SOUTHERN UNIVERSITY COLLEGE

SEMESTER C

YEAR 2020 / 2021

FINAL EXAM

BBMN 3413 STRATEGIC MANAGEMENT

DATE: 18/1/2021, 8 AM SUBMISSION: 19/1/2021, 8 AM

BACHELOR OF MARKETING
BACHELOR OF BUSINESS ADMINISTRATION (HONS)
BACHELOR BBA (HONS) OF FINANCE & INVESSTMENT
BACHELOR OF HUMAN RESOURCE MANAGEMENT
BACHELOR OF ACCOUNTING (HONS)

YEAR THREE

Student’s Name : SEOW YEE JUH

Instruction to Candidates:

There are FOUR questions in this paper. Answer ALL questions.

Standard format: Times New Roman (12pt), 1.5 spacing, 1” margin, A4,
You are required to use this page as your cover page for your answer script.
Name your document with the following file name for submission: -
For example: BAC_LIM AH KIEW_B200035A_SM_EXAM
Submit your answer in PDF file to e-learning.
State your STU ID_ NAME at the top of each page.
Answer should be not more than 7 pages.
Deadline for submission of this assignment is to be strictly adhered to. Late submission will
NOT be accepted and be awarded ZERO (0) mark for the assignment.
Any students that are caught plagiarizing or letting part or whole of their work to be
plagiarized will be penalized, with all the students involved be awarded ZERO (0) mark for
the assignment.

QUESTION NO Q1 Q2 Q3 Q4 TOTAL

Marks obtained
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Question 1(a)
Business level strategy is an integrated and coordinated the organisation's commitments and
actions to gain competitive advantage by using the core competitiveness of a specific product
market. The core competitiveness of the organisation should be focused on satisfying
customer needs or preferences in order to achieve above average returns. Business level
strategies detail actions taken to provide value to customers and gain a competitive advantage
by exploiting core competencies in specific, individual product or service markets. It is
concerned with a firm's position in an industry relative to competitors.

There are 3 types of business level strategy which are cost leadership strategy, differentiation
strategy and focus strategy. Cost leadership strategy is the action taken to produce goods or
services at the lower cost relative to competitors in the market. This can include minimize the
cost of sales, Research & Development, and service. For example, McDonald’s implemented
division of labour by employing and training inexperienced employees instead of skilled
chefs and thus manages to cut huge amounts of costs from the salaries of its employees.
Differentiation strategy is the action taken by offering a unique product or service that are
valued by the customers. Value is provided to customers by the unique features and
characteristics of the products rather than by the lowest price. For example, a candy
organisation may differentiate their candy by improving the taste or using healthier
ingredients even though its competitors have cheaper candy. Focus strategy is the action
taken by offering products or services to a niche group of customers in the market. If an
organisation apply focus strategy, they just concentrate on a narrow market such as particular
group of customers or geographic markets. For example, Coca-Cola Company has introduced
“Diet Coke” to serve the niche market composed of diabetic patients.

Question 1(b)
The four components of BCG matrix are star, question mark, cash cow and dog. Stars
operate in a high growth rate industry and maintain high market share. Stars are both cash
generators and cash users. Since stars are expected to become cash cows and generate
positive cash flows, they are the primary units in which the company should invest its money.
However, not all stars become cash flows. This is especially true in fast changing industries
where new innovative products will soon be surpassed by new technological advances.
Therefore, a star becomes a dog rather than becoming a cash cow. Question marks are the
brands which need much closer consideration. It has a high cash use but a low cash
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generation. They retain low market share in rapidly rising markets investing vast sums of
cash and incurring losses. It has potential to gain market share and become a star which
would later become cash cow. It does not always succeed and even after a substantial amount
of investment, they struggle to gain market share and eventually become dogs. Therefore,
they require very close consideration to determine whether they are worth investing in or not.
Cash cows have a low cash use and a high cash generation. The growth rate of cash cows is
low which can translate into a slow growth rate. However, the market share is high which
leads to a large amount of cash generation. The cash cows should keep the investment as low
as possible to maintain market share. In order to fund their further growth, the cash obtained
from “cow” should be invested in stars. They should not invest in cash cows to stimulate
growth but only to support them to retain their current market share. In general, cash cows are
big companies that are able to create new innovative products or processes which can become
new stars. If there is no supporting from cash cows, they would not be capable of such
innovations. Dogs have a low cash use and a low cash generation. Compared to competitors,
it holds a limited market share and operates in a slowly growing market. In general, they are
not worth investing in since they generate low or negative cash returns. However, for long
period of time, some dogs may be profitable. They may provide synergies or act simply as a
defense against moves by competitors for other brands. Therefore, it is always necessary to
undertake deeper analysis of each brand to ensure that
they are not worth investing in or have to be divested.

There are some limitation of analysis using BCG

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cows to businesses if it helps to achieve competitive advantage for the rest of the
organisation.
Question 2(a)
The hard elements of Mc Kinsey 7s model are Strategy, Structure, and Systems while the
soft elements of Mc Kinsey 7s model are Shared values, Skills, Style, and Staff.

Question 2(b)
The Mc Kinsey 7s model consists of seven elements of an organisation, three "hard"
(strategy, structure and systems) and four "soft" (shared values, skills, style and staff), all of
which are interrelated. The model is usually visualized as a network with shared value at the
center. Placing shared values in the middle of the model emphasizes that these values are
essential to the development of all other key elements. This shows that shared values has a
significant impact on the other six elements. The other elements originate from the very
reason for the existence of the organisation which is the original vision was formed from the
values of the creators in an organisation. The interdependence of the strategy development
framework means that if one element changes, you will have to address the other six elements
to analyze how that change affects them and determine how each change may need to be
adjusted to keep the organisation's goals consistency.

Strategy is a plan for the organisation to achieve established goals and to develop long-term
advantages. It is maintaining a competitive advantage over the competitors. Competitive
advantage is derived from meeting customer expectations. The organisation examines
whether the strategy is appropriate and the organisation is competitive in terms of meeting
those expectations. For example, a short-term strategy is usually a poor choice for an
organisation but if it is combined with the other six elements, it may provide excellent results.
Structure is the organisational hierarchy including reporting arrangements. The structure
reflects the reporting and accountability relationships within the organisation. The structure
must support the strategy. For example, SmartPixel is organized into three core teams which
are Game Design, Artistic Development and Programming. Each of these teams has its own
team managers who report to an overall Producer team. System refers to the processes and
procedures in which staff members participate to get the job done such as information
systems, budgeting and control processes. It also refers to the routines and procedures
activities which is necessary to carry out the operations of the organisation. For example, in

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order to create an overall game pitch, the Game Design team pitches suggestions to the
Artistic Development and Programming teams.

Staff describes the organisation’s employees and their general capabilities. The employees
and their capabilities generate advantages for the organisation. This will involve topics such
as demographics and diversity and thus whether the organisation draws from the largest
potential pool of talent. A talent pool and qualitatively superior abilities are the intangible
assets that policy rides on. For example, managers are encouraged to build a sense of
camaraderie in their teams through motivational activities. Style describes the style of
leadership in the organisation. For example, during the concept creation and testing phases of
the games, SmartPixel allows for feedback from all teams and the feedback is anonymized in
order to ensure that the freedom of expression. Skills refer to the actual skills and
competencies of the organisation's employees.
This element takes into account the existing skills and abilities of employees and their
development methods. For example, SmartPixel encourages to hire artists with widely
different styles in order to diversify idea generation and promote the ability of the
programming team. Shared values are the core values of the organisation as shown in its
corporate culture and ethics of general work. The shared value are likely to be connected to
the firm's mission or the founders' vision or an appreciation of why the organisation operates.
For example, to ensure that SmartPixel employees are able to work in a manner that suits
them best, the culture of flexible working hours are implemented.

Question 3(a)
There are some benefits of using corporate governance in strategic management. First, good
corporate governance ensures corporate success and economic growth. Organisations
that are responsible for these different elements of corporate governance will definitely
outperform than others. They will be able to attract more investors which will help the
organisation's further financial growth. Besides, it maintains investors’ confidence as a
result of which company can raise capital efficiently and effectively. When evaluating an
organisation for investment, investors believe that corporate governance is important as
financial performance. Investors who provided with high levels of disclosure and
transparency are likely to make investments in such organisations. Furthermore, it lowers the
capital cost. Implementation of good governance practices will lead to a reduction in the cost
of capital of a business in today's volatile climate. An organisation that is considered to be
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stable, efficient and capable of managing potential risks will borrow funds at a lower rate
than those with poor corporate governance. Moreover, there is a positive impact on the
share price. In addition, it provides proper inducement to the owners as well as
managers to achieve objectives that are in interests of the shareholders and the
organisation. Apart from that, it also minimizes wastages, corruption, risks and
mismanagement. The Board of an organisation is made aware of the majority of the mask
risks involved in a specific plan by a transparent and accountable system, thereby putting in
place different control mechanisms to enable monitoring of the relevant issues. Besides that,
it helps in brand formation and development. The core task of the formation of a brand
and the development is to create an unambiguous and sustainable positioning for the brand
with which past performances are transformed into a sustainable commitment. Last but not
least, it ensures organisation in managed in a manner that fits the best interests of all.
The interests of customers, employees, shareholders, suppliers, and etc. must be secured by
the Board of Directors. This is only possible when corporate governance is used.

Question 3(b)
Corporate strategy is developed by an executive, beginning by evaluating the industry or
environmental circumstances under which they operate. They built a distinctive strategic
position such as cost leadership strategy to outperform their competitors by developing a
competitive advantage. Therefore, the organisation aligns its value chain accordingly.
Organisations need to follow an internally consistent set of practices that go beyond the
organisational framework to effectively carry out the proposed strategy which include: (1)
strategic planning process, (2) recruitment and training, (3) reward systems for employees
and managers, and (4) work to be undertaken, information systems and processes. However,
strategic fit could not be completely resolved by taking into account only the policy and
organisational structure. Revisiting the strategy itself might also be necessary while the
implementation process is formally under consideration.

Question 4(a)
Haris should delegate authority but not responsibilities. This is because as a manager, Haris
may implement the tasks or problems to the employees according to their departments such
as endorsement task to that department employees, commission tasks to the employees who
are approved for it. Although the employees are responsible for the goals and objectives,

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Haris is still solely responsible for the success of the assigned task. Therefore, it is his
responsibility to delegate authority to the employees.

Question 4(b)
The leadership style that Haris should demonstrates is delegate. It is important to note that it
is a symbol of strength, not a weakness, to trust your team with your idea. Delegating tasks to
the appropriate departments is one of the most important skills Haris can develop as the
business grows. Furthermore, Haris should demonstrates positivity. A leader should create a
positive environment within the organisation. He needs to be open-minded. Nevertheless,
Harris thinks that the employees are not proud of their work or concern for the company. In
addition, Haris should demonstrates innovative skill. A leader must be innovative and
focused on the strategies for the improvement of the organisation. However, Haris was busy
finishing all the jobs and therefore he could not handle his duties as a manager. Moreover,
Haris should demonstrates trust on employees. A leader should always trust his employees.
This in turn increase the morale and confidence of employees which leads to their effective
performance. Besides, Haris should demonstrates motivation skill. A leader should
understand the need of employees and motivate them. However, Haris do not motivate his
employees.

Question 4(c)
The appropriate control mechanism that is suitable for improvement is feedback control. It is
also known as post-action or output control. It concentrates on the outputs of the organisation
after transformation is complete. It is often used when feedforward and concurrent control are
not feasible or the cost is too high. Sometimes, feedback is the only viable type of control
available. Feedback control has two advantages which (1) it provides managers with
meaningful information on how effective the planning effort was, and (2) it will increase the
motivation of employees. If feedback shows little difference between usual and actual
performance, this is evidence that planning was normally on target. If the deviation is high
when formulating new plans to make them more successful, a manager may use this
information. However, the damage is already done if there is a significant problem. For
example, when customer service department received complaints about the poor services
provided by the customer service offices, the manager will investigate the cause and draw
new service management strategy to ensure quality of customer service in the future.

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