ICAP CA Business Management and Strategy Syllabus

Business Management and Strategy syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Business Management and Strategy in ICAP CA, not a summary of it.

1. 1

   Strategic Analysis

   3 topics

   • External environment analysis (PESTEL)
   • Industry and competitive analysis (Porter)
   • Internal resources and capabilities
2. 2

   Strategic Choice

   2 topics

   • Generic competitive strategies
   • Directions and methods of development
3. 3

   Strategy Implementation

   2 topics

   • Organisational structure and design
   • Change management
4. 4

   Performance Measurement

   3 topics

   • Balanced scorecard
   • Financial and non-financial indicators
   • Benchmarking
5. 5

   Corporate Governance and Ethics

   2 topics

   • Governance structures and board responsibilities
   • Business ethics and corporate social responsibility
6. 6

   Data, Systems and Risk

   3 topics

   • Information systems and digital transformation
   • Enterprise risk management
   • Cybersecurity and data governance

Business Management and Strategy flashcards for ICAP CA

21 of 50 cards from the Business Management and Strategy deck — real questions with worked answers.

1. What does each letter in the PESTEL framework stand for?

   Political, Economic, Social, Technological, Environmental (ecological), and Legal factors of the macro (external) environment.

2. What is the purpose of PESTEL analysis?

   To identify, scan and assess the macro-environmental factors that affect an organisation, helping to understand external opportunities and threats and inform strategic planning.

3. Give two examples each of 'Economic' and 'Social' factors in a PESTEL analysis.

   Economic: interest rates, inflation, exchange rates, economic growth/recession. Social: demographics, lifestyle/cultural trends, education levels, attitudes to work.

4. What are Porter's Five Forces?

   1) Threat of new entrants, 2) Bargaining power of suppliers, 3) Bargaining power of buyers, 4) Threat of substitutes, 5) Competitive rivalry among existing firms.

5. In Porter's model, what makes the bargaining power of buyers HIGH?

   Few large buyers, low switching costs, undifferentiated/standardised products, buyers able to integrate backwards, and the product being a high proportion of buyer's costs.

6. In Porter's Five Forces, what factors raise barriers to entry (reducing threat of new entrants)?

   Economies of scale, high capital requirements, product differentiation/brand loyalty, access to distribution channels, legal/regulatory barriers, and expected retaliation.

7. What is the threat of substitutes in Porter's framework?

   The risk that customers switch to a different product from another industry that meets the same need; it is high when substitutes are cheaper, of similar/better performance, or have low switching costs.

8. What does Porter's Value Chain analyse, and what are its two categories of activities?

   It analyses internal activities that create value/competitive advantage. Primary activities: inbound logistics, operations, outbound logistics, marketing & sales, service. Support activities: firm infrastructure, HR management, technology development, procurement.

9. What is a 'core competence' (Hamel and Prahalad)?

   A distinctive capability or combination of resources/skills that provides competitive advantage, is valuable to customers, and is difficult for competitors to imitate.

10. What criteria must a resource meet to give sustainable competitive advantage (VRIO/VRIN framework)?

    It must be Valuable, Rare, costly/difficult to Imitate, and the organisation must be Organised to exploit it (Non-substitutable in the VRIN version).

11. Distinguish between 'resources' and 'capabilities' (competences) in internal analysis.

    Resources are the assets (tangible and intangible) an organisation owns or controls; capabilities/competences are the ways the organisation deploys and combines those resources to perform activities.

12. What are the three generic competitive strategies in Porter's model?

    1) Cost leadership, 2) Differentiation, and 3) Focus (which can be cost focus or differentiation focus on a narrow segment).

13. What is 'cost leadership' and how does it achieve competitive advantage?

    Becoming the lowest-cost producer in the industry (via economies of scale, efficiency, experience) so the firm can compete on price or earn above-average margins at the average price.

14. What does Porter mean by being 'stuck in the middle'?

    A firm that fails to commit to either cost leadership or differentiation achieves neither low cost nor distinctiveness, leading to below-average performance and competitive disadvantage.

15. What are the four growth directions in Ansoff's matrix?

    Market penetration (existing product/existing market), Product development (new product/existing market), Market development (existing product/new market), Diversification (new product/new market).

16. In Ansoff's matrix, which strategy carries the highest risk and why?

    Diversification, because the firm operates with both new products and new markets, having least existing knowledge/experience of either.

17. What are the three main METHODS of strategic development?

    1) Organic (internal) development, 2) Mergers and acquisitions (M&A), and 3) Strategic alliances/joint ventures.

18. Distinguish between related and unrelated (conglomerate) diversification.

    Related diversification moves into industries linked to the current business (sharing value-chain activities/synergies); unrelated (conglomerate) diversification moves into industries with no obvious connection to existing operations.

19. What is the difference between horizontal and vertical integration?

    Horizontal integration acquires/merges with competitors at the same stage of the value chain; vertical integration moves backward (towards suppliers) or forward (towards customers/distribution) along the supply chain.

20. What are the criteria for evaluating a strategy under the 'Suitability, Acceptability, Feasibility' (SAF/SFA) test?

    Suitability: does it address the situation (environment/capabilities)? Acceptability: are the expected returns, risk and stakeholder reactions acceptable? Feasibility: does the firm have the resources and capabilities to implement it?

21. Name the building blocks (structural configurations) in Mintzberg's organisation.

    Strategic apex, middle line, operating core, technostructure, and support staff (with culture/ideology surrounding them).

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