12. Evaluation of strategies and performance measures

Question 1

What model would you use to evaluate strategic options before a strategy is chosen?

Answer 1

SAF
Suitability
Acceptability
Feasibility

Question 2

Suitability

Answer 2

Does it give the company a better fit with the environment

Are there synergies with other parts of the business?

Will it meet objectives of company

Question 3

Acceptability

Answer 3

What risks are involved?

Is the strategy acceptable to stakeholders?

Question 4

Feasibility

Answer 4

Is the time-scale achievable?

Are resources available?

Question 5

Calculations used to measure performance?

Answer 5

Revenue growth
Profits margins
Revenue per store/employee
Divisional performance (ROI and RI)

Question 6

Calculations used to measure positions?

Answer 6

Market share
Average selling price per unit
Revenue growth vs competitor

Question 7

How to calculate return on capital employed?

Answer 7

Operating profits/ Equity + debt x 100%

Question 8

What is the ROCE used for?

Answer 8

Measure how effectively resources are used to generate profit

Question 9

Current ratio

Answer 9

Current assets/current liabilities

Question 10

Quick ratio

Answer 10

Current assets - inventory / current liabilities

Question 11

Gearing ratio

Answer 11

Debt/ Debt + Equity

Question 12

Interest cover

Answer 12

Profit before interest payable/ interest payable

Question 13

AVERAGE Function

Answer 13

AVERAGE(cell range)

Question 14

CORRELATION Function?

Answer 14

CORREL(cell range for array 1, cell range for array 2)

Question 15

COUNTIF Function?

Answer 15

COUNTIF(Range, criteria)

Question 16

What does the countif function do?

Answer 16

Calculates the number of cells in a range that contain specific content

Question 17

COUNTIFS Function?

Answer 17

COUNTIFS(range 1, criteria 1, range 2, criteria 2)

Question 18

IF Function

Answer 18

IF(logical test, value if true, value if false)

Question 19

What does the if function do?