Page 163 - BA1 Integrated Workbook STUDENT 2018

Answers to supplementary objective test

questions

CHAPTER 1 – THE PROCESS OF STRATEGY FORMULATION

1.1 C, D

Both C and D look at issues that PPR faces when trying to compete in individual
markets.

A and E are both corporate level decisions as they focus on strategies that
affect the organization as a whole, or the entry into/exit from PPR’s markets.

B is likely to be operational in nature as it relates to the day to day management
of one of PPR’s divisions.

1.2 A

GG is in an industry that is moving very slowly, meaning that they have time to
undertake the detailed analysis required by the rational model. This detailed
analysis is also likely to be particularly important for GG as they have relatively
inexperienced managers who will benefit from a detailed understanding of the
industry.

1.3 A, C, D

Each of these options are problems with freewheeling opportunism. Note that
the other two options are reasons why a company may undertake freewheeling
opportunism.

1.4 C

A diverse board will be more likely to come up with new strategic ideas as they
are from a number of different backgrounds.

The fact that the majority of directors are now friends with the CEO will make it
easier for him to implement inappropriate strategies as he will be under less
scrutiny (especially given the lack of NEDs).

There is no obvious reason why the diverse board would ensure better
management information.

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