

A) The change would be classified as a 'revolutionary change' according to Balogum and Hope Hailey.
B) Understanding which day-to-day behaviors to reinforce within the training programme, is about 'routines and rituals' according to the Cultural Web.
C) The need to manage the competitive position is an example of an 'external direct trigger' for change.
D) The skills, abilities and competences of the organization's employee's are a 'hard' factor according to the McKinsey 7 S model.
E) The plans to combat competition would be considered as a 'structure' factor according to the McKinsey 7 S model.

2. M has been appointed as an external change agent to lead and implement a large scale re-structuring strategy which is being undertaken by a large bank. M has been appointed due to his extensive experience in a wide range of organizational re-structuring programmes. This re-structuring strategy will involve a large number of redundancies and the implementation of a new organization-wide management reporting system. M will need to work with staff from all departments and levels of the organization. The Board of Directors of the bank believes that an external change agent will bring more benefits to the change process than using an internal change agent.
Which of the following are the most likely benefits that could be achieved by the bank by appointing an external change agent to lead and implement the re-structuring strategy? (Choose all that apply.)

A) The change process should be less costly if an external change agent is appointed.
B) The external change agent will have better relationships with the bank employees than an internal change agent.
C) The speed of delivery of the change process will be quicker when using an external change agent.
D) The bank can exploit the specialist expertise of the external change agent.
E) The external change agent will be more objective in decision-making than an internal change agent.
F) As a dedicated resource, the external change agent can give more time to the change process.

3. HHH is a manufacturer which has a bonus scheme for its production workers related to the speed of output.
HHH's products are very specialized and are made in a dangerous production environment. HHH's production workers usually work alone but sometimes, if there are problems in the production environment (for example, machinery breakdowns), they have to work in teams. When the production workers are working in teams they do not receive any bonus.
HHH's senior management is proposing to amend the current bonus scheme to encourage increased productivity. Under the current bonus scheme, production workers receive extra pay when they achieve 45% of their individual target: The target level is low because of the dangerous production environment and the need to occasionally work in teams.
Under the proposed bonus scheme, production workers will not receive any extra pay until they have achieved
90% of their individual target. Workers who achieve 90% or above of their individual target will be paid a 30% higher bonus.
Which THREE of the following problems is HHH most likely to encounter with the introduction of the proposed bonus scheme? (Choose three.)

A) The proposed bonus scheme conflicts with health and safety legislation.
B) Production workers will not be motivated by the proposed level of bonus.
C) The extra production output will lead to an increase in inventory.
D) There could be a rise in the level of workplace accidents.
E) Production workers could consider the new target as unachievable.

4. DF Company is undertaking a strategic review of its activities and has asked you to explain how a Force Field analysis would assist in the review process.
Which of the following statements would be most appropriate?

A) Identify influential senior managers who will drive through changes in DF's strategic direction.
B) Identify forces facing DF's activities that may create barriers and resistance to change.
C) Provide a framework for identifying forces for and against the proposed changes within DF.
D) As part of DF's strategic review, identify forces facilitating the need for proposed change.

5. RST is a company specializing in the production of wood-based products. RST has decided to introduce a fully integrated Information System across all divisions in order to improve knowledge sharing throughout the business and enhance customer relationship management.
RST is expecting resistance to the integrated Information System from it's staff who are key to the business and would be difficult to replace. Staff have a good understanding of why the new system and knowledge sharing is needed and how the system will work but many staff are not happy about the potential changes to their working conditions.
Which of the following change leadership styles, as outlined by Kotter and Schlesinger, would be most appropriate for RST to adopt?

A) Coercion
B) Manipulation
C) Negotiation
D) Education

Solutions: