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CIMA E3 Exam Actual Questions
E3 Strategic Management (Page 6 )

Updated On: 2-Aug-2026
Page 6 of 36
PDF with 278 Questions

Kaplan and Norton's model of the Balanced Scorecard contains a number of perspectives.  Which of the following are perspectives within Kaplan and Norton's model?
Select ALL that apply.

  1. Financial
  2. Learning and growth
  3. Customer
  4. Procurement
  5. Infrastructure

Answer(s): A,B,C



NNN is a logistics firm that contracts with online retailers (clients) to deliver parcels containing customers' purchases, to customers' home addresses. NNN holds inventory of the most frequently ordered products at its warehouses.
According to industry research, most clients require the contractors to deliver the customers their purchases soon after they place their order. They are not concerned with the environmental impact of the logistics process. They require very competitive delivery prices from their contractors.
Customer research reveals that households dislike being asked to stay at home for an entire day because logistics firms are unwilling to commit themselves to a precise delivery time. This problem has led to a small number of cases of customers arriving at the warehouses of logistics firms demanding to take their purchases away with them. Most households do not consider the environmental policies or performance of the firms they buy from.
The logistics industry is very competitive and NNN wants to protect its existing contracts and to win more. It needs to focus its resources on the 'things that must go right' in order for it to succeed.
Which THREE of the following are Critical Success Factors (CSFs) for NNN?

  1. Business processes that deliver to households at the promised time + or - 15 minutes.
  2. A shorter average time between receipt of an instruction from its client and delivery to the customer.
  3. Warehouses in areas of lowest feasible operating cost.
  4. A car park and waiting room for customers at each warehouse.
  5. A comprehensive policy on emissions and Corporate Social Responsibility (CSR).

Answer(s): B,C,D



Which of the following is NOT an external driver that leads management to adopt greater sustainability in the activities of its business?

  1. Scientific research demonstrating the adverse impacts of global warming.
  2. Increased taxation of the emissions and waste created in industry supply chains.
  3. Customers' concerns, following widespread adverse publicity, over the very low pay of factory labour in manufacturing.
  4. Investor pressure for higher dividends.

Answer(s): D



PPP is a company that designs and markets attractive handsets, tablets, and laptop PCs globally. Its brand is one of the top ten global brands. PPP uses external companies to manufacture its products.
The recently appointed CEO of PPP presented the company's strategy to a meeting of investors and journalists.
The CEO referred to public concerns about its past ways of doing business. He stated that PPP was actively seeking to address concerns about exploitation of workers in the factories of its suppliers. He said that PPP is also establishing a system to recycle or refurbish its products to avoid hazardous materials leaking into the environment and to give recycled products free of charge to people in poorer countries who cannot afford to buy them.
One investor asked the CEO to confirm whether this strategy would improve the profits of PPP in the present financial year. The CEO replied that it would not but that the strategy was essential to protect the future of the PPP brand. The investor was unhappy with this response from the CEO of PPP.
Which of the following statements reflects BOTH the CEO's and investor's stances on Corporate Social Responsibility (CSR) expressed at the meeting?

  1. The CEO is taking a long-term shareholder interest stance. The investor is taking a short-term shareholder interest stance.
  2. The CEO is taking a multiple stakeholder stance. The investor is taking a longer-term shareholder interest stance.
  3. The CEO is taking multiple stakeholder obligation stance. The investor is taking a multiple stakeholder obligation stance.
  4. The CEO is taking a shaper of society stance. The investor is taking a longer-term shareholder interest stance.

Answer(s): A



LMN sells fashion clothing at competitive prices through its own retail stores. The clothes are manufactured for LMN by contractors in other countries.  
In the past 4 years LMN has progressively lost market share to rival shops and online stores. This has been the consequence of poor designs, poor quality, and poor customer service.
In the past 3 years LMN tried to respond to this declining market share in several ways:  
* Used e-sourcing to increase the number of suppliers LMN uses in order to obtain a larger choice of designs.
* Used e-procurement to buy in greater quantities to reduce cost per item.
* Warned each supplier that LMN will use a different supplier unless prices are reduced and better designs provided.
* Closed its own design studio to save costs, relying instead on its suppliers for designs.
* Reallocated budgets away from funding for customer research towards increased advertising.
* Avoided costs of product returns by making it difficult for customers to return items for a refund.
* Cancelled investment in a Customer Relationship Management system (CRM) to use the funds to finance its rising inventories. 
You have been asked to suggest ways to improve the supply chain of LMN. This requires you to make a presentation to the Board of LMN.
Which THREE of the following techniques would improve the supply chain of LMN?

  1. Pull not push
  2. Partnership not antagonism
  3. Customer relationships not transactions
  4. Websites not shops
  5. Make not outsource

Answer(s): A,B,C



JKL is a bank with a large number of personal customers. 
A member of staff has reported their loss of a portable electronic storage device to his line manager.
The portable electronic storage device contains customer account details, including secure information such as personal login details to access personal accounts. JKL has a clear policy that forbids staff from downloading customer data on to portable electronic storage devices. 
It would be difficult for a member of the public to access the information on the device.
Which of the following would you advise JKL to do?

  1. Notify all customers of the loss and advise them to monitor their accounts for unusual transactions.
  2. Wait for customers to query unusual transactions and refund any money they have lost.
  3. Let the staff member explain why they downloaded data before deciding on their dismissal.
  4. Retain the staff member and monitor them secretly to establish whether they are engaged in a fraud.

Answer(s): A



Johnson, Scholes and Whittington developed the SAF framework to explain the factors that should be considered before pursuing a strategic option.
JJJ is a listed company that is considering launching a new product into its market.
Which of the following considerations affects the Acceptability of this new product launch?

  1. The potential impact of the launch of the new product on the profitability of JJJ.
  2. The availability of funds within JJJ for launching the new product.
  3. The amount of production capacity JJJ will require to make the new product.
  4. Whether the product is consistent with the strengths of JJJ.

Answer(s): A



Your management team is considering using Porter's Value Chain to assist it in developing a new competitive strategy for the business.
Which THREE of the following statements would inform your management team about Porter's Value Chain?

  1. It can help understanding of the linkages between business activities.
  2. It can help identify the processes that add customer value.
  3. It can help identify the processes that add costs.
  4. It can help assess competitive pressures in the market.
  5. It can easily import data from existing management accounts.

Answer(s): A,B,C



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