Expert advice: how to pass the final Man Case Study exam on 2015 syllabus
Preparing for the Case Study Exam can be an overwhelming task for any student, that is why we recently sat down with one of our Management Case Study lecturers, Precious Nyamazana, and had an interesting chat on the upcoming Case Study exam. As one of our best Case Study lecturers Precious knows how to prepare students for exam success. Here are her thoughts.
The pre-seen – Overview
The GSC business is exciting as it is something that we can all relate with. Following health issues that have been looming up of late, people have been developing a keen interest to participate in various sport and fitness activities. GSC is a global business which designs, markets and sells high-performance branded sportswear which includes clothing, footwear and accessories. The business has experienced growth though the industry has fierce competition. GSC is based in North America, which is a highly developed economy.
Some of the industry real players that came to mind when I read the pre-seen are Nike, Adidas, Puma, Reebok etc. It would be useful to gather basic knowledge regarding their processes. GSC is operating in a complex industry where consumer trends are constantly changing. GSC outsources the manufacturing function to a small number of specialist third-party fabric suppliers though these also deal with GSC’s competitors.
Technical skills you should polish up on before the exam
Do you recall which tools to employ in appraising GSC – PEST analysis; Porter’s Five Forces; Porter’s Diamond, etc.?
• The 2020 aims which were provided in the pre-seen material specifically mentioned product and market development. It would thus seem appropriate to think alongside Ansoff’s Matrix for strategy development as well as other strategic options for growth.
• GSC seems to be following Porter’s generic strategy – differentiation focus. Are you familiar with this concept?
• Growth of four percent is good but not spectacular – what is the Industry lifecycle like?
• Fierce competition – do you know how to conduct a competitor analysis?
• GSC is a global business. Think of globalisation – interdependence between countries in terms of labor, raw materials, finance etc.
• Geoland requires that financial statements be prepared in accordance with the IFRS. Do you know how to initially recognize and subsequently measure the elements of the SOFP items presented in the pre-seen? How about accounting for development costs, consolidation techniques, foreign subsidiaries etc.?
• What sources of long-term finance does GSC currently have? What else could be recommended to this company?
• Risk management e.g. currency risk
• Investment appraisal – new projects
• Project management
• Inventory management
• Borrowings increased yet GSC paid dividends. Did they borrow to pay out dividends?
• High quality usually amounts to high production costs hence there is a real need to control costs. What techniques can be employed to achieve this? Target costing and value chain optimization too.
• GSC focuses on quality, high-performance sportswear. Do you recall the principles of Total Quality Management (TQM)?
• Transfer pricing between nations or departments?
• To translate the mission and objectives into measurable aspects there is need for performance measurement. Do you recall the Balanced Scorecard and how it works?
• The issue of the code of conduct was emphasized. Be up to speed with issues of fair practices, values, culture and communication.
• Stakeholder Analysis – Mendelow’s Matrix.
• Budgets and variances were mentioned in the pre-seen. Do you know what budgeting is, how to flex a budget? How about the concept of Beyond Budgeting?
• No competitor financial information has been provided – be ready to be provided with financial analysis on the day and a request to compare the financial performance and position of GSC with one of its competitors. Do you know how to analyse financial ratios?
• Have you preformed the financial analysis for GSC? Is GSC improving or it’s deteriorating in terms of financial position & performance?
Areas you should focus on
• Critical success factors for GSC for example, supply chain management, latest technology and trends, cost control, high quality, brand image for premium pricing
• GSC could consider opening its own stores just like its competitors given that the bulk of its revenue is currently through retail partners. This could help reduce commission expenses.
• Increase website sales as people are becoming comfortable with online purchases and this could further drive down costs.
What problems does the GSC face?
• Corporate Governance issues given that GSC is listed on the stock exchange – no mention of NEDS and remuneration, nomination or audit committees.
• Ethics & CSR – distribution channels – delivery trucks – environmental footprint. Ethics questions usually feature a lot – know the CIMA code of ethics and stick to it when answering such questions. Do not merely state it but explain its elements with relevant application to the scenario provided.
• Limited patent protection on some of the fabrics and technology used in the manufacturing of its products.
Any general advice?
• Business leaders are more interested in solutions to their problems rather than how much knowledge you have. As such, aim to apply your technical knowledge in a relevant fashion.
• It is also advisable to you conduct a basic industry analysis on the sportswear industry as a way of understanding the wider business context. This is key in that you can easily identify the grey areas that are bound to arise in the unseen material on the exam day. It also makes it easier for you to illustrate and apply your theoretical knowledge by making relevant examples.
• Remember it’s all about balancing the four competence areas – people, business, leadership and technical skills. You need to show moderate to strong competence in all these areas. Your proficiency in one competence area will not compensate for your ignorance in another competence area. This comes through question practice.
• Make use of the exam technique T-I-P-S: time management, identifying ALL task requirements, planning your answer and speaking to your audience.
How IBTC can help you prepare for your case study exam:
Exam Prep Classes for the November sitting begin on 19 October for Sandton and Cape Town. To sign up go to www.ibtc.co.za and click on the book now button and secure a seat in one of our classrooms