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Very short question 2*10=20

1. Define strategy and strategic management.


2. List the process of strategic management
3. List the two benefit of strategic management
4. Mention the three approaches to environment scanning.
5. List the internal strategic factors in strategic management.
6. Define core competencies with one example.
7. Differentiate tacit knowledge from explicit knowledge.
8. Define mission and vision.
9. Define strategy formulation.
10. Define corporate strategy and business strategy.

Long answer type question 4*5=20

11. Strategic management is a set of managerial decisions and actions that


determines the long- run performance of a corporation. Discuss
12. The major challenge to the strategic management are globalization and
environmental sustainability. Discuss with one example of each.
13. Management must scan not only the natural environment for possible strategic
factors, but also include in its strategic decision-making processes the impact of
its activities upon the natural environment. Discuss with example.
14. Just because a firm is able to use its resources, capabilities, and competencies
to develop a competitive advantage does not mean it will be able to sustain it.
Explain two characteristics that determine the sustainability of a firm’s
distinctive competency (ies).
15. Differentiate goals from objectives.

Section three: Group C 3*10=30

16. Michael porter approach to the analysis of the industry competition can be a
useful tool to determine the competitive scenario in any industry. Assuming that
you are the manager of the educational consultancy do the competitive analysis
that you will have to present to the board of director.
17. List the ten components of the mission statement and identify the components
used in the following mission statement of ABC bank.
"To provide easy and innovative banking products and services for our customers
by implementing one stop service concept from our wide network using our modern
technology qualified human resources in competitive environment. We always look
for the benefit of the local communities supporting entrepreneurship, social
responsibility and economic prosperity of the nation."

18. Following are the list of opportunities and threats for a trekking business in
Nepal:
Opportunities Threats

Natural Beauty/ Hospitality Political Instability

International recognition Weak Government Regulations/ Laws

Cheap Price for travel and food Weak Safety Measures

Growing market of tourism No formal training to guides

Considering all of the above points, prepare External Factor Analysis Table (EFAS
Table) for trekking business in Nepal.

19. Suppose you are planning to open a restaurant near Gokarna area:
a. What would be the various external environmental variables/ task
variables, you need to analyze?
b. Out of the identified factors in (a), which factors have the highest
priority and which has the lowest priority, identify on the basis of issue
priority matrix

Section three: Group D

The airline manufacturing industry consists of only two firms, Airbus in Toulouse,
France and the Chicago-based Boeing. Two recent research and development moves
at the two firms offer an insight into the positioning strategy that each is taking in the
future market place. It seems the two firms are accenting two niche markets with a pair
of flagship products, neither of which are in direct competition with each other. This
will allow for the firms to stave off price competition in the short term by differentiating
product lines, which is desirable given the recent increase in buyer power gained by
low cost airlines.

Current Market Position

Airbus controls 46% of the market. It was formed in the 1970’s as a consortium of
European aerospace firms, and was integrated into a single company in 2001. It was
designed by European nations to compete with the large American manufacturers and
received subsidies from the various European governments. Their product line extends
from the single aisle A320 to the larger, twin aisle A340.

Boeing, naturally, currently controls the other 54% of the market for commercial
aircraft in terms of value delivered, and its commercial unit took in $30.1 billion in
2001.2 It introduced the 747 Jumbo Jet in 1966 which revolutionized the concept of
air travel due to its large size, and ushered in the era of mass air travel. In addition, it
produces a wide range of aircraft from the single aisle 737 favored by point-to-point
airlines such as Southwest, and the medium size and range 767, to the long range 777.
Boeing is also a weapons contractor, designing and producing attack aircraft and
satellites. It also maintains a services group and has recently launched Connexions,
which provides internet access to airline passengers.

Current Aircraft Market

The airline industry is in a downturn. In 2001, the International Air Transport


Association had a net loss of $17 billion, which is more than the industry has made in
its entire history. This has led to a grim short-term outlook for the airline manufacturers,
and subsequently Boeing has cut 2002 production in half and Airbus by one fourth.
This, however, is not necessarily a good measure of the industry’s condition, since both
companies have an extensive backlog that can be used to maintain these new targets.
Although the total backlog of 2,783 planes is worth an estimated $172 million dollars6
it is also somewhat uncertain due to lax cancellation penalties negotiated by the airlines
during the boom years. Furthermore, the rise of low-cost airlines does not directly
translate into a larger market for aircraft due to the fact that the success of low end
carriers tends to reduce the demand for aircraft by the large carriers. It is important to
note however, that this is not a permanent depression in the market, but a reflection of
the cyclical nature of the industry.
Future Airline Industry Outlook

Both Airbus and Boeing, foresee dramatic growth in the airline industry over the next
twenty years, with the firms forecasting average annual growth of revenue passenger-
kilometers at 4.2 and 4.9% respectively. This will be generated by lower ticket prices
and economic growth. In addition, the two firms also believe that the Asian market will
be the region of largest increase in traffic. They however, disagree on the path of the
overall growth. Airbus places more emphasis on the markets between large hub cities
and predicts that as airports reach traffic capacity, it will become necessary for airlines
to fly as many passengers as possible in a single flight. Boeing, however, anticipates
major growth in low cost point-to-point carriers and predicts that while higher capacity
is desirable, the airlines will continue to augment large fleets with smaller aircraft that
enable more frequent and quicker flights. As a result, Airbus foresees a large demand
for very large aircraft to service major routes, while Boeing forecasts that most growth
will come from single and twin aisle aircraft, to service connecting and point to point
routes.

20. Comment on the competitive environment in the airlines manufacturing


industry. 10
21. Discuss the timing tactics of the Boeing and the airbus with possible advantages
and disadvantages. 10
22. Keeping in mind the porter’s generic strategy which strategy do you think would
be suitable for Boeing and for Airbus? 10