CTA Strategic Planning & Business Model Assessment

Question 1

In a corporate turnaround, what is the first step in strategic assessment before developing a recovery plan?

Accepted Answer

Conduct a root cause analysis to determine whether the problems are operational, financial, or strategic in nature

Answer

Identifying the true root cause — whether financial, operational, or strategic — determines the entire approach and prevents misallocating resources on the wrong interventions.

Question 2

A '5 Forces Analysis' in a distressed context helps the turnaround professional assess:

Accepted Answer

The structural attractiveness of the industry and whether the core business can be competitive long-term

Answer

Porter's 5 Forces assesses industry competitiveness — if structural forces are overwhelming, turnaround may require a business model pivot or exit from the industry.

Question 3

Which scenario most strongly suggests a business model problem rather than a temporary financial problem?

Accepted Answer

Secular decline in customer demand due to technological disruption of the company's core product

Answer

Secular demand decline from technological disruption is a structural business model problem requiring strategic reinvention, not just financial restructuring.

Question 4

A SWOT analysis in a turnaround context is most useful for:

Accepted Answer

Identifying internal capabilities that can be leveraged and external opportunities that can support recovery

Answer

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.

Question 5

When evaluating whether to pursue 'going concern' restructuring versus liquidation, the decisive factor is:

Accepted Answer

Whether the going-concern enterprise value exceeds the liquidation value, making reorganization economically rational

Answer

If going-concern value exceeds liquidation value, restructuring creates more total value for all stakeholders; if not, liquidation maximizes recoveries.

CTA - Certified Turnaround Analyst Practice Test

CTA - Certified Turnaround Analyst Practice Test

CTA Strategic Planning & Business Model Assessment