Case Study
CN Company is a manufacturer of confectionary products with a well established position and brand recognition in Country P. The potential for future growth in Country P is, however, limited with the market reaching saturation. A proposal put forward is that to achieve growth CN Company should move into new markets in other countries, offering its existing product range. One possible method of achieving market entry that has been identified is through a joint venture with a company that is already established in Country K.

The business development team are undertaking a feasibility study to explore the viability of the proposed strategy to sell CN Company’s confectionary product range in Country K. As part of the feasibility study there will need to be some assessment of industry competition and the attractiveness of the market in Country K.

1. Based on the case study above, explain how Porter’s Five Forces model could be used by the business management team to assess the confectionery industry competition in Country K. [25 Marks]

2. Analyse how the work breakdown structure (WBS) technique and Gantt charts can assist in the project management process. [25 Marks]

Read the excerpt below to answer question 3.
MT is the entrepreneurial owner of S Software Development Company which he set up five years ago with his business partner ZF, who provided the financial backing. Since that time the company has grown. Despite MT not having any clear view on what should happen, strategies have tended to emerge without any formal approach. ZF feels that, whilst still a small business, the company has come to a point in its lifecycle where perhaps a more formal approach to establishing its future strategic direction would be beneficial. However, MT has a different view and argues that the company has been a success to date. He feels that ZF’s suggestion to adopt a formal rational approach to strategy development would have more disadvantages than advantages.

3. Describe the potential advantages and disadvantages of the formal rational approach to strategy development for S Software Development Company. [25 Marks]

4 a) What are the main characteristics of strategic decisions?

4 b) What measures can we use for assessing resource utilization? [10 Marks] [15 Marks

Answers to Above Questions on Strategic Management

Answer 1: Before expanding into a new market, it is important to perform a thorough analysis of the industry performance in the target market. In the given scenario of expanding the confectionery business to Country K, it is important to analyse the industry and market condition in country K for the confectionery products offered by CN company. Porter 5 forces model would be highly useful in this respect as it would help in understanding existing confectionery brands available in country K, and the level of competition within them. By applying this tool, it would also be possible to identify whether there is any substitute product available in the country in relation to confectionery items, and how it would affect the business of CN in expanding its confectionery brand. It would also be possible to understand the suppliers available in the market for confectionery products, and decisions could be possible regarding the sourcing of raw materials to produce the final product.

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