BST - ICAEW EXAM QUESTIONS AND 100% CORRECT
ANSWERS
Strategy - Answer The direction and scope of an organisation over the long term which
achieves advantage for the organisation
The rational approach - Answer Traditional, formal, top down
Benefits of strategic planning - Answer - Provides a framework
- Encourages LT planning
- Goal congruence
- Considers the needs of stakeholders
- Optimised use of resources
- Considers changes in business environment
- Monitors progress
Disadvantages if strategic planning - Answer -Lacks evidence to prove it leads to
success
Businesses may need to be more dynamic and react to problems as they occur
Formal planning reduces initiative and innovate thinking
Political infighting can disrupt the process
Emergent strategy - Answer Behaviours which are aspirated and which have a strategic
impact. Emerge over time in response to the environment. Tried and developed as
implemented
Mintzberg's different grades of strategy
,Answer
Intended - conscious
Deliberate - put into practice
Realised - resultant
Who/ what business would benefit from emergent strategies
Answer
Operate in dynamic environments and require quick decision making
- Have flexible, decentralised organisational structures
What is resource-based strategic advantage? Inside out: focus on developing internal
resources and competencies, which are hard to imitate. Then find or create markets
that exploit these strengths.
What is a positioning-based strategic advantage? Outside in: focus on analyzing the
external environment to identify customer needs, and adapt to meet those needs.
What's the risk with a resource based strategic advantage. Answer Organisation may
fail to react to long term industry trends
What's the risk of a positioning based strategic advantage. Answer Customers needs
changed so organisation is forced to constantly evolve
What 5 things would influence planning horizons. Answer - Nature of ownership
- Capital structure
- Nature of industry
- Business environment
- Nature of management
,Benefits of sustainability - Answer - Attracting customers who are committed to
sustainable practice
Attracting and retaining skilled staff
Building positive relationships with like-minded suppliers
Demonstrating to shareholders an ability to deliver reliable returns
What does ESG stand for - Answer Environmental, Social, Governance
What is a mission - Answer The most generalised type of objective which can be thought
of an a reason for existence
What are the 4 elements of a successful mission statement Ashridge College Model -
Answer Purpose, Strategy, Policies, Values
Advantages of mission statements - Answer - Help resolve stakeholder conflict.
- Set the direction of the organisation and so help formulate strategy.
- Help communicate the values and direction of organisation to stakeholders.
Criticisms of mission statements - Answer - Often full of meaningless terms like 'the
best', which give staff little idea of what to aim at. - Often ignored by managers.
- Often considered to just be a public relations exercise.
Primary objective of profit making business - Answer Maximise shareholder wealth
Primary objective for not for profit entities - Answer Maximise the benefit to target
stakeholder
Secondary goals for for profit organisations - Answer - Customer satisfaction
- Social responsibility
, - Innovation
- Significant employment
Secondary goals of not for profit organisations - Answer - Investing in personnel
- Minimum local environmental impact
- Economy, efficiency, effectiveness
Mendlow's stakeholder mapping - Answer Low interest, low power = Minimal effort
Low interest, high power = Keep satisfied
High interest, low power = Keep informed
High interest, high power = Key players
PESTLE stands for _______
Answer Political, Economic, Social, Technological, Legal, Environmental
What is scenario planning _______
Answer Concerns the development of pictures of potential futures for the purpose of
managerial learning and the development of strategic responses
What are the 4 elements of porters diamond and what do they contribute to _______
Answer Demand conditions, Rivalry, Related industry, factor conditions
Contribute to __________ Competitive advantage
What are factor conditions- Answer Availability of factors of production(resources
needed to operate)
What are demand conditions - Answer Demanding local consumers force firms to
become more innovative. Trend setting local consumers help local producers to
anticipate future global trends.
ANSWERS
Strategy - Answer The direction and scope of an organisation over the long term which
achieves advantage for the organisation
The rational approach - Answer Traditional, formal, top down
Benefits of strategic planning - Answer - Provides a framework
- Encourages LT planning
- Goal congruence
- Considers the needs of stakeholders
- Optimised use of resources
- Considers changes in business environment
- Monitors progress
Disadvantages if strategic planning - Answer -Lacks evidence to prove it leads to
success
Businesses may need to be more dynamic and react to problems as they occur
Formal planning reduces initiative and innovate thinking
Political infighting can disrupt the process
Emergent strategy - Answer Behaviours which are aspirated and which have a strategic
impact. Emerge over time in response to the environment. Tried and developed as
implemented
Mintzberg's different grades of strategy
,Answer
Intended - conscious
Deliberate - put into practice
Realised - resultant
Who/ what business would benefit from emergent strategies
Answer
Operate in dynamic environments and require quick decision making
- Have flexible, decentralised organisational structures
What is resource-based strategic advantage? Inside out: focus on developing internal
resources and competencies, which are hard to imitate. Then find or create markets
that exploit these strengths.
What is a positioning-based strategic advantage? Outside in: focus on analyzing the
external environment to identify customer needs, and adapt to meet those needs.
What's the risk with a resource based strategic advantage. Answer Organisation may
fail to react to long term industry trends
What's the risk of a positioning based strategic advantage. Answer Customers needs
changed so organisation is forced to constantly evolve
What 5 things would influence planning horizons. Answer - Nature of ownership
- Capital structure
- Nature of industry
- Business environment
- Nature of management
,Benefits of sustainability - Answer - Attracting customers who are committed to
sustainable practice
Attracting and retaining skilled staff
Building positive relationships with like-minded suppliers
Demonstrating to shareholders an ability to deliver reliable returns
What does ESG stand for - Answer Environmental, Social, Governance
What is a mission - Answer The most generalised type of objective which can be thought
of an a reason for existence
What are the 4 elements of a successful mission statement Ashridge College Model -
Answer Purpose, Strategy, Policies, Values
Advantages of mission statements - Answer - Help resolve stakeholder conflict.
- Set the direction of the organisation and so help formulate strategy.
- Help communicate the values and direction of organisation to stakeholders.
Criticisms of mission statements - Answer - Often full of meaningless terms like 'the
best', which give staff little idea of what to aim at. - Often ignored by managers.
- Often considered to just be a public relations exercise.
Primary objective of profit making business - Answer Maximise shareholder wealth
Primary objective for not for profit entities - Answer Maximise the benefit to target
stakeholder
Secondary goals for for profit organisations - Answer - Customer satisfaction
- Social responsibility
, - Innovation
- Significant employment
Secondary goals of not for profit organisations - Answer - Investing in personnel
- Minimum local environmental impact
- Economy, efficiency, effectiveness
Mendlow's stakeholder mapping - Answer Low interest, low power = Minimal effort
Low interest, high power = Keep satisfied
High interest, low power = Keep informed
High interest, high power = Key players
PESTLE stands for _______
Answer Political, Economic, Social, Technological, Legal, Environmental
What is scenario planning _______
Answer Concerns the development of pictures of potential futures for the purpose of
managerial learning and the development of strategic responses
What are the 4 elements of porters diamond and what do they contribute to _______
Answer Demand conditions, Rivalry, Related industry, factor conditions
Contribute to __________ Competitive advantage
What are factor conditions- Answer Availability of factors of production(resources
needed to operate)
What are demand conditions - Answer Demanding local consumers force firms to
become more innovative. Trend setting local consumers help local producers to
anticipate future global trends.
