Final exam suggestions

 Time: 3 Hours                                                                                                 Total Marks: 50

Part A:1.      Write any Ten short notes on the following: 1 × 10 = 10

1. Business Strategies,

2. Good strategies,

3. Strategy evaluation,

4. Functional Strategies,

5. Strategy formulation,

6. Strategy implementation,

7. Intended strategy,

8. Emergent strategy,

9. Strategic Management,

10. Stakeholders,

11. Segments of the external environment.

12. Decentralized federation

13. coordinated federation model

14. centralized hub model.

 Part B:            Answer any Four of the following questions:                                5 × 4 = 20

2.      Discuss Deming’s 14 points of quality.

3.      Explain the concept of “the value chain” given by Michael E Porter.

4.      What are the strategic principles of Marks and Spencer that help in achieving competitive advantage in British retailing. 

5.      How can superior efficiency result in low cost?. 

6.     How can change of life - style influence strategy formulation of your business?

7.     What are the theoretical frameworks and empirical evidence supporting the various explanations for corporate internationalization?

Part C:                       Answer Two of the following questions:                      10 × 2 = 20

7.  Discuss the common areas of the internal environment that indicate strengths and weaknesses of your company.

8. What is differentiation strategy, and how can companies effectively implement it to achieve a competitive advantage?

9. What are the most effective strategies employed by multinational corporations to leverage their global presence for competitive advantage and increased profitability?

10.  Case to solve: Marks & Spencer (M&S) is a British retailing institution. Founded in 1884 by Michael Marks, a Polish Jew who had emigrated to England, the company has been a national chain since the early 1900s. By 1926 the company had a branch in every major town in the country and had become Britain's largest retailer, a position it still holds in 1994. Primarily a supplier of clothing and foodstuffs, M&S is one of the world's most profitable retailers. In 1992 M&S's 280 United Kingdom stores had sales of $7.5 billion. M&S accounted for 15 percent of all retail clothing sales in the United Kingdom, and 4.6 percent of all food sales. According to the Guinness Book of Records. in 1991 the company's flagship store at Marble Arch in London had a turnover of $3,700 per square foot-more than any other department store in the world.

The secret of the company's success lies in the way it follows some key strategic principles, many of which were already well established by the 1920s. M&S provides a selective range of clothing and food items aimed at rapid turnover. The firm sells all its products under its own St. Michael label. M&S offers high quality products at moderate rather than low prices. This combination of high quality and reasonable price encourages customers to associate M&S with value for money, and the firm's ability to deliver this combination consistently over the years has built up enormous customer goodwill in Britain. So strong is M&S's reputation among British con- sumers that the company does no advertising in that market a major source of cost saving.

To achieve the combination of moderate prices and high quality, M&S works very closely with its suppliers, many of whom have been selling a major portion of their output to M&S for generations. The focus on quality is reinforced by M&S's practice of having its technical people work closely with suppli- ers on product design. Suppliers are more than will- ing to respond to the firm's demands, for they know that M&S is loyal to its suppliers and as it grows so do they. The sales volume generated by M&S's strar- egy of providing only a selective range of clothing and food enables M&S's suppliers to realize substan- tial economies of scale from large production runs. These cost savings are then passed on to M&S in the form of lower prices. In turn, M&S passes on part of the savings to the consumer.

Crucial to M&S's effectiveness is a clear focus on the customer. The tone is set by top management. Each senior manager makes a habit of wearing M&S clothes and eating M&S food. Thus managers develop an understanding of what it is that cus- tomers want and like about M&S products; by stay- ing close to the customer they can improve the quality and design of the products they offer. The customer focus is reinforced at the store level by store managers who monitor sales volume and quickly identify lines that are selling and those that are not. Then store managers can transmit this infor- mation to suppliers, which have the capacity to quickly modify their production, increasing the out- put of lines that are selling well and reducing the output of lines that are not moving.

Another central feature of M&S is its pioneering approach to human relations. Long before it became fashionable to do so, M&S had developed a commit- ment to the well-being of its employees. M&S has always viewed itself as a family business with a broad responsibility for the welfare of its employees. M&S

offers employees medical and pension plans that pro- vide benefits that are well-above the industry average. The company pays its cinployees at a rate that is well above the industry average, and it makes a practice of promoting employees from within, rather than hir- ing from outside. Furthermore, there are a series of in-store amenities for employees, including subsi- dized cafetérias, medical services, recreation rooms and hairdressing salons. The reward for M&S is the trust and loyalty of its employees and, ultimately, high employee productivity.

Also vital is the company's commitment to simpli- fying its operating structure and strategic control systems. M&S has a very flat hierarchy; there is lit- tle in the way of intervening management layers between store managers and top management. The firm utilizes just two profit margins, one for food- stuff and one for clothing. This practice reduces bureaucracy and frees its store managers from wor- rying about pricing issues. Instead, they are encour- aged to focus on maximizing sales volume. A store's performance is assessed by its sales volume. Control is achieved partly through formal budgetary proce- dures, and partly through an informal probing process, in which top management drops in unar nounced at stores and quizzes managers there about the store. In a typical year, just about every store in Britain will receive at least one unannounced visit from top management. This keeps store managers on their toes and constantly alert to the need to provide the kind of value-for-money products that customers have come to associate with M&S.'

Discussion Questions

1. What do you think is the source of Marks & Spencer's competitive advantage?

2. Marks & Spencer has managed to maintain its. competitive advantage in British retailing for over fifty years. Why, do you think, have rival firms found Marks & Spencer's competitive position so difficult to attack?