Strategic MGMT

POKHARA UNIVERSITY
Level: Master Year : 2011

Programme: MBA Trimester Full Marks: 100
Course: Strategic Management Pass Marks: 60
Time : 4hrs.
Candidates are required to give their answers in their own words as far as practicable.
Attempt any SIX questions. Question no. 8 is compulsory. The figures in the
margin indicate full marks.
1. Much of the business environment today is dynamic in nature. What does it mean for an 14
organizational manager and how can the latter go about scanning the environment?
2. What elements should be enshrined in a mission statement? Analyze the following mission 14
statements and discuss whether these elements exist in the following mission statements.
a. Dell’s mission is to be the most successful computer company in the world at delivering
the best customer service in the markets we serve. In doing so, Dell will meet customer
expectations of highest quality; leading technology; competitive pricing; individual and
company accountability; best in class customer support; flexible customization
capability; superior corporate citizenship; financial stability.
b. Proctor and Gamble will provide branded products and services of superior quality and
value that improve the lives of the world’s consumers. As a result, consumers will reward
us with industry leadership in sales, profit, and value creation, allowing our people, our
shareholders, and the communities in which we live and work to prosper.
3. Banking industry has been one of the fastest growing industries in Nepal. However, in recent 14
days it is experiencing a sort of turmoil. Draw a strategic group map depicting major names in
the industry based on two key success factors based on your own judgment and explain the
implication of this map.
4. What are the basic differences between BCG matrix and GE nine-cell matrix? When are these 14
tools most applicable in strategy formulation?
5. Generic strategy is a combination of competitive strategy and competitive scope in Broad and 14
Narrow segments. Explain the salient features of the same. Explain what “STUCK IN THE
MIDDILE” strategy means.
6. When should a company adopt matrix structure of organization? Explain with suitable examples 14
discussing the conditions and merits of matrix organization.
7. How and why do you think leadership and organizational culture prove to be impediment in 14
implementing a new strategy? What do you think should be done if organizational culture
emerges as a major hurdle in the process of strategy implementation?
8. 30
Given below is a case of an organization "J .K. Paper Ltd.". Please go through it carefully and
then answer the questions raised at the end of the case. (Be analytical and logical.).
The ripple effects of the 2008 Global Economic meltdown had begun to hurt the Rupees 1,268
crore J.K. Paper Ltd. also. Like all other business houses in India, J.K. Paper Ltd., was also
finding the going though. The general trend of soaring prices and contraction in demand had
starting affecting the sale of J.K. Paper Ltd., products also. Its customers were focusing on
correcting their inventory position (using existing stocks of material to keep production lines
1
and marketing activities rolling). Consequently, they were not buying much from J.K. Paper
Ltd.; stock fell from Rs. 57.20 on 1 January, 2008 to a low of Rs. 14.12 on 12 March, 2009.
The company was in the midst of economic crisis. Mr. Harshpati Singhania, Managing
Director of the Company, realized that some strong measures must be taken to extricate the
Company from its present crisis. To this end, Mr. Singhania held several brainstorming
sessions with top management team and finally identified the focus areas: Managing working
capital flows, cutting costs and paying attention to employee productivity.
Moving away from the traditional approach one usually follows during the recessionary
periods. Mr. Singhania instead of shutting down company’s plants and cutting production
decided to continue to operate the Company’s two plants at Gujrat and Orrisa at 100%
capacity. To match sales with production, he planned to reach out to newer customers by
widening Company’s distribution network. He identifies packaging boards to be marketed in
rural areas where the meltdown had minimal effect. As the market conditions were still
difficult, the company decided to cut the prices by 2 to 3 per cent. Along with the price cut, its
marketing thrust in rural areas ensured that the sales were not impacted much. Net sales
remained flat throughout 2008-09; though the profitability of the Company suffered because of
the lower margins it received from its rural thrust.
For raising capital further, the Company did not approach banks and investors; rather it
intensified efforts to recover its debits from its clients. The efforts resulted in fast recovery of
crores of rupees. Disputed debts were also settled expeditiously to raise more cash.
Too cut costs, the Company took steps to improve productivity and reduce its wage bill.
Inefficient employees were asked to leave. No new appointments were made unless they were
critically important. In addition, employees received lower increments for 2008-09; even Mr.
Singhania did not take any increment.
When the global slow down sent the international prices of the pulp, the main raw material for
the paper industry, crashing from Rs. 36,960 per tonne in April, 2008 to Rs. 18,240 per tonne
in September, 2008, the company bought enough pulp to last for about 9 months as against its
policy of buying in the normal course, pulp for about 2-3 months. According to Mr. Singhania,
this decision also resulted in a huge saving.
Mr. Singhania and his senior management team also re-evaluated the organizational structure
to improve efficiency in the organization.
When all the above strategic decisions had been successfully implemented, Mr. Singhania
knew that the worst for the company was over. This was also reflected in gradual increase in
the quarterly profits of the company. Mr. Singhania however sounded very modest about his
stewardship of the company with appreciating his Senior management team for the great job
done to ride out the slowdown.
Questions:
1. Where did the recession hit J.K. Paper Ltd.?
2. Explain with reasoning the corporate strategy the Company had adopted for the survival.
3. What functional strategies were undertaken by the Company to overcome its crisis?
4. State the basic responsibilities of s strategic leader in a business house. Explain whether or
not Mr. Singhania provided strategic leadership to the Company.
5. What lessons are learnt from the experience of J.K. Paper Ltd., to ride out the economic
meltdown?
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POKHARA UNIVERSITY

Level: Master Year : 2011

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