SCS

MAY_AUG22:
E3 APPLIED
 2

1 2 3
Stakeholder Ethics Impact of
management Ecosystems on
Strategy

4 5
Evaluating Wrap-up
strategic
choices

AGENDA
1. STAKEHOLDER MANAGEMENT
 4

MENDELOW’S MATRIX

Level of interest
Low High
Low

Minimal effort Keep informed

Power

e.g. neighbouring e.g. retailers

businesses

Keep satisfied Key Players

e.g. tax authorities e.g. government
High

regulators/customers
 5

STAKEHOLDER MANAGEMENT

> If the needs of different stakeholders conflict,

the organisation will likely have to prioritise
the interest of its key stakeholders

> In order to be successful, a strategy must be

acceptable to key stakeholders at least. As
such, it is advisable that key players are
consulted during the planning process
 6

STAKEHOLDERS & STRATEGY

Develop strategy which Identify relevant

meets the needs of key stakeholders
stakeholders 04 01

Strategy

03 02
Assess the needs of high Rank and prioritise the
priority (key) stakeholders stakeholders
 7

RELATIONSHIP BUILDING

> Building alliances e.g. with providers of

complementary services

> Collaboration with your own suppliers e.g. to

secure exclusive distribution

> Building loyalty with customers e.g. via reward

cards or relationships marketing
 8

RESOLVING CONFLICT

Sequential attention: Side payments:

Addressing each group independently in Making some kind of financial concession or
turn, rather than trying to meet all their payment to a group if its primary objectives
needs at the same time cannot be met.
02 03

Satisficing: Exercise of power:

Using negotiation between 01 04 A senior figure imposing a decision if there
key stakeholder groups to is no other way of resolving conflicting views
find a compromise which is
acceptable to all
 9

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 10

PRE-SEEN PAGE 8
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PRE-SEEN PAGE 10/11

 12

PRE-SEEN PAGE 14
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PRE-SEEN PAGE 17
 14

STAKEHOLDER MANAGEMENT

> Perhaps the areas where “friction” is most likely to

occur between Snakwheel and its stakeholders, are
with the restaurants that it serves, and with its couriers

> There are indications in the real-world industry and in

the pre-seen that restaurants may become dissatisfied
with the size of the commissions that they are expected
to pay to companies like Snakwheel

> Independent contractor couriers face significant

uncertainty in their day to day pay, and could easily feel
aggrieved when they compare their situation with the
employee couriers

POTENTIAL SCENARIO
Question
> Peter Fodya calls you into his office and hands you a
document: “This is a press release that was sent to me
this morning by Chief Executive Ahmad Farah. It
appears that several fast food restaurant chains in
Westaria are considering forming the “Westarian Fast
Food Alliance”. Several of the restaurants we serve are
among the signatories to the provisional agreement.
One of the main motivations stated in the press release
was that fast food restaurants feel that they are being
charged unsustainably high commissions by third party
delivery services, and that collective bargaining may be
the only way for them to achieve more acceptable
commission rates in the absence of government action
or voluntary concessions by the third party delivery
companies. Though Ahmad feels this may be a bluff, he
wants to take it seriously. I need you to prepare a
briefing paper ahead of the next board meeting in which
you:
A. Explain how our fast food restaurants should be
managed as a stakeholder group in light of this
development.” (sub-task (a) = 40%)
15
Answer
Response
• It’s useful first to consider how fast food restaurants were
managed as a stakeholder group up until this point. Previously,
restaurants operated entirely independently of each other and
were in most cases in direct competition. As such, we dealt with
each restaurant (or rather, each restaurant chain) largely as a
separate stakeholder, with each stakeholder having slightly
differing power and interests
• Until now, therefore, certain restaurant chains were key players
that needed to be very carefully managed (e.g. Tastyburger),
while others (especially independent restaurants or smaller
restaurant chains) were less powerful and therefore only
required that we keep them informed
• If this alliance actually becomes a reality, then we will be faced
with a situation where we may have to deal with several
restaurants as one stakeholder group with a common interest
and significant power. That common interest, it seems, is
securing lower commission fees

POTENTIAL SCENARIO
Question
> Peter Fodya calls you into his office and hands you a
document: “This is a press release that was sent to me
this morning by Chief Executive Ahmad Farah. It
appears that several fast food restaurant chains in
Westaria are considering forming the “Westarian Fast
Food Alliance”. Several of the restaurants we serve are
among the signatories to the provisional agreement.
One of the main motivations stated in the press release
was that fast food restaurants feel that they are being
charged unsustainably high commissions by third party
delivery services, and that collective bargaining may be
the only way for them to achieve more acceptable
commission rates in the absence of government action
or voluntary concessions by the third party delivery
companies. Though Ahmad feels this may be a bluff, he
wants to take it seriously. I need you to prepare a
briefing paper ahead of the next board meeting in which
you:
A. Explain how our fast food restaurants should be
managed as a stakeholder group in light of this
development.” (sub-task (a) = 40%)
16
Answer
Response
• The Westarian Fast Food Alliance would very likely be a key
player from Snakwheel’s point of view. As such, it would require
very careful ongoing attention and management in order to
ensure that it does not demand commission rates that would
jeopardise Snakwheel’s long-term financial well-being
• Even in the event that the alliance is not formed, we would still
need to carefully reconsider our future approach to stakeholder
management of individual restaurant chains. The very fact that
these restaurants are seriously considering forming such an
alliance is perhaps evidence that we have failed to adequately
manage our restaurant stakeholders until this point. We were not
aware of the extent of their dissatisfaction, and our failure to
address that dissatisfaction has lead to this potentially damaging
move for Snakwheel
• In the meantime, we should urgently pursue an outreach
campaign with our major restaurant partners in an effort to
gather more information regarding their dissatisfactions, and on
that basis consider opening negotiations

POTENTIAL SCENARIO
Question
> Peter Fodya calls you into his office and hands you a
document: “This is a press release that was sent to me
this morning by Chief Executive Ahmad Farah. It
appears that several fast food restaurant chains in
Westaria are considering forming the “Westarian Fast
Food Alliance”. Several of the restaurants we serve are
among the signatories to the provisional agreement.
One of the main motivations stated in the press release
was that fast food restaurants feel that they are being
charged unsustainably high commissions by third party
delivery services, and that collective bargaining may be
the only way for them to achieve more acceptable
commission rates in the absence of government action
or voluntary concessions by the third party delivery
companies. Though Ahmad feels this may be a bluff, he
wants to take it seriously. I need you to prepare a
briefing paper ahead of the next board meeting in which
you:
A. Explain how our fast food restaurants should be
managed as a stakeholder group in light of this
development.” (sub-task (a) = 40%)
17
Answer
Response
• It will be preferable for us to negotiate with each restaurant on
an individual basis first, as the bargaining power of each
restaurant is likely to be lower if we approach them individually.
It may be that we can find unique agreements with each
restaurant chain that would be less financially damaging to
Snakwheel, while at the same time addressing the grievances
and concerns of our restaurant partners, which may be slightly
different in each case. This is why information gathering in the
short-term from each restaurant is so crucial
• We should certainly also prepare a contingency plan in the event
that these restaurants do indeed go ahead and form the alliance
with a view to engaging in collective bargaining over the
commission rates. We would need to determine our optimal
negotiation strategy, our communication strategy, implications
for our risk register, and more, which will likely need to be
altered in light of the increased relative power of these
stakeholders as a group…
2. ETHICS
 19

FUNDAMENTAL PRINCIPLES

> Professional competence & due care

> Integrity

> Professional behaviour

> Confidentiality

> Objectivity
 20

INTEGRITY

Be honest
01
Do not conceal

04 02
Transparency

03
Ask for help with problems
 21

PROFESSIONAL
BEHAVIOUR

> Uphold the law

> Do not bring the profession into

disrepute

> Treat people with courtesy and

consideration
 22

THREATS TO ETHICAL PRINCIPLES

> Advocacy
> Self interest
> Self review
> Intimidation
> Familiarity
 23

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PRE-SEEN PAGE 9
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PRE-SEEN PAGE 14
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PRE-SEEN PAGE 29

POTENTIAL SCENARIO
Question
> You receive an email from Chief Finance Officer Peter
Fodya. The board has been discussing the possibility of
designing a new algorithm which would take a certain
percentage of any tips/gratuities given to couriers if a
delivery is more than 5 minutes later than the original
estimated delivery window. Even when food arrives late,
customers may have already committed to a gratuity/tip at
the time of making the order and may therefore feel
aggrieved at having extra money given to a late courier. On
the other hand, customers may still wish to give a
gratuity/tip, even if their food arrives a little later than
expected. Nevertheless, the board believes on balance that
such an algorithm would work best for all, as it would
maximise the incentives of couriers to arrive on time and
could generate additional revenues for Snakwheel.
A. Peter Fodya asks you to prepare some briefing notes ahead
of the next board meeting, discussing the ethical implications
of implementing this kind of algorithm. (sub-task (a) = 34%)
27
Answer
Ethics of algorithm:
> There are two useful frameworks for evaluating the ethics of
this decision – the CIMA Code of Ethics, and Snakwheel’s
own core values. Any decision we make on this algorithm
should be aligned with a strong code of business ethics, and
should not contradict our core values, since to do so may
undermine our overall strategy.
> In the context of the CIMA Code of Ethics, two of the
fundamental principles are particularly relevant here –
Professional Behaviour and Integrity.
> Starting with Professional Behaviour, we have a duty as
professionals to treat our stakeholders with courtesy and
consideration. In relation to the proposed algorithm, an
argument could be made that the use of such an algorithm
would constitute a failure to treat both our customers and our
couriers with sufficient courtesy and consideration
> In the case of our customers, if this algorithm was
implemented unconditionally, then we would not be respecting
the wishes of customers who try to pay a full gratuity to
couriers despite their lateness

POTENTIAL SCENARIO
Question
> You receive an email from Chief Finance Officer Peter
Fodya. The board has been discussing the possibility of
designing a new algorithm which would take a certain
percentage of any tips/gratuities given to couriers if a
delivery is more than 5 minutes later than the original
estimated delivery window. Even when food arrives late,
customers may have already committed to a gratuity/tip at
the time of making the order and may therefore feel
aggrieved at having extra money given to a late courier. On
the other hand, customers may still wish to give a
gratuity/tip, even if their food arrives a little later than
expected. Nevertheless, the board believes on balance that
such an algorithm would work best for all, as it would
maximise the incentives of couriers to arrive on time and
could generate additional revenues for Snakwheel.
A. Peter Fodya asks you to prepare some briefing notes ahead
of the next board meeting, discussing the ethical implications
of implementing this kind of algorithm. (sub-task (a) = 34%)
28
Answer
Ethics of algorithm:
> In the case of our couriers: it is already a well -known feature
of our industry that couriers are not paid particularly well. It
could reasonably be argued that targeting one of their only
sources of potential additional revenue is to treat them with
disrespect, and as such to fail to treat them with courtesy and
consideration. This is especially so when one considers that
in many cases, the factors that cause couriers to be late are
not within a courier’s control (e.g. unusually heavy traffic)
> Moreover, with reference to our core values, Snakwheel is
committed to creating “an environment in which the
independent contractors who deliver for us can flourish”. It’s
debatable whether this algorithm is consistent with such a
commitment, seeing as it potentially punishes couriers for
factors over which they have little or no control
> Secondly, depending on how this algorithm is implemented,
this new approach to gratuities/tips could violate the principle
of Integrity. If for example we do not make it transparent to
customers that a certain percentage of their gratuities/tips are
being redirected to Snakwheel, this could constitute…
 29

POTENTIAL SCENARIO

Question Answer
> You receive an email from Chief Finance Officer Peter Ethics of algorithm:
Fodya. The board has been discussing the possibility of > … a lack of honesty and be seen as an effort to conceal
designing a new algorithm which would take a certain information to which the customer has a right.
percentage of any tips/gratuities given to couriers if a
> The same goes for couriers. If we did decide to pursue this
delivery is more than 5 minutes later than the original
estimated delivery window. Even when food arrives late, approach to gratuities/tips, we would need to ensure that
couriers are fully aware of this new policy ahead of time, and
customers may have already committed to a gratuity/tip at
that they are notified each time that they do not receive the
the time of making the order and may therefore feel
full gratuity due to lateness. Otherwise we would be
aggrieved at having extra money given to a late courier. On
manifesting a lack of integrity
the other hand, customers may still wish to give a
gratuity/tip, even if their food arrives a little later than
expected. Nevertheless, the board believes on balance that
such an algorithm would work best for all, as it would
maximise the incentives of couriers to arrive on time and
could generate additional revenues for Snakwheel.
A. Peter Fodya asks you to prepare some briefing notes ahead
of the next board meeting, discussing the ethical implications
of implementing this kind of algorithm. (sub-task (a) = 34%)
3. IMPACT OF ECOSYSTEMS
ON STRATEGY
 31

INTRO TO ECOSYSTEMS

> Interdependent enterprises

+ Improve access
+ Lower costs
+ Create new markets
 32

ECOSYSTEM ROLES – ADDING VALUE

> Asset providers

> Platform providers
> Process providers
> Experience providers
 33

CUSTOMER EXPECTATIONS

> Easy accessibility of comparative

information (Google reviews, Tripadvisor,
price comparison websites etc)

> Lower loyalty to brands

> Higher personalisation expected; one-stop-

shop model increasingly desired

> Service and user experience key for digital

business platforms
ORCHESTRATION
Definition:
“The co-ordination, organisation and management of complex
environments.”
 35

TYPES OF ECOSYSTEM

Orchestration
Loose Tight
High

Hornet’s Nest Lion’s Pride

Complexity

High complexity/ High complexity/

Loose orchestration Tight orchestration

Shark Tank Wolf Pack

Low complexity/ Low complexity/
Loose orchestration Tight orchestration
Low

LION’S PRIDE
FEATURE
Barriers to entry are high as a
result of the complexity of the
activities undertaken by
participants. This type of
ecosystem also manifests
strong orchestration, where
an orchestrator will direct or
heavily influence the activities
of the participants in the
ecosystem.
EXAMPLE
The pharmaceutical industry
involves considerable
complexity in light of the
required expertise and capital
for R&D; it also manifests
tight orchestration given the
significant influence of
government bodies,
certification agencies, patents
etc.
36
STRATEGIES
Participants in this type of
ecosystem should ensure that
their strategies align with the
objectives of orchestrators.
Combining this with
differentiation will help to
ensure participant offerings
remain relevant.
 37

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PRE-SEEN PAGE 10
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PRE-SEEN PAGE 13
 40

ECOSYSTEM & EXAM SCENARIOS

> It’s worth noting that you will rarely be

asked directly about ecosystems on the
day of the exam. CIMA expects rather that
you have a strong background
understanding of ecosystems, and will be
able to draw on that perspective when
answering a variety of strategy-related
questions
> Whenever you see questions, for
instance, about stakeholders, or about the
strategic implications of a decision, you
will be expected to take into account the
nature of the ecosystem in which the
company is operating, and apply those
insights where relevant
 41

ECOSYSTEM: KEY TAKEAWAYS FOR THE EXAM

> In the case of Snakwheel, some of the key

ecosystem considerations include:
> The fact that Snakwheel plays the role of
an orchestrator, whose primary function is
to coordinate, organise and manage the
complexity that its stakeholders cannot
handle by themselves
> The fact that customer expectations now
are higher than ever. In an ecosystem
where high customer volumes are
especially crucial to the survival and
success of the company, any strategy will
need to be consistent with meeting the
high expectations of customers, and
maximise retention and acquisition rates
 42

ECOSYSTEM: KEY TAKEAWAYS FOR THE EXAM

> In light of the complexity and importance

of the IT infrastructure, ensuring adequate
redundancy and in-house maintenance
capacity may be key objectives currently
being overlooked. The number of potential
fail points for the entire system is high.
The ecosystem perspective draws
attention to the strategic importance of
this “orchestration” function
4. EVALUATING STRATEGIC
CHOICES
 44

SUITABILITY: KEY QUESTIONS

Does it exploit the organisation’s strengths and capabilities?

Does it rectify the organisation’s weaknesses?

Does it neutralise or deflect environmental threats?

Does it help the organisation seize opportunities?

Does it fit with the organisation’s mission and objectives?

Will new products/markets fit with existing ones? Will the

strategy improve the balance of the organisation’s portfolio?
 45

ACCEPTABILITY

Would the proposed strategy

meet the expectations of
stakeholders?
1. Identify the relevant stakeholders

2. Assess their expectations and

objectives

3. Would this strategy meet those

expectations and objectives?
 46

TYPICAL STAKEHOLDERS AND THEIR

EXPECTATIONS

Customers: Bank:
- Product - Covenants
- Price - Security
- Service levels 02 03

Shareholders: Staff/wider society:

- Share price / dividend 01 04 - Jobs
- Cash position - CSR
- Long term vs short term
 47

FEASIBILITY FACTORS

Finance (current and capacity)

Resources (land, materials, tech)

People (capabilities, knowledge)

Change management capacity

 48

PRE-SEEN PAGE 16
 49

PRE-SEEN PAGE 10/11

 50

PRE-SEEN PAGE 26
 51

FINANCIAL ANALYSIS
 52

PRE-SEEN P. 14

POTENTIAL SCENARIO
Question
> The board at Snakwheel is considering establishing operations
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with
high levels of disposable income, and fast food consumption has
increased significantly in recent years. Currently, there is only
one domestic company offering third party food delivery, and
they only operate in Farland’s capital city. Farland has several
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
and outreach campaign, it can hope to become the delivery
platform of choice in Farland within a year, and unlock a huge
market with little competitive resistance.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)
53
Answer
Suitability:
• Firstly, the proposed strategy conflicts with our mission
statement as it stands. Snakwheel is currently focused
exclusively on the Westaria market, and so this new strategy
would either require a revision of our current mission statement,
or be rejected outright if the board is unwilling to adapt the
mission statement. All things considered, it would only require a
minor modification to the wording of the mission to make this
new strategy suitable from that perspective. Whether such a
modification will be acceptable will depend on the views of the
rest of the board and (potentially) of shareholders.
• In terms of Snakwheel’s strengths, weaknesses, opportunities
and threats, this strategy certainly appears to be a good fit. We
are not pursuing a new service or product, but merely replicating
as far as possible a service in which we already command a
competitive advantage in our domestic market. The
opportunities are clear, given the fact that this is an underserved
market characterised by a customer base with huge spending
potential…
 54

POTENTIAL SCENARIO

Question Answer
> The board at Snakwheel is considering establishing operations Suitability (continued):
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with • Nevertheless, there may be unconsidered threats that we need
high levels of disposable income, and fast food consumption has to take into account. For instance, we should pay close attention
increased significantly in recent years. Currently, there is only to the political, sociological, technological and legal conditions
one domestic company offering third party food delivery, and that obtain in Farland (PESTEL). It may be that the government
they only operate in Farland’s capital city. Farland has several in Farland is unreceptive to foreign investment, or tightly
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
regulates this kind of economic activity. We may also find that
and outreach campaign, it can hope to become the delivery the technological infrastructure in Farland cannot accommodate
platform of choice in Farland within a year, and unlock a huge our operations. This would need to be carefully assessed before
market with little competitive resistance. we can conclude that this is a suitable strategy.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)

POTENTIAL SCENARIO
Question
> The board at Snakwheel is considering establishing operations
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with
high levels of disposable income, and fast food consumption has
increased significantly in recent years. Currently, there is only
one domestic company offering third party food delivery, and
they only operate in Farland’s capital city. Farland has several
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
and outreach campaign, it can hope to become the delivery
platform of choice in Farland within a year, and unlock a huge
market with little competitive resistance.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)
55
Answer
Acceptability:
• We need to be sure before we pursue this strategy that we do
not compromise or undermine the interests of key stakeholders.
Perhaps most importantly, we must be sure that pursuing this
strategy will not cause us to lose focus on our restaurant
partners in Westaria. Though we are the market leader currently,
competitors could quickly take advantage if we fail to pay
adequate attention to our stakeholders’ needs and expectations.
We must ensure we have sufficient capacity and resources to
continue serving our restaurant partners at the current level. We
should ensure strong ongoing communications with our key
stakeholders as soon as this strategy becomes public
knowledge, to reassure them that nothing will change in our
current relationships and service
• We must also pay close attention to our shareholders’ reaction
to this strategy. They may be concerned about financial stability
if the company decides to take on large amounts of debt; they
will also be closely monitoring the share price. It may be that…
 56

POTENTIAL SCENARIO

Question Answer
> The board at Snakwheel is considering establishing operations Acceptability (continued):
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with • … the markets will react negatively to this move if they believe
high levels of disposable income, and fast food consumption has that it will cause Snakwheel to “take their eye off the ball” in
increased significantly in recent years. Currently, there is only Westaria. Again, shareholders will need to be assured that
one domestic company offering third party food delivery, and Snakwheel has the financial and resource capacity to
they only operate in Farland’s capital city. Farland has several successfully implement this strategy
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
and outreach campaign, it can hope to become the delivery
platform of choice in Farland within a year, and unlock a huge
market with little competitive resistance.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)

POTENTIAL SCENARIO
Question
> The board at Snakwheel is considering establishing operations
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with
high levels of disposable income, and fast food consumption has
increased significantly in recent years. Currently, there is only
one domestic company offering third party food delivery, and
they only operate in Farland’s capital city. Farland has several
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
and outreach campaign, it can hope to become the delivery
platform of choice in Farland within a year, and unlock a huge
market with little competitive resistance.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)
57
Answer
Feasibility:
• Which brings us to the final consideration: feasibility. Certainly, in
light of our low gearing levels, we have considerable capacity to
take on more debt. Whether funding the move entirely by debt is
the most prudent choice is debatable. Snakwheel has
considerable retained earnings, and so funding it at least in part
internally may be preferable.
• However, financial capacity may be less of a concern than
resource and personnel capacities. Though the board believes
that we can simply “replicate” our current IT system, we must
bear in mind that we did not originally set up our software, but
rather contracted a third party consultancy to adapt an off-the-
shelf solution to our needs. We may need to contract that
consultancy again if we are to establish in Farland, and we
would need to be sure of their availability and capacity to do so.
• Secondly, in order to pursue an “aggressive” marketing
campaign, we will surely need significant ongoing input from our
marketing department…
 58

POTENTIAL SCENARIO

Question Answer
> The board at Snakwheel is considering establishing operations Feasibility (continued):
in Farland, a large country that has seen rapid economic growth
in the last 15 years. Farland has a growing middle class with • … Again, it’s not obvious that we have sufficient capacity to take
high levels of disposable income, and fast food consumption has care of both the Westaria market and the Farland market relying
increased significantly in recent years. Currently, there is only only on our current internal marketing capacity – especially in
one domestic company offering third party food delivery, and light of the fact that Farland is a large country. We may need to
they only operate in Farland’s capital city. Farland has several make several marketing hires to support an aggressive
large urban centres, and so the board believes this presents a
great opportunity for Snakwheel. With an aggressive marketing
campaign, or perhaps contract a marketing agency in Farland
and outreach campaign, it can hope to become the delivery that has better knowledge of the domestic market
platform of choice in Farland within a year, and unlock a huge
market with little competitive resistance.
> Chief Executive Ahmad Farah believes the move should be
funded primarily by debt. Early estimates are that establishing a
presence in the first year will cost around W$750 million. A data
centre will need to be established in Farland, but the board
believes that the IT infrastructure can largely be replicated
> Peter Fodya asks you to prepare a report assessing the
suitability, acceptability and feasibility of this strategy for
Snakwheel ahead of the next board meeting. (sub-task (a) =
50%)
 59

WRAP UP

Closing notes

> We have covered a lot, but not everything

> Technical knowledge is not enough to pass

> You need to apply this information!

Examiner’s feedback

> Try to incorporate information given to you

in the question, and where applicable,
incorporate the pre-seen too

> Application is the key to achieving top

level marks
THANK YOU
Questions: info@vivatuition.com
Questions