Page 14 - CIMA MCS Workbook May 2019 - Day 1 Suggested Solutions

CIMA MAY 2019 – MANAGEMENT CASE STUDY

Key risks associated with each of these options are:

 Market penetration – industry analysts are indicating continuing growth within the
prefabricated/modular home market. JORD must continue to invest in more detailed
information to facilitate decisions which could be obtained by harnessing the benefits of
“big data”. To be complacent in this industry is not an option.
 Product development – in a similar vein to the above, manufacturers like JORD need to
enhance and embrace new technology to minimise the risk of changing trends or
technological, regulatory, political and social changes. Failure to do so could dramatically
affect the long term future of industry players such as JORD. The key risk in this context is
having the competences in place to do so.
 Market development – this would be a risk for JORD without a detailed understanding of
new markets or segments targeted. The risk maybe greater as a result of given the recent
slowdown in the market in Corvola and given that JORD will have considerable deficiencies
in its knowledge by its lack of representation in different countries.
 Diversification – the risk here lies with the lack of relevant skills, resources and

competences which is typical of diversification. JORD may need to consider different
expansion options to secure these skills such as acquisition or joint ventures e.g. to harness
changing work place culture needs. Despite a very positive cash position, these options will
be expensive and the availability of funding will need more investigation.

It will be vital therefore that each option be thoroughly evaluated before any action is taken to
develop and implement the strategy.

This will need both financial and non‐financial analysis and by the end of this process, the Board
will need to decide on a shortlist of options that will be carried forward to the strategic
implementation stage.

64 KAPLAN PUBLISHING