Page 18 - MCS August Day 1 Suggested Solutions

CIMA AUGUST 2018 – MANAGEMENT CASE STUDY

EXERCISE 3
Strategic decision making requires the consideration of stakeholders. How these stakeholders are
affected by or can affect strategic developments is assessed by the use of two parameters:

Stakeholder Power
Stakeholders can affect the success of a strategy, depending on whether they support or oppose
it. For example, the lack of availability of suitably skilled staff would disrupt MONTEL’s strategy of
“maintaining market share” via “technical innovation and product quality” potentially resulting in
lost customers, damaged reputation and brand. MONTEL must therefore consider stakeholders
before setting, revising or implementing strategic objectives.

Power may be assessed by considering for example:

 The status of the stakeholder
 The claim on resources that the stakeholder has
 Level of representation in the decision making process

Stakeholder Interest
MONTEL must ensure that its decisions do not ignore the interests of all stakeholders, not just the
shareholders of the company, for example the trade unions and associations who will be
interested to protect the best interest of their members e.g. the Camera and Imaging Products
Association

Interest may be assessed by considering for example:

• employees – require reward, job security, good working conditions

• customers – a complex area for MONTEL given that there are many different socio‐
demographic groups who will have a variety of demands such as fair prices, quality etc. It
would however seem that the main requirements for customers are quality, reliability and
of course “value for money”.

• suppliers – with the exception of glass, this is not a complex area for MONTEL given that
they manufacture their own components. The supply of quality glass is however
fundamental to the camera lenses and they will require payment on time, fair negotiations,
etc., some of which will be subject to contractual agreement.

• governments – imposing taxation, tariffs and changes in legislation on imports could be
very significant for a worldwide company.

Stakeholders may be categorised for MONTEL as follows:

• internal stakeholders are those individuals inside the company whose objectives are likely to
have a strong influence on how it is run. Internal stakeholders for MONTEL would include
Directors and management, employees etc.

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