For More Papers Visit http://www.IGNOUGuess.com IGNOU Papers -IGNOU Forum – IGNOU Articles @IGNOUGuess.com COMMANWEALTH EXECUTIVE MBA /MPA PROGRAMME Term – End Examination June, 2007 SC – 3: STRATEGIC MANAGEMENT Time: 3 hours Maximum Marks: 100 (weightage: 70%) Note: This question paper has two parts, A and B. Part A contains theory questions (60 marks). Part B is compulsory and carries 40 marks. PART A Attempt any three questions. Each question carries 20 marks. 1. Discuss the importance of the Mission and Vision statements in organizations. What happens when there is a clash between the two? Illustrate with reference to specific examples from the corporate world. 2. Discuss the strategies of "Product Differentiation". Bring into light the sustainability of it in the present context. 3. Discuss prescriptive view and the schools of thought it has to explain the concept of Strategic Management. 4. Explain the role of planning and performance in managing the Strategy cycle. 5. Write short notes on any two, bringing out clearly the differences between them: (a) Penetration Vs Product Development (b) Strategy and change Vs Strategy and planning horizon (c) Strategy Vs Tactics (d) Product Life Cycle Vs Industry Life Cycle PART B 6. Read the case below and answer the questions given at the end. HOT SHOT; SHARP SHOOTING For More Papers Visit http://www.IGNOUGuess.com IGNOU Papers -IGNOU Forum – IGNOU Articles @IGNOUGuess.com Fazalbhoy was confused. As he looked out of his 18th floor penthouse of the NCPA building on Marine Drive, he knew that while Hot Shot was one of the most popular brands in' the market, it was his brainchiild yet he was under tremendous pressure to close down the brand. Success it seemed, was not without its price. His family business, Photophone India Ltd., made and marketed motion picture reproduction paraphernalia like cinema projectors. It was also an agent for products like communication electronics plus cameras and recording equipment for the motion picture production. By the mid-'70s, however, the company detected the first signs of a deceleration in the cinema business and anticipated that a boom in TV and later, video, was inevitable. The Fazalbhoys saw themselves being in the imaging business and decided to diversify within it. Abdullah, fresh from Wharton Business School, US, looked at compact or personal use cameras as a promising possibility. The market research was disappointing. Photography as a hobby had a poor following. If was regarded as complicated, time consuming and worst of all, expensive. Few people knew anything about it, fewer still indulged in it. People were intimidated by the technical jargon that came with cameras. The only serious player in the market, Agfa, sold just about a lakh pieces. It manufactured only 120 mm formal box cameras, priced between Rs. 120 -200. Black and white photography Predominated. It was a rare lab that would develop color film and that would take weeks, if not months. Color prints were expensive, about Rs. 6 per print. Photophone decided to introduce the 110 mm model in a market made up of ill-informed consumers, reasoned marketers. The camera would be simple to operate and yet deliver good quality. If the fact that it could be used by the most photography-illiterate could be well brought out, this would allay the potential user's fears and invite him to try it. Photophone had to be careful not to use technical mumbo jumbo. It had to tell the consumer what to do, and not what the product could do! And the product had to deliver in a market where confidence in an Indian make was pathetically low. The 110EF model was scheduled for launch in March 1983 and Sista's was appointed the agency to create a brand that would be attractive, inviting, friendly and "unlndian". The name "Hot Shot" best conveyed what the product was : and would make the user feel modern, smart, a hot shot ! The advertising wanted to do two things : make photography seem easy and make the user feel trendy and "with it". A presentation (or introductory) film was followed by a montage film of fun sequences. The commercial went, "l'm a Hot Shot lady, I'm a Hot Shot guy...", targeting every conceivable Sunday photographer: housewives and For More Papers Visit http://www.IGNOUGuess.com IGNOU Papers -IGNOU Forum – IGNOU Articles @IGNOUGuess.com youngsters, fathers and mothers. So simple that anyone can use it, was the message. The base line: "Just aim and shoot". The agency developed what is considered one of the best onomatopoeic mnemonics in Indian advertising. "Khatak" said the model, as she clicked. Hot Shot promoted color photography in a predominantly ,black and white market which suddenly came alive. Cameras can use both black & white and color rolls -a fact most people were unaware of. Hot Shot positioned itself as the "colour" camera, as opposed to the boring, staid, black & "white ones available until then. It thus succeeded in creating both an aura and excitement around the brand. To ensure the supply side, Photophone also tied up with 3M of Italy to acquire and market 1 10 mm film in India. Within two years, Photophone introduced its own brand of film, piccolo. The years following the introduction of the camera was a marketing fantasy : cameras were being picked up as fast as they could be made. Film roll sales too shot up. Color processing labs mushroomed, with even businessmen in dry fruit trading and hoteliering being tempted into this area. Labs, which gave consumers prints after a month or two, began delivering faster. Costs of a color print also crashed. By September 1983, close to the festive season, the 35 mm model, 35 UF, was launched. By February 1984, the company had sold over a lakh pieces. Many other companies started to view the market. Realizing that it could not afford to rest on its laurels, Photophone decided to flood the market with models to plug niches which didn't even seem to exist. In the following four years the company introduced 10 models. All of them sold well when launched, though the biggest grossers were the 35 UF' and the 110 EF, both of which came with a built-in flash. Other models like the 35 JR, sans flash but with a hot shoe to fit on one, did all right. Tele 110, as the name suggests, came with a tele-lens. A cute, red Sizzler also came without a flash. To cover a wide price range, the company introduced cheaper models to initiate people into Photography. The Hot Shot Le Spy, a 110 mm mini with a flash was available for Rs. 280. Even more economical was the Hot Shot Mini (it was basically Le Spy without a flash) : at Rs. 65 it cost less than a film roll. Competition came soon. Around 1986, Agfa introduced its own 35 mm model, Snapper. In 1989, the Indian Photographic Co. launched its Kodak Kroma 35 mm. Photophone countered by introducing its Minolta version, but the model proved too expensive at Rs. 3,500 and was discontinued. By 1992, the t 10 mm format cameras were virtually phased out as they had become obsolete worldwide. Sales of Hot Shot and Other Cameras, Industry Figures For More Papers Visit http://www.IGNOUGuess.com IGNOU Papers -IGNOU Forum – IGNOU Articles @IGNOUGuess.com Though Hot Shot was even today mentioned as one of the best examples of an early product success, Fazalbhoy was unsure of how the Board would react. This had something to do with the fact that though the company is best known for Hot Shot, a littleknnow is the fact that the camera business accounts for' just about 5 per cent of Photophone's sales. As for the company that launched a brand that won every conceivable advertising award around launch time, Hot Shot has done a lot for it in terms of a rub-off. It was the Hot Shot magic which resulted in the company's share issue in 1985 being oversubscribed 1 19 times. And, also in Photophone being featured in Fortune Magazine along with industrial giants when its turnover was just Rs. 15 crore. Photophone had created history. But would Hot Shot soon become history too? Questions (a) Comment on the strategic options available to Hot Shot. What generic strategy (Porter) should PMT follow? (b) Conduct a Five Forces model exercise for Hot Shot in this situation. What do the results tell us about the current position in the PLC that HS is facing? (c) What are the options that you would like to suggest from the viewpoint of Photophone?