Strategic Planning & Business Model Assessment Flashcards
6 cards from real CTA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Strategic Planning & Business Model Assessment flashcards as text
In a corporate turnaround, what is the first step in strategic assessment before developing a recovery plan?
Answer: Conduct a root cause analysis to determine whether the problems are operational, financial, or strategic in nature
Identifying the true root cause — whether financial, operational, or strategic — determines the entire approach and prevents misallocating resources on the wrong interventions.
A '5 Forces Analysis' in a distressed context helps the turnaround professional assess:
Answer: The structural attractiveness of the industry and whether the core business can be competitive long-term
Porter's 5 Forces assesses industry competitiveness — if structural forces are overwhelming, turnaround may require a business model pivot or exit from the industry.
Which scenario most strongly suggests a business model problem rather than a temporary financial problem?
Answer: Secular decline in customer demand due to technological disruption of the company's core product
Secular demand decline from technological disruption is a structural business model problem requiring strategic reinvention, not just financial restructuring.
A SWOT analysis in a turnaround context is most useful for:
Answer: Identifying internal capabilities that can be leveraged and external opportunities that can support recovery
A SWOT analysis helps the turnaround team understand which core strengths to preserve and which external opportunities are realistic given the company's current position.
When evaluating whether to pursue 'going concern' restructuring versus liquidation, the decisive factor is:
Answer: Whether the going-concern enterprise value exceeds the liquidation value, making reorganization economically rational
If going-concern value exceeds liquidation value, restructuring creates more total value for all stakeholders; if not, liquidation maximizes recoveries.
In strategic turnaround planning, 'core versus non-core' analysis is performed to:
Answer: Identify businesses or assets that can be divested to generate cash and allow management to focus on viable operations
Divesting non-core assets raises cash, reduces complexity, and allows management to concentrate resources on the business units most capable of achieving a sustainable turnaround.