DO NOT OPEN THIS QUESTION PAPER UNTIL YOU ARE TOLD TO DO SO

The Chartered Institute of Management Accountants 2013

E
2

E
n
t
e
r
p
r
i
s
e

M
a
n
a
g
e
m
e
n
t

Enterprise Pillar
E2 Enterprise Management
28 February 2013 - Thursday Session

Instructions to candidates
You are allowed three hours to answer this question paper.
You are allowed 20 minutes reading time before the examination begins
during which you should read the question paper and, if you wish, highlight
and/or make notes on the question paper. However, you are not allowed,
under any circumstances, to open the answer book and start writing or use
your calculator during this reading time.
You are strongly advised to carefully read all the question requirements
before attempting the question concerned (that is all parts and/or sub-
questions).
ALL answers must be written in the answer book. Answers or notes written
on the question paper will not be submitted for marking.
ALL QUESTIONS ARE COMPULSORY.
Section A comprises 5 questions and is on pages 2 to 4.
Section B comprises 2 questions and is on pages 5 and 6.
The list of verbs as published in the syllabus is given for reference on page 7.
Write your candidate number, the paper number and the examination subject
title in the spaces provided on the front of the examination answer book. Also
write your contact ID and name in the space provided in the right hand
margin and seal to close.
Tick the appropriate boxes on the front of the answer book to indicate which
questions you have answered.






TURN OVER



Enterprise Management 2 March 2013


SECTION A 50 MARKS
[You are advised to spend no longer than 18 minutes on each question in this section]
ANSWER ALL FIVE QUESTIONS IN THIS SECTION

Question One
Whilst the managers within FS Company's finance department have excellent technical skills,
the Finance Director is keen to enhance their people management skills. Rather than ask the
HR Department to do the training, he has decided that each manager should lead a workshop
on a particular people management theme.

As one of the managers in the department, TF has been given the task of briefing her
colleagues on the importance of having a company disciplinary procedure as part of its internal
control system. The briefing will also cover the issues associated with employee dismissal.










Question Two
J , the Finance Director, is preparing for an important negotiation with P, the Marketing and Sales
Director, regarding the way the company's sales targets will be set in the future. Whilst he is
confident that he has a good case, he knows that having effective communication skills will be
vital to the success of the forthcoming negotiation.






Section A continues on the opposite page


Required:
Explain to J the potential barriers to effective communication in the negotiation process and
how they can be overcome.
(Total for Question Two = 10 marks)
Required:
(a) Explain what TF should include in her briefing on the reasons why FS Company
should have a disciplinary procedure as part of its internal control system.
(6 marks)
(b) Describe the main reasons, which TF could include in her briefing, when the
dismissal of an employee could reasonably be considered to be fair.
(4 marks)
(Total for Question One = 10 marks)






March 2013 3 Enterprise Management

Question Three







Question Four
FLF is a courier company based in Z Country which offers direct document and parcel express
delivery services for commercial customers. It prides itself not only on its reliability but also its
service in relation to customer convenience by picking up documents and parcels from its
customers' home or business addresses. The company has established an excellent reputation
for fast collections and on-time delivery. Its vision is to be known as the number one choice and
best value courier company for all businesses in Z Country.











Section A continues on page 4





TURN OVER
Required:
(a) Explain the reasons why FLF should undertake competitor analysis.
(6 marks)
(b) Describe what is involved in benchmarking and how it could help FLF, as part of its
competitor analysis.
(4 marks)
(Total for Question Four = 10 marks)

Required:
Explain the advantages AND disadvantages of having a matrix structure for managing a
project.
(Total for Question Three = 10 marks)




Enterprise Management 4 March 2013


Question Five
LG, the Managing Director of NWP Company, recently announced to the workforce that the
Board had agreed to the establishment of a set of new working practices which should lead to
improved productivity. The new working practices will mean the introduction of weekend working
and the rotation of shifts for all workers.

The senior management of NWP Company consider the changes to be necessary if the
company is to survive the very difficult operating conditions it is currently facing. However, the
announcement has led to conflict between management and workers, and the workers are now
threatening industrial action.









(Total for Section A = 50 marks)




End of Section A

Section B starts on the opposite page
Required:
Discuss the different strategies that LG could use to manage the conflict occurring in NWP
Company.
(Total for Question Five = 10 marks)




March 2013 5 Enterprise Management

SECTION B 50 MARKS
[You are advised to spend no longer than 45 minutes on each question in this section]
ANSWER BOTH QUESTIONS FROM THIS SECTION 25 MARKS EACH


Question Six
T Company has identified a need for, and made a decision to open, a new training centre in one
of the major cities in E Country. This is a large scale project for T Company and it needs to
make sure that the project for finding and developing the centre is delivered successfully, since
this is a major investment for T Company. It does not want to make an expensive mistake. In
order to maximise revenues the centre needs to be completed and open within a six month time
scale. The company understands that large scale projects usually follow a lifecycle made up of
separate phases which occur in sequence.









Section B continues on page 6










TURN OVER
Required:
(a) Explain to T Company what should happen at the project initiation stage of the
project lifecycle for the training centre project.
(15 marks)
(b) Explain how the techniques of PERT (Project Evaluation and Review Technique),
scenario planning and buffering could be used in project management with specific
reference to the time scale aspect of the new training centre project.
(10 marks)
(Total for Question Si x = 25 marks)



Enterprise Management 6 March 2013


Question Seven
LD is the owner and manager of her own florist business, LD Flowers. Although starting out
initially as a hobby, it has developed into a sustainable business. LD's original business was
based on using only flowers from her garden, but as the business has grown she has been
forced to seek alternative supplies of flowers. However, she has remained loyal to her ethical
stance by choosing and buying her flowers only from local growers that she knows. She feels
that this, together with her particular design of contemporary flower arrangements, differentiates
LD Flowers from the other local florists and supermarkets which tend to offer more traditional
arrangements using flowers imported from overseas.

In the beginning, LD sold her flower arrangements primarily at local markets, occasionally
getting commissions from family and friends. Subsequently, she has been successful in entering
the wedding business, providing flowers for the wedding venue as well as bridal bouquets. She
has also recently won a contract to supply flower arrangements to a local hotel chain, which was
impressed with her contemporary approach to flower arranging.

As the owner of a successful small business, LD has received an invitation to an event
promoted by her bank on the need for formal strategic planning in small businesses. However,
she has politely declined to attend the event on the basis that she has not needed to undertake
such planning herself and hence does not think that the content of the session will be relevant to
her business. Instead, she feels that it is better to let the strategies for her business emerge.




(Total for Section B = 50 marks)


End of Question Paper

Required:
(a) Explain the theoretical principles of the Resource Based View (RBV), and the extent
to which LD's business, LD Flowers, has developed its competitive advantage by
using the RBV.
(13 marks)
(b) Discuss whether or not LD is right to be doubtful about the relevance of formal
strategic planning for her business.
(12 marks)
(Total for Question Seven = 25 marks)



March 2013 7 Enterprise Management


LIST OF VERBS USED IN THE QUESTION REQUIREMENTS
A list of the learning objectives and verbs that appear in the syllabus and in the question requirements for
each question in this paper.

It is important that you answer the question according to the definition of the verb.
LEARNING OBJECTIVE VERBS USED DEFINITION
Level 1- KNOWLEDGE

What you are expected to know. List Make a list of
State Express, fully or clearly, the details of/facts of
Define Give the exact meaning of
Level 2 - COMPREHENSION

What you are expected to understand. Describe Communicate the key features
Distinguish Highlight the differences between
Explain Make clear or intelligible/State the meaning or purpose of
Identify Recognise, establish or select after
consideration
Illustrate Use an example to describe or explain
something
Level 3 - APPLICATION

How you are expected to apply your knowledge. Apply
Calculate
Put to practical use
Ascertain or reckon mathematically
Demonstrate Prove with certainty or to exhibit by
practical means
Prepare Make or get ready for use
Reconcile Make or prove consistent/compatible
Solve Find an answer to
Tabulate Arrange in a table
Level 4 - ANALYSIS

How you are expected to analyse the detail of
what you have learned.
Analyse
Categorise
Examine in detail the structure of
Place into a defined class or division
Compare and contrast Show the similarities and/or differences
between
Construct Build up or compile
Discuss Examine in detail by argument
Interpret Translate into intelligible or familiar terms
Prioritise Place in order of priority or sequence for action
Produce Create or bring into existence
Level 5 - EVALUATION

How you are expected to use your learning to
evaluate, make decisions or recommendations.

Advise
Evaluate
Recommend
Counsel, inform or notify
Appraise or assess the value of
Propose a course of action











Enterprise Management 8 March 2013


Enterprise Pillar
Management Level Paper
E2 Enterprise Management
March 2013
Thursday Session