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CIMA E2 Project and Relationship Management Exam Practice Test

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Total 210 questions

Project and Relationship Management Questions and Answers

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Question 1

What are the disadvantages of a divisional organisational structure? Select ALL that apply.

Options:

A.

Knowledge may not be shored between different divisions

B.

Divisions may end up competing with each other

C.

Potential duplication of activities may occur

D.

There may be a lack of specialisation on a particular product

E.

It con be difficult to undertake expansion in the form of new divisions

F.

It is difficult to develop managers due to a lack of responsibility in their roles

Question 2

Q is a manager planning to introduce new workflow technology into a busy office environment. Q knows this will impact the work pattern of everyone in the office and is very concerned about the potential reaction from staff and how best to manage the change process.

 

Q decides to document all possible factors and concerns. A list of all the positive factors in favour of change is made in one column, and all the factors against the change in another column. This analysis will enable Q to decide how best to reduce the strength of the factors opposing the change, and/or increase the strength of the factors in favour.

 

Select the approach that Q is adopting.

Options:

A.

Force field analysis

B.

Incremental change

C.

Transformational development

D.

Stakeholder analysis

Question 3

Which THREE of the following are determinants of national competitive advantage outlined in Porter's Diamond?

Options:

A.

Demand Conditions

B.

Factor Conditions

C.

Related and Competitive Industries

D.

Firm, Strategy, Structure and Rivalry

E.

Firm Infrastructure

F.

Technology Development

Question 4

With reference to Herzberg's motivation-hygiene concept (two-factor theory) relating to employee motivation, which of the following is a correct interpretation of his findings?

Options:

A.

The presence of hygiene factors are necessary in the workplace to prevent dissatisfaction.

B.

The absence of hygiene factors will inspire employees and improve motivation.

C.

The absence of hygiene factors will provide a better work environment and motivate employees.

D.

The presence of hygiene factors will increase employee morale and motivation.

Question 5

The Managing Director of a large golf complex is using Drucker's five questions to help develop a new strategy.

Which of the following statements does not answer one of Drucker's questions?

Options:

A.

We will analyse the local market to ensure we are the best.

B.

We will offer state of the art facilities at affordable prices.

C.

We will target the fifty years plus demographic.

D.

We will utilise our knowledge in an attempt to improve our members golf skills and enjoyment of the sport.

E.

We will grow our revenues by 50% over the next three years.

F.

We will aim to constantly improve and update our course and the accompanying facilities.

Question 6

X is a Project Manager who works in a matrix organisational structure with an authoritarian leadership style. Team members are seconded on a part-time basis to teams led by X, who will then contribute to their individual performance appraisals at the end of each year.

 

X requires all team members to follow exactly what he tells them without question because he has the authority to provide negative feedback in their performance appraisals. According to the French and Raven model, select the type of power that X is using in these circumstances.

Options:

A.

Coercive

B.

Reward

C.

Referent

D.

Feedback

Question 7

There are several techniques that can be used when planning a project. Which of the following best describes a Work Breakdown Structure?

Options:

A.

A technique which can be used with critical path analysis to deal with uncertainties and risk within the project.

B.

A set of documents identifying each stage and task to be performed during development, defining a hierarchy of work prior to the allocation of tasks.

C.

A method of scheduling tasks using a chart on which bars represents the relative length of the task.

D.

A technique to arrange activities required to achieve the project objective, agreeing the objectives and determining exactly  the project aims.

Question 8

A fundamental concept of the successful use of a Balanced Scorecard is:

Options:

A.

to continually increase the number of performance indicators used to manage the business.

B.

to sometimes use a traffic light system to help prioritise activities in the scorecard.

C.

to see the scorecard as a technique for formulating strategy.

D.

to ensure that the scorecard consists of leading indicators of performance only.

Question 9

As part of a project to refurbish a large hotel chain, the wiring of the computer network was subcontracted to a specialist IT organisation. In relation to managing risk in the project this approach can be referred to as:

Options:

A.

Reduce

B.

Avoid

C.

Transfer

D.

Accept

Question 10

Every project has constraints. When running a project it is critical that the constraints are known.

 

What are the primary constraints in a project?

Options:

A.

Need, Solution & Implement

B.

Initiate, Plan, Execute, Control & Complete

C.

Define, Design & Develop

D.

Time, Cost & Quality

Question 11

Drawbacks of the formal top-down approach to strategy include which THREE of the following?

Options:

A.

It is too infrequent, typically every three to five years, to allow the business to adapt to changes in the business environment.

B.

Even when a firm is involved in a range of industries and has a unique core competence, there is no guarantee of competitive advantage against more focused players.

C.

The approach assumes that the strategist is able to make reliable assumptions about the future but as critics point out, this is not always possible.

D.

Organisations need to be continuously monitoring their marketplace to ensure that their core competences are still providing a competitive advantage.

E.

The formality of the approach constrains the development of radical innovative strategies. 

Question 12

A company has used the Boston Consulting Group (BCG) matrix to plot the position of its products according to their relative market share and the growth of the market.

 

It has identified that it has several products under the heading of star.

 

Which of the following best describes its likely cash position? 

Options:

A.

Cash rich

B.

Cash neutral

C.

Cash negative

D.

This model doesn't consider the cash position

Question 13

The balanced scorecard involves creating a set of measures for which THREE of the following perspectives?

Options:

A.

Financial: How should we appear to our shareholders?

B.

Learning and Growth: To achieve our vision, how will we sustain our ability to change and improve?

C.

Quality: How do we improve our product and service quality to outpace the competition?

D.

Customers: To achieve our vision, how should we appear to our customers?

E.

Productivity: How do we improve our rate of output to satisfy all our stakeholders?

Question 14

A business manufacturing running trainers is considering exporting to a fast growing Asian market. Using Porter's Five Forces, which of the following statements is most likely to be incorrect?

Options:

A.

Supplier power is likely to be high

B.

Competitive rivalry is likely to be high

C.

New entrants are likely to be low

D.

Substitutes are likely to be high

Question 15

Based on the Tuckman model of team development, identify the stage when team relationships should start to harmonise and the team agrees on normal work patterns and the best way to tackle the work ahead of them. Job roles and relationships within the team are also agreed.

Options:

A.

Norming

B.

Storming

C.

Forming

D.

Performing

Question 16

Conflict has heightened between the departments of a textile manufacturer, following a recent decision by the manager of the cloth inspection department to a tightening up of the inspection standards. She insists that the quality of output has to improve if the organisation is to remain competitive.

 

This has resulted in some staff being idle more frequently and the sight of this idle time has frustrated the management and other employees in the weaving department, due to the direct link between time and bonus payments.

 

Using the Thomas-Kilman Conflict Mode Instrument, which of the following would be the most appropriate method of resolving the conflict in this situation?

Options:

A.

Competing

B.

Collaborating

C.

Avoiding

D.

Accommodating

Question 17

According to Hofstede (1990) a company that values tradition, education and training is said to have which of the following cultural dimensions?

Options:

A.

Collectivism

B.

Feminine orientation

C.

Long term orientation

D.

Low power distance

Question 18

A company displaying creativity in its workforce, and an ability to react to the dynamic environment in which it operates, is most likely to avoid which of the approaches to strategy formulation listed below?

Options:

A.

Emergent

B.

Freewheeling opportunism

C.

Rational

D.

Incremental

Question 19

Four orthopaedic surgeons in a busy hospital department have very different work habits. Each has their own team of medical technicians who are used to the surgeons' personal preferences and are very comfortable with their routines; they basically do the same things every day. This way of working has gone on for several years.

 

When a new administration manager suggested that they train all of the technicians to work with all the surgeons this led to significant resistance from all of the parties involved. The technicians were concerned that they would no longer be able to perform their usual daily tasks.

 

On the basis of the scenario what would be the main cause of their resistance?

Options:

A.

The technicians' fear that they would be forced out of their regular habits.

B.

The technicians' concern over personal loss such as benefits and privileges.

C.

The technicians' fear that the changes proposed would harm the efficiency of the department.

D.

The technicians' belief that role ambiguity and uncertainty would increase. 

Question 20

KK manufactures mobile phones and it possesses an inimitable resource in the mobile phone market in which it currently competes.

Which of the following  best describes this type of resource?

Options:

A.

It will provide wide access to a variety of markets

B.

A competitor will see the perceived benefits

C.

A competitor will find it difficult to copy

D.

A competitor could substitute the resource

Question 21

Which of the following represents the three steps from Lewin's three-step model?

Options:

A.

Unfreeze, move, refreeze

B.

Assess, negotiate, collaborate

C.

Review, change, implement

D.

Design, implement, review

Question 22

Hersey and Blanchard developed a theory of situational leadership which suggested that successful leaders should change their leadership style according to the maturity of the subordinates they are leading. This includes an assessment of their professional ability and their readiness to undertake set tasks.

 

Based on this theory, which leadership style would be best suited to a subordinate showing the highest levels of maturity, readiness, ability and willingness to tackle the work available?

Options:

A.

Delegating

B.

Telling

C.

Selling

D.

Participating

Question 23

The advantages of embedding the finance function within the business unit include which THREE of the following?

Options:

A.

It allows the accountant to provide information specific to a particular business unit with greater efficiency.

B.

It prevents duplication of effort across the organisation.

C.

It enables strong relationships to be developed between the accountant and the rest of the management team within a particular business unit.

D.

It means that the accountant is able to develop best practice that can be of benefit to the whole company.

E.

It allows the accountant to build up detailed local knowledge and understanding of the business unit.

Question 24

The purpose of PEST analysis is described by which of the following?

Options:

A.

To examine the competitive forces at work in the industry.

B.

To determine the strengths and weaknesses of the organisation.

C.

To assess the power of the internal stakeholders.

D.

To assess the threats and opportunities posed by the wider environmental forces.

Question 25

The Board of organisation Y has authorised an upgrade to its computerised finance system.

 

The Finance Director, X, has been tasked with managing this project.  X has been requested to consult with stakeholders, in order that a Project Initiation Document (PID) may be produced.

 

What are the TWO main uses of a PID?

Options:

A.

To ensure that the project is broken down into work packages and a Work Breakdown Structure be produced.

B.

To produce a risk assessment of both internal and external risks that are likely to effect the project, and alternative actions to reduce the risks.

C.

To ensure that the project has a complete sound basis before any major commitment to the project.

D.

To act as a base document against which the project can be managed for progress, change management issues, and ongoing viability issues.

Question 26

DD organisation is a management consultancy company. Currently, although it has some clients in other countries, the activities of DD are mainly domestic. However the directors are keen to develop the business internationally.

 

The strengths of DD are recognised as it has a well-motivated team of professional consultants, and a very powerful analytical model for developing business solutions.

 

Which of the following best describes how this company can develop its business strategy to gain a competitive advantage?

Options:

A.

Competitive advantage can be gained by having a resource based view that stem from having unique assets and core competencies.

B.

Competitive advantage can be gained by carrying out a PEST analysis.

C.

Competitive advantage can be gained by using the BCG model.

D.

Competitive advantage can be gained from allowing strategies to emerge.

Question 27

The role of competitor analysis, according to Wilson and Gilligan is threefold.

 

Which of the following does NOT apply?

Options:

A.

To generate insights into competitors' past, present and future strategies.

B.

To provide in-depth understanding about customer preferences which can aid product development and marketing strategies.

C.

To help management understand their competitive advantages and disadvantages relative to competitors.

D.

To give an informed basis for developing future strategies to sustain or establish advantages over competitors.

Question 28

Which of the models below identifies triggers for change from the macro environment?

Options:

A.

Michael Porter's Five Forces

B.

Michael Porter's Diamond

C.

LoNGPEST

D.

Ansoff's Growth Matrix

Question 29

AW is a newly appointed manager of the accounts department in organisation S.  Her appointment has been well received by members of the department who recognise AW as a skilled and well qualified accountant.

 

However, AW has been frustrated by progress in departmental team meetings which tend to be unruly, unproductive and disorganised.  AW recognises a need to improve the effectiveness of the meetings.

 

Which THREE actions should AW take in order to have more effective meetings?

Options:

A.

Produce an agenda at the meeting

B.

Determine the purpose of the meeting

C.

Publish lengthy and detailed minutes

D.

Manage the plan of action

E.

Establish who should attend

F.

Allow attendees to talk through issues with each other independent of the chairperson

Question 30

An organisation manufacturing cosmetics was set up five years ago and has since grown considerably.

 

The organisation did not have clear strategies and as such any approaches emerged. The directors feel a new way to strategy setting would be more appropriate; one that could offer a more thorough, intended, deliberate approach.

 

Which of the following is a suitable approach to developing strategy for this organisation?

Options:

A.

Rational Strategy

B.

Resource based strategy

C.

Emergent strategy

D.

Shareholder strategy

Question 31

Which of the following best describes the purpose of Michael Porter's Five Forces model?

Options:

A.

To examine the macro environment to identify any triggers for change.

B.

To examine the internal environment to identify the strengths and weaknessness of the business which can be used to gain competitive advantage.

C.

To indentify the profit potential from the industry to determine whether to enter or remain in the industry.

D.

To analyse the stakeholders of the business and their power and interest in order to manage them effectively.

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Total 210 questions