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CIPS Exam Report for Learner Community:

Qualification:
Unit:
Exam series:

Professional diploma in procurement and supply


PD2 - Corporate and business stratergy
July2016

Each element of a question carries equal weighting unless otherwise stated.


Question 1 Learning Outcome 1

Mark

Evaluate the benefits and limitations of the rational approach to strategic


planning in organisations

25 marks

Learning outcome addressed 1.1


Command word explanation Evaluate calculate or judge the value of something
Examples of good content/good approaches in answers: The command word was used in the style of
response which was to judge as opposed to simply describing the benefits and limitations of the rational
approach to strategic planning. Further it was necessary to see embedded from the start of the response an
explanation of the rational approach to strategic planning. It then was necessary to delve into the heart of the
question and cite up to two or three examples of benefits which could have included, but not limited to:
It allows the setting of objectives for the organisation
It facilitates the communication of strategic intent and objectives to stakeholders
It provides a systematic review and the long term view taken, rather than a series of operational and
reactive decisions
It provides a structure for information gathering and analysis; can allow a master plan for business
development and operational/business unit planning.
Then it was necessary to counterbalance that with the same number of limitations which could have included,
but not limited to:
Organisations may not have resources and expertise for planning or selection/implementation
Assumptions need to be made about the future state
The environment or industry may be dynamic fast changing, uncertain this in turn limits the
usefulness of some strategic planning
Communication of the plan can be difficult potential disclosure of competitive information, relative
complexity; current position may not be as easy to establish competitors for instance are unlikely to
assist with their intentions.
Examples of content for merit/distinction grade answers: Good structure to the answer that was clear in
intent and was fully evaluated with a suitable closing conclusion. A more detailed explanation of strategic
planning that could have encompassed a comparison to the emergent approach which does not rely on a

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structured planning process as does the rational approach.


Examples of poorer content/ poorer approaches in answers: Little or no evaluation mere descriptive answers
that had no substance often just a series of bullet points that described some benefit and limitations. No
overarching explanation at the commencement of the answer that explained anything about the strategic
planning process and no conclusion.
Concluding comment: The standard on this question did vary from the poor to the excellent. It is vital that
candidates read the question fully before attempting to answer it fully understanding what it calls for; the
command word(s) used and to apply that style of response and as appropriate offer an introduction that taps
into the context of the question with a closing conclusion that reinforces main points associated with the
response given.

Question 2 Learning Outcome 2

Mark

(a) Appraise the competitive environment of an organisation of your


choice, or of one of its strategic business units (SBU) using Porters Five
Forces framework

15 marks

0 marks
(b) Discuss TWO potential limitations of the Five Forces framework in
analysing an organisations competitive environment
Learning outcome addressed 2.2
(a) Command word explanation Appraise evaluate something, giving views based on strengths and
weaknesses of a given situation
Examples of good content/good approaches in answers: First and foremost to secure a pass it was necessary
to do as the question asked choose an organisation to contextualised or centre your response around failing
to this and giving a generic response led to an automatic fail grading to this question. Taking Part a) to
reiterate, you attempt in this response to judge the competitive forces aligned to the Five Forces that Porter
talked of to an organisation of your choosing so those candidates who did this by an opening statement prior
to conducting a Five Forces Analysis displayed good technique. It was necessary to get the detail of the Five
Forces Analysis correct and to follow a process developing each point in relation to your organisation of
choice starting with judging/evaluating the threat of new entrants coming into the industry citing such
examples as say economies of scale; difficulty of access to distribution channels; high capital investment
requirements; branding; scare skills or resources and so on. Then the threat of substitute products or services
to those produced by the industry citing such examples as say the relative price-performance of substitutes;
the extent of switching costs and the propensity of buyers to use substitutes will all effect the intensity of this
threat. Then the bargaining power of suppliers which affects the costs incurred by the industry citing such
examples as finding it difficult to switch suppliers because of the scarcity of them; the expense incurred to

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change; the product/service is a relatively minor market for suppliers. Then the bargaining power of
customers or buyers provides us with a mirror image of that exerted by suppliers to an industry sector citing
such examples as when there are relatively few buyers or they can switch without little or no difficulty then
the bargaining position of the industry is weakened, with pressures to reduce prices or increase the quality of
products provide. The, finally the intensity of rivalry between existing competitors within the industry citing
such examples as the number and size of competitors; the rate of growth of the industry; the risks of creating
over-capacity; the similarity of products/services and the ease with which competitors can leave the industry.
Examples of content for merit/distinction grade answers: A well-structured and thoughtful response that
tied right back to the organisation of choice. Giving a good account of the impact of the forces at work.
Inserting the Framework as an illustration within the response
Examples of poorer content/ poorer approaches in answers: Generic responses that were not aligned to a
specific organisation of industry sector. Describing as opposed to appraising.
Concluding comment: Some candidates did not appraise Porters Five Forces and talked in general about
competitive forces When it came to each of the five elements to the framework it was necessary to give a
good account rather in some responses where one or two sentences were written.
(b) Command word explanation Discuss consider something by writing about it from different points
of view
Examples of good content/good approaches in answers: Here we were looking for TWO limitations and
justification of these points made.
Examples of content for merit/distinction grade answers: A well rounded justification to each of the two
limitations cited. Demonstrating good research by going beyond that stated in the Study Guide.
Examples of poorer content/ poorer approaches in answers: Some candidates provided up to six
limitations Only the first two were marked this is time wasting.
Concluding comment: When asked a specific question respond to the instruction embedded within the
question. There were several candidates who seemed to struggle with this question.

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Question 3 Learning Outcome 3

Mark

Explain the following concepts in the context of strategic change in supply


chain environments:
(i)
Cultural Web
(ii)
The tendency towards strategic drift
(iii)
Path dependency

10 marks
8 marks
7 marks

Learning outcome addressed 3.2


Command word explanation Explain give reasons for or account for something
Examples of good content/good approaches in answers:
(i)
Cultural Web: here it was necessary to properly explain the concept covering such aspects but
not necessarily limited to the following. It provides an approach for looking at and changing an
organisational culture. By working through the concept management can expose cultural
assumptions and practices and set to work aligning organisational elements with one another and
with an organisations strategy. This paradigm comprises six elements and a good approach listed
these including what impact each had Stories Rituals & Routines Symbols Organisational
Structure Control Systems & Power Structures each when analysed in turn can help
management begin to see the bigger picture of the culture of the organisation and what is
working and what isnt working and what then requires to changed. Good application of the
points made.
(ii)
The tendency towards Strategic Drift: This is where there is a tendency towards strategies
developing incrementally on the basis of historical and cultural influences but fail to keep pace
with a changing environment (Johnson & Scholes). When this occurs organisations become
reluctant to disturb relationships with customers, suppliers or the workforce even if they need to
change and know that they to change. When this happens we witness lagged performance
effects. Conservative strategies are often at this time adopted coupled with a reluctance to move
away from strategies that have successful but have had their day. Also management stick with
what they know a comfort zone uncertainty of change is met with a tendency to stick to the
familiar. Good application of the points made.
(iii)
Path Dependency: This is a natural follow through from strategic drift and its immediate effects
because it is not always highly visible in an organisation it is important to proactively monitor and
recognise the role of historical tendencies in strategic development, and the manner in which
they become embedded in an organisational culture. Path dependence is the notion that
decisions we are faced with depend on the past knowledge trajectory and decisions made, and
are thus limited by the current competence base, in other words, furrows in a road that become
deeper and deeper as the traffic goes along. Once this occurs the traffic (decisions) has no option
but to go along these furrows. Good application of the points made.

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Examples of content for merit/distinction grade answers:


(i)
Cultural Web: Illustrating what the cultural web looks like and to having an extended discussion
on incremental change weaved into the logic of the response. Excellent application of the points
made.
(ii)
The tendency towards Strategic Drift: Expanded out to include the fact that when we are in the
midst of strategic drift capabilities that are taken for granted and deeply ingrained in routines are
difficult to change even when they are no longer suitable. Including a pictorial representation of
strategic drift. Excellent application of the points made.
(iii)
Path Dependency: developing the response to include: making history important for current
strategic decision-making situations and thereby is a strong influencer on strategic planning.
Excellent application of the points made.
Examples of poorer content/ poorer approaches in answers: Mis-reading the question and talking about
strategic change at length with little or no reference to the Cultural Web. Talking about culture what it means
how it affects the organisation dynamic with no reference at all the concept of the Cultural Web. In the case
of Strategic Drift, misinterpreting what it means. The same problem occurring with Path Dependency with a
high number of candidates simply not responding to that part of the question.
Concluding comment: There was a level of poor understanding on specific concepts also an inability to
apply the concept into practice which at this level of studies is vital and necessary.

Question 4 Learning Outcome 4

Mark

(a) A company has taken a strategic decision to utilise new technology


solutions to manage information within its supply chain more
effectively. Examine the factors that management might consider in
developing a plan to implement this strategy.

13 marks

(b) Discuss the factors that management might consider in developing a


plan to implement this strategy

12 marks

Learning outcome addressed 4.1


(a) Command word explanation Examine provide both a description and an explanation of
something
Examples of good content/good approaches in answers: Candidates who started their answer off in context
such as by considering generic aspects of information as a strategic resource demonstrated a good approach
as a snapshot here we are looking at aspects such as: improving customer focussing; reducing administration
and other costs; improved control systems; creating learner corporate structures; additional differentiating

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factors. Then linked to new technologies a discussion should then follow on some information systems say
two or three such as databases; decision support systems; management information systems; ERP; EDI,
intranets and mobile communications. Good content in responses then developed on the potential impact of
new technology in achieving corporate objectives. Covering such aspects but not limited to: Cost savings;
changing the configuration of supply chains; enhanced supplier and customer information; more efficient coordination of supply chain processes and development of electronic procurement systems.
Examples of content for merit/distinction grade answers: Strong credible logical responses that answered
the question well putting technology at the heart of the management of the supply chain. Part b) developed
answers into the risks associated as part of the planning process.
(b) Command word explanation Discuss consider something by writing about it from different points
of view
Examples of good content/good approaches in answers: demonstrating a good understanding on how a plan
requires to be put in place and to go on to demonstrate a good understanding of the process of implementing
the chosen strategy effectively. Aspects here include but not limited to: rational versus emergent models of
planning or intended or realised strategy; the level of technological complexity higher levels of complexity
carry higher levels of risks; the available resource base in-house versus consultancy support; using outcomes
to formulate a plan of activities; actions and deliverables.
Examples of content for merit/distinction grade answers: expanding in more detail alongside demonstrating
good application of the points made. Discussion on contingency planning vital when it comes to introducing
technology. The importance of having sustained management commitment
Examples of poorer content/ poorer approaches in answers: in both parts of this question, generic responses
that looked at technology in general and not specifically looked at examples of technology used in the
management of an effective supply chain.
Concluding comment: Again, across both parts, a) and b), short responses that lacked depth and scope were
prevalent.

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