Strategic Management Model Test Paper - 1 (Questions) - CA Intermediate PDF Download

 Page 1


MODEL TEST PAPER 1 
 PAPER 6B: STRATEGIC MANAGEMENT 
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises case scenario based multiple choice questions (MCQs)
3. Part II comprises questions which require descriptive type answers.
PART I – Case scenario based MCQs (15 Marks) 
Question 1.(A) (Compulsory) 
1. (A)  In the fiercely competitive automotive industry, Zing, a promising
newcomer, set out on a strategic journey with ambitions of making a 
substantial impact. Recognizing the significance of a robust distribution 
network early on, Zing forged partnerships with established dealerships, 
offering them attractive margins. This strategic move significantly 
enhanced Zing's reach, with a presence in 80% of the nation's 
dealerships by 2022, expanding its coverage significantly. 
To differentiate themselves from competitors, Zing adopted two key 
strategies. Firstly, they prioritized product design, investing heavily in 
aesthetics and incorporating innovative features and environmentally 
friendly technologies. This focus on design led to their vehicles receiving 
excellent reviews and achieving an impressive 15% year-on-year growth 
in sales. 
Secondly, Zing implemented switching costs to discourage customers 
from switching to other brands. Their vehicles featured branded 
software, making it both expensive and cumbersome for customers to 
transition to alternative brands. This strategic move effectively protected 
Zing's market share. 
Zing's overarching goal was to position itself as a premium automotive 
brand, blending luxury with sustainability. However, their execution fell 
down as they challenged with maintaining consistent quality and service 
levels, resulting in mixed customer reviews. 
Despite their best efforts, Zing's differentiation strategy fell short due to 
issues with inconsistent quality and service. Negative word-of-mouth and 
declining customer satisfaction scores tarnished their brand image, 
leading to stagnating sales. This failure to deliver on their brand promise 
proved to be a significant setback. 
As Zing's reputation suffered from execution failures, securing additional 
funds for international expansion became challenging. Consequently, 
they made the difficult decision to postpone their global ambitions for the 
next five years, focusing instead on stabilizing their finances and 
rebuilding their brand image. 
In summary, Zing's strategic journey illustrates the importance of not 
only crafting a compelling differentiation strategy but also executing it 
236
Page 2


MODEL TEST PAPER 1 
 PAPER 6B: STRATEGIC MANAGEMENT 
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises case scenario based multiple choice questions (MCQs)
3. Part II comprises questions which require descriptive type answers.
PART I – Case scenario based MCQs (15 Marks) 
Question 1.(A) (Compulsory) 
1. (A)  In the fiercely competitive automotive industry, Zing, a promising
newcomer, set out on a strategic journey with ambitions of making a 
substantial impact. Recognizing the significance of a robust distribution 
network early on, Zing forged partnerships with established dealerships, 
offering them attractive margins. This strategic move significantly 
enhanced Zing's reach, with a presence in 80% of the nation's 
dealerships by 2022, expanding its coverage significantly. 
To differentiate themselves from competitors, Zing adopted two key 
strategies. Firstly, they prioritized product design, investing heavily in 
aesthetics and incorporating innovative features and environmentally 
friendly technologies. This focus on design led to their vehicles receiving 
excellent reviews and achieving an impressive 15% year-on-year growth 
in sales. 
Secondly, Zing implemented switching costs to discourage customers 
from switching to other brands. Their vehicles featured branded 
software, making it both expensive and cumbersome for customers to 
transition to alternative brands. This strategic move effectively protected 
Zing's market share. 
Zing's overarching goal was to position itself as a premium automotive 
brand, blending luxury with sustainability. However, their execution fell 
down as they challenged with maintaining consistent quality and service 
levels, resulting in mixed customer reviews. 
Despite their best efforts, Zing's differentiation strategy fell short due to 
issues with inconsistent quality and service. Negative word-of-mouth and 
declining customer satisfaction scores tarnished their brand image, 
leading to stagnating sales. This failure to deliver on their brand promise 
proved to be a significant setback. 
As Zing's reputation suffered from execution failures, securing additional 
funds for international expansion became challenging. Consequently, 
they made the difficult decision to postpone their global ambitions for the 
next five years, focusing instead on stabilizing their finances and 
rebuilding their brand image. 
In summary, Zing's strategic journey illustrates the importance of not 
only crafting a compelling differentiation strategy but also executing it 
236
flawlessly. In the competitive automotive landscape, maintaining 
consistent quality and service is paramount to sustaining brand loyalty 
and achieving long-term success. 
Based on the above Case Scenario, answer the Multiple Choice 
Questions. 
(i) What key strategic approach did Zing use to expand its market
presence in the automotive industry?
(a) Product innovation and design
(b) Cost leadership strategy
(c) Entering new international markets
(d) Vertical integration (2 Marks) 
(ii) How did Zing protect its market share from potential competitors?
(a) Price-cutting strategy
(b) Branded software and switching costs
(c) Aggressive marketing campaigns
(d) International expansion (2 Marks) 
(iii) Why did Zing's differentiation strategy fall short in the market?
(a) Intense price competition
(b) Poor marketing strategy
(c) Inconsistent quality and service
(d) Lack of international expansion (2 Marks) 
(iv) Forging partnerships with established dealerships to enhance its
distribution network falls under which level of strategy?
(a) Corporate level strategy
(b) Business level strategy
(c) Functional level strategy
(d) Competitive level strategy (2 Marks) 
(v) How did Zing initially expand its market presence across the
nation?
(a) Aggressive marketing campaigns
(b) Developing low-cost vehicles
(c) Partnering with established dealerships
(d) Launching a luxury brand (2 Marks) 
(B) Compulsory Application Based Independent MCQs
(i) TechMex Inc., a leading technology company, offers a diverse
portfolio of products ranging from established cash cows to
237
Page 3


MODEL TEST PAPER 1 
 PAPER 6B: STRATEGIC MANAGEMENT 
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises case scenario based multiple choice questions (MCQs)
3. Part II comprises questions which require descriptive type answers.
PART I – Case scenario based MCQs (15 Marks) 
Question 1.(A) (Compulsory) 
1. (A)  In the fiercely competitive automotive industry, Zing, a promising
newcomer, set out on a strategic journey with ambitions of making a 
substantial impact. Recognizing the significance of a robust distribution 
network early on, Zing forged partnerships with established dealerships, 
offering them attractive margins. This strategic move significantly 
enhanced Zing's reach, with a presence in 80% of the nation's 
dealerships by 2022, expanding its coverage significantly. 
To differentiate themselves from competitors, Zing adopted two key 
strategies. Firstly, they prioritized product design, investing heavily in 
aesthetics and incorporating innovative features and environmentally 
friendly technologies. This focus on design led to their vehicles receiving 
excellent reviews and achieving an impressive 15% year-on-year growth 
in sales. 
Secondly, Zing implemented switching costs to discourage customers 
from switching to other brands. Their vehicles featured branded 
software, making it both expensive and cumbersome for customers to 
transition to alternative brands. This strategic move effectively protected 
Zing's market share. 
Zing's overarching goal was to position itself as a premium automotive 
brand, blending luxury with sustainability. However, their execution fell 
down as they challenged with maintaining consistent quality and service 
levels, resulting in mixed customer reviews. 
Despite their best efforts, Zing's differentiation strategy fell short due to 
issues with inconsistent quality and service. Negative word-of-mouth and 
declining customer satisfaction scores tarnished their brand image, 
leading to stagnating sales. This failure to deliver on their brand promise 
proved to be a significant setback. 
As Zing's reputation suffered from execution failures, securing additional 
funds for international expansion became challenging. Consequently, 
they made the difficult decision to postpone their global ambitions for the 
next five years, focusing instead on stabilizing their finances and 
rebuilding their brand image. 
In summary, Zing's strategic journey illustrates the importance of not 
only crafting a compelling differentiation strategy but also executing it 
236
flawlessly. In the competitive automotive landscape, maintaining 
consistent quality and service is paramount to sustaining brand loyalty 
and achieving long-term success. 
Based on the above Case Scenario, answer the Multiple Choice 
Questions. 
(i) What key strategic approach did Zing use to expand its market
presence in the automotive industry?
(a) Product innovation and design
(b) Cost leadership strategy
(c) Entering new international markets
(d) Vertical integration (2 Marks) 
(ii) How did Zing protect its market share from potential competitors?
(a) Price-cutting strategy
(b) Branded software and switching costs
(c) Aggressive marketing campaigns
(d) International expansion (2 Marks) 
(iii) Why did Zing's differentiation strategy fall short in the market?
(a) Intense price competition
(b) Poor marketing strategy
(c) Inconsistent quality and service
(d) Lack of international expansion (2 Marks) 
(iv) Forging partnerships with established dealerships to enhance its
distribution network falls under which level of strategy?
(a) Corporate level strategy
(b) Business level strategy
(c) Functional level strategy
(d) Competitive level strategy (2 Marks) 
(v) How did Zing initially expand its market presence across the
nation?
(a) Aggressive marketing campaigns
(b) Developing low-cost vehicles
(c) Partnering with established dealerships
(d) Launching a luxury brand (2 Marks) 
(B) Compulsory Application Based Independent MCQs
(i) TechMex Inc., a leading technology company, offers a diverse
portfolio of products ranging from established cash cows to
237
promising question marks. As part of its strategic planning process, 
the company aims to assess its product portfolio's performance and 
allocate resources effectively. In which quadrant of the BCG Matrix 
would TechMex's new innovative product, recently launched in a 
rapidly growing market, likely fall into?  
(a) Cash Cow
(b) Dog
(c) Question Mark
(d) Star (2 Marks) 
(ii) BlueSky Enterprises, a multinational corporation specializing in
renewable energy solutions, is undergoing a strategic
transformation to enhance its competitive position in the market. As
part of this initiative, the company is reevaluating its organizational
structure, processes, and culture. Which aspect of the McKinsey
7S Model is most relevant for BlueSky Enterprises during this
strategic transformation?
(a) Strategy
(b) Structure
(c) Systems
(d) Skills (2 Marks) 
(iii) The threat of substitutes is high when:
(a) There are few substitute products available
(b) Switching costs are low
(c) Suppliers have high bargaining power
(d) There is strong brand loyalty (1 Mark) 
PART II – Descriptive Questions (35 Marks) 
Question No. 1 is compulsory. 
Attempt any two questions out of the remaining three questions. 
1. (a)  Swati is the marketing manager at a software company. She is
responsible for developing and implementing marketing strategies for 
the company’s products. Swati leads a team of marketing professionals 
and works closely with the product development and sales teams to 
ensure that the company's products are effectively promoted in the 
market. She also analyzes market trends and customer feedback to 
refine the marketing strategies. Which level is she working at, discuss 
the roles and responsibilities of this level in organization?   (5 Marks) 
(b) ABC Corp, a multinational consumer electronics company, is planning to
expand its operations into a new country. The company's senior
management is evaluating the potential risks and opportunities of
238
Page 4


MODEL TEST PAPER 1 
 PAPER 6B: STRATEGIC MANAGEMENT 
1. The question paper comprises two parts, Part I and Part II.
2. Part I comprises case scenario based multiple choice questions (MCQs)
3. Part II comprises questions which require descriptive type answers.
PART I – Case scenario based MCQs (15 Marks) 
Question 1.(A) (Compulsory) 
1. (A)  In the fiercely competitive automotive industry, Zing, a promising
newcomer, set out on a strategic journey with ambitions of making a 
substantial impact. Recognizing the significance of a robust distribution 
network early on, Zing forged partnerships with established dealerships, 
offering them attractive margins. This strategic move significantly 
enhanced Zing's reach, with a presence in 80% of the nation's 
dealerships by 2022, expanding its coverage significantly. 
To differentiate themselves from competitors, Zing adopted two key 
strategies. Firstly, they prioritized product design, investing heavily in 
aesthetics and incorporating innovative features and environmentally 
friendly technologies. This focus on design led to their vehicles receiving 
excellent reviews and achieving an impressive 15% year-on-year growth 
in sales. 
Secondly, Zing implemented switching costs to discourage customers 
from switching to other brands. Their vehicles featured branded 
software, making it both expensive and cumbersome for customers to 
transition to alternative brands. This strategic move effectively protected 
Zing's market share. 
Zing's overarching goal was to position itself as a premium automotive 
brand, blending luxury with sustainability. However, their execution fell 
down as they challenged with maintaining consistent quality and service 
levels, resulting in mixed customer reviews. 
Despite their best efforts, Zing's differentiation strategy fell short due to 
issues with inconsistent quality and service. Negative word-of-mouth and 
declining customer satisfaction scores tarnished their brand image, 
leading to stagnating sales. This failure to deliver on their brand promise 
proved to be a significant setback. 
As Zing's reputation suffered from execution failures, securing additional 
funds for international expansion became challenging. Consequently, 
they made the difficult decision to postpone their global ambitions for the 
next five years, focusing instead on stabilizing their finances and 
rebuilding their brand image. 
In summary, Zing's strategic journey illustrates the importance of not 
only crafting a compelling differentiation strategy but also executing it 
236
flawlessly. In the competitive automotive landscape, maintaining 
consistent quality and service is paramount to sustaining brand loyalty 
and achieving long-term success. 
Based on the above Case Scenario, answer the Multiple Choice 
Questions. 
(i) What key strategic approach did Zing use to expand its market
presence in the automotive industry?
(a) Product innovation and design
(b) Cost leadership strategy
(c) Entering new international markets
(d) Vertical integration (2 Marks) 
(ii) How did Zing protect its market share from potential competitors?
(a) Price-cutting strategy
(b) Branded software and switching costs
(c) Aggressive marketing campaigns
(d) International expansion (2 Marks) 
(iii) Why did Zing's differentiation strategy fall short in the market?
(a) Intense price competition
(b) Poor marketing strategy
(c) Inconsistent quality and service
(d) Lack of international expansion (2 Marks) 
(iv) Forging partnerships with established dealerships to enhance its
distribution network falls under which level of strategy?
(a) Corporate level strategy
(b) Business level strategy
(c) Functional level strategy
(d) Competitive level strategy (2 Marks) 
(v) How did Zing initially expand its market presence across the
nation?
(a) Aggressive marketing campaigns
(b) Developing low-cost vehicles
(c) Partnering with established dealerships
(d) Launching a luxury brand (2 Marks) 
(B) Compulsory Application Based Independent MCQs
(i) TechMex Inc., a leading technology company, offers a diverse
portfolio of products ranging from established cash cows to
237
promising question marks. As part of its strategic planning process, 
the company aims to assess its product portfolio's performance and 
allocate resources effectively. In which quadrant of the BCG Matrix 
would TechMex's new innovative product, recently launched in a 
rapidly growing market, likely fall into?  
(a) Cash Cow
(b) Dog
(c) Question Mark
(d) Star (2 Marks) 
(ii) BlueSky Enterprises, a multinational corporation specializing in
renewable energy solutions, is undergoing a strategic
transformation to enhance its competitive position in the market. As
part of this initiative, the company is reevaluating its organizational
structure, processes, and culture. Which aspect of the McKinsey
7S Model is most relevant for BlueSky Enterprises during this
strategic transformation?
(a) Strategy
(b) Structure
(c) Systems
(d) Skills (2 Marks) 
(iii) The threat of substitutes is high when:
(a) There are few substitute products available
(b) Switching costs are low
(c) Suppliers have high bargaining power
(d) There is strong brand loyalty (1 Mark) 
PART II – Descriptive Questions (35 Marks) 
Question No. 1 is compulsory. 
Attempt any two questions out of the remaining three questions. 
1. (a)  Swati is the marketing manager at a software company. She is
responsible for developing and implementing marketing strategies for 
the company’s products. Swati leads a team of marketing professionals 
and works closely with the product development and sales teams to 
ensure that the company's products are effectively promoted in the 
market. She also analyzes market trends and customer feedback to 
refine the marketing strategies. Which level is she working at, discuss 
the roles and responsibilities of this level in organization?   (5 Marks) 
(b) ABC Corp, a multinational consumer electronics company, is planning to
expand its operations into a new country. The company's senior
management is evaluating the potential risks and opportunities of
238
entering this new market. As part of their analysis, they decide to use 
the PESTLE framework to assess the external factors that could impact 
their decision. How can the PESTLE framework help ABC Corp assess 
the external factors affecting its decision to expand into a new country? 
(5 Marks) 
(c) Imagine you are a consultant advising a small manufacturing company
embarking on a digital transformation journey. The company's leadership
is concerned about managing the change effectively. Using the best
practices for managing change in small and medium-sized businesses,
outline a strategy to help the company navigate this transformation
successfully. (5 Marks)
2. (a)  Imagine you are a strategic consultant advising a retail company that is
facing increasing competition from online retailers. The company is 
considering several strategic options to improve its market position. 
Using the concept that strategy is partly proactive and partly reactive, 
explain how the company can develop a strategic approach to address 
this challenge.            (5 Marks) 
(b) You are a strategic manager for a tech company launching a new
smartphone model. The company wants to target tech-savvy consumers
who value innovation and cutting-edge technology. Using the concept of
customer behavior, develop a marketing strategy to promote the new
smartphone.      (5 Marks)
3. (a)  A beverage company is launching a new line of energy drinks targeted
at health-conscious consumers. The strategic manager wants to study 
the market position of rival companies in the energy drink segment. 
Which tool can be used for this analysis, and what is the procedure to 
implement it effectively?      (5 Marks) 
(b) The CEO of a textile mill believes that his company, currently operating
at a loss, can be turned around. Develop an action plan outlining steps
the CEO can take to achieve this turnaround.   (5 Marks)
4. (a)  Why Strategic Performance Measures are essential for organizations?
  (5 Marks) 
(b) How can Mendelow's Matrix be used to analyze and manage the
stakeholders effectively?
OR 
Distinguish between Concentric Diversification and Conglomerate 
Diversification.  (5 Marks) 
239