*** P3 December 2012 Exam *** Instant Poll and comments***

Comments from last papers stated that any model if connected with scenario will be given a credit. But just my subjective opinion: as examiner gave possiibility to check market growth and relative market share – exactly for BCG grid – it was easiest for gaining marks. Ashridge – well I think second best – but its more about HQ fit ans ability to support SBUs not other way around – but for sure will score marks (I think proffesional marks was for applying any model and connecting with scenario). Need to wait for Feb 🙂

im really not getting how ashridge applied to q1? how did you tie it to the benefits each co had?

i used bcg and tows. whether it was ‘right’ or not, i managed a convincing argument, made points about synergies between the co’s and how the group could use these in the future

@carl29 said:
im really not getting how ashridge applied to q1? how did you tie it to the benefits each co had?

i used bcg and tows. whether it was ‘right’ or not, i managed a convincing argument, made points about synergies between the co’s and how the group could use these in the future

Remember the axes of the Model benefits and feel so one would be heratland the first one cant remember the name and then apply accordingly. Thats just my opinion!

@bmparadzi said:
Remember the axes of the Model benefits and feel so one would be heratland the first one cant remember the name and then apply accordingly. Thats just my opinion!

i know the model. its just i thought it was used to asess the benefits parents can provide sbus, where the q asked for the benefits the sbus could provide the parent?

isnt ashridge more for potential acquisitions? not for existing sbus? im not sure how you could have linked the benefits using that model? eg, the contacts that the first co had could be used by number 3? how did ashridge identify that?

i didn’t use BCG for qs one.. purely just performance, i.e Strengths and Weaknesses, with the financial ratios and then how they can or can’t contribute to the Parent company in the future- help! would i still get some marks??

25 marks

Q1 (a) I analysed performance through ratios, such as revenue growth, gross margin and net margin. I also used BCG to state that POTS was a cash cow, Glass was a dog and the third company was a star.
I also stated that the cash cow can be used to support further acquisitions and the existing companies through financing and expertise, the second company provided an essential product for POTS production so should not be divested (even though it is a dog) but should be nurtured. I said the third company should build on their innovative practices and offer further unique products to additional public sector customers. I also said the third company allowed an entry into the private sector market for the EA Group, especially POTS as they have, until then, been primarily public sector orientated.

(b) Contextual factors for change: Time – the contract was exclusive for 10 years, so any change forced on the company may need to wait. Scope – I said the company was basically a one-department company (the IT dept) so any change will impact on the entire business. Capability – I talked about conflicts between staff, manager, unions etc, so they would be used to managing change and conflicts and would have this capability going forward. Readiness – I talked about the backlog of applications to develop and the fact that they would still be dealing with change from the outsourcing so would not be ready for strategic change right now.
(c) I talked about advantages – easy way to measure performance, can measure how close/far from competitors, cheap. disadvantages – difficulty to get like-for-like data (i.e. how do the various councils measure customer satisfaction) and it doesn’t tell you why performance is good/far (specifically the number of user faults had gone down but what this due to less faults or users more reluctant to reports faults).

Q2 (a) I talked about the various stakeholders, their expectations and power v interest (mendelow). I also did PESTEL (focussing on political – the reduction in govt grants, legal – employment law and landlord law, environmental – the changing weather was increasing maintenance costs, technological – they need to be aware of developments such as the internet, etc).
(b) I gave various improvements such as: forecast weather, profile volunteers, online communities/forums, provide rules and regulations re roaming on farmlands and dogs, allow visitors to book events in advance on the website, I also gave a few others which I can’t remember.

Q3 (a) I talked about advantages v disadvantages of franchising and linked to the scenario, such as increased visibility for the brand as this was something they had failed to do so far, and that Emile wasn’t good at people management, but franchising would pass HR to franchisees whilst allowing Emile to focus on strategy. However, there may be a lack of goal congruence, franchisees may harm the brand, may create a future competitor when the patent expires, etc.

(b) I just talked about the advantages and disadvantages of strategic alliances, joint ventures, etc. I forgot about licensing though!

(c) I talked about the low cash balance, too must cash tied up in receivables. However, they were lowly geared and had high interest cover so debt could be an option. I also said equity wasn’t suitable as Emile wanted to retain full control of the company.

Hopefully I wrote enough specific points to pass.

Q1.a. Didn’t apply a specific model to it, I dicussed the financial and non financial performance of each (applying opps and threats to each) I then summaries the potential to each but only called out the that one was a cash cow – don’t know if I picked up enough relevant marks.
Q1.b. Didn’t specifically call out the culture web but analysed the impact that each would have on the business and future changes
Q1.c. Benchmarking – just applied adv and dis to differnt types can’t even remember if I referred them back to the case study 🙁
Q2.a. PESTEL and applied each
Q2.b. Gave references to stakholders opinions and improvements etc.
Q3.a.Franchising adv and disadv
Q3.b. Waffled through this one. didn’t know the answer.
Q3.c. Liquidity and GP margins etc. didn’t agree with the 500K claw back.

Don’t know if I did enough to be honest. I have a gut feeling I didn’t. My answers weren’t as specific as I would have liked. Think I waffled my way through much of the paper. Don’t know!!! I’ll just have to wait and see now!

I applied a SWOT analysis to Q1 using financial ratios. I think this will score marks as it gives a current position in Strengths and Weaknesses and also outlines future performance in the portfolio using Opportunities and Threats.

Thoughts?

I only considered BCG half way through my answer and deemed it too late to change!!!

@royyston said:

1b) Contextual features of change – Kaleidoscope of change by Balogun and Hope Hailey. Reference is made to the case study regarding time, scope, readiness and capacity.
.

Yay, I didn’t write whose theory that was, but answered correctly, I guess. 🙂

Regarding Ashridge, it’s specifically designed to look at the value that parents can add to business units, not the other way around as the question was asking, so I didn’t apply it. I maybe inadvertantly discussed it by talking about how the parent can sustain company 2 (who was close to liquidation), open up new markets (public sector) to company 3 (who were primarily private sector), but I didn’t think there was enough and found BCG far more appropriate. Hope I was right.

I didn`t consider Glass to be a cash dog… it was growing in a growing market, so it was rather a star…. but i don`t remember exactly so i guess there were some arguments.

I answered the first question using BCG and Ashridge. First was to assess the performance and second to assess the fit between of the companies within the Group…

I am interested if any of you have considered Glass as a Dog

EDIT Now i remember, Glass was growing in a stable/slightly declining market. This sounded more like a cash cow or something…