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General comments

Overall candidate performance, as measured by the pass rate, was in line with previous sittings. Some candidates produced excellent answers and therefore gained very high marks. However, the fact that a greater proportion of candidates passed by a small margin is a matter for concern. This concern is heightened by the fact that the main reasons for such marginal passes – and indeed failures – have been apparent at previous sittings. These are:

• Too much emphasis on general textbook material, with no link to questions or context.
  For example, some candidates included a discussion on PEST, Five Forces or the Balanced Scorecard in their answers to question 3 on environmental uncertainty. While such tools may be relevant, no marks could be awarded for answers which simply described the tools, but did not relate them to the Ted Baker Group
• Too much emphasis on ratios and lack of attention to Performance Management. Such answers seemed to calculate as many ratios as possible, presumably based on a textbook, and to offer cursory comments on each. This lack of focus meant that answers to questions 1 and 2 were unnecessarily long, leading to answers to question 3, 4 and 5 being curtailed to avoid breaching the word limit. Candidates should note that the mark allocation is directly related to the required volume of answers.
• Lack of analytical comments
  While some marks are available for basic comments, marks will be maximised by developing the answer to provide some analysis. This is most likely to be done by referring to the company’s objectives and strategy.
• Lack of comments justifying choice of ratios and/or CSFs.
  Candidates need to recognise that they must state clearly why a measure is relevant – even if it seems obvious.
• Failure to specify how CSFs should be measured.
  In an assessment such as this, it is insufficient to refer to a measure of performance without specifically identifying how it should be quantified. A common example of this is ‘customer satisfaction’. While it can be argued that this is an important performance indicator for almost any organisation it is often difficult to measure. Marks are always available for clearly stating the basis of a performance measure.

A surprising feature of this sitting was that a number of candidates submitted projects well under the word limit, in some cases less than 2,900 words. It is difficult to develop analysis in such a brief piece of work, and consequently few marks will be gained.

In some cases, there was evidence of a lack of proof reading of the final submission with numerous typographical errors included in scripts. While it is to be expected that such errors may happen on occasions, in some cases the name of the company was incorrect. This indicates a careless approach, and should be avoided.

Specific comments

Question 1

Answers to this question were mostly either very good or weak. Good answers began with the Group’s stated strategy, and sought to use a small number of ratios to assess performance against the stated strategy. Such answers also stated clearly why each ratio was appropriate, by indicating how it measured an important aspect of the Group’s strategy.

Weak answers did not make a clear link between strategy and measures This is a matter of concern as the question stated ‘in the context of the stated strategy’ and the need to place analysis in context was the subject of a recent article in Finance Matters.

Some candidates made a cursory reference to strategy (eg simply quoting the question), but then continued to calculate as many ratios as possible.

Another feature of weak answers was that comments lacked analysis, with a reliance on description – eg how a measure has changed, but no consideration of why this might be, and no attempt to consider if another ratio might provide additional information.

Some candidates included a discussion on the limitations of ratio analysis. This was not asked for, and it is difficult to see why it was included. This may have had some validity if it had been discussed in the context of the Ted Baker Group, and the candidate was attempting to carry out further analysis of the Group’s performance. However in many cases, the comments were general points which could have been lifted from any text book, and were therefore totally irrelevant. Once again, candidates are reminded to answer the question which has been asked, and to ensure their answers are set in the context of the supplementary information.

Question 2

This question required an assessment of potential future performance and how this might be affected by environmental pressures. Some very good answers were produced, with the best answers using the company’s strategic objectives and the key issues identified in question 1 as the basis of discussion.

Some candidates simply relied on reference to historical measures, with little or no analysis of how these might be affected. Such answers did not gain many marks.

Question 3

This question provided an opportunity for candidates to demonstrate the ability to apply material to a specific context. Those candidates who took this opportunity gained more marks.

Where candidates simply described a number of techniques, fewer marks could be awarded. Once again, candidates are reminded of the need to apply, rather than simply regurgitate, theory.

As noted in the general comments, some candidates seem to have started with textbooks, rather than the specific company, when preparing answers to this question. This meant that their answers did not relate to the supplementary information, and therefore did not gain many marks.

Question 4

Many candidates produced thoughtful and well constructed answers to this question which required a discussion of relevant critical success factors. The best answers identified key factors which would lead to the successful rolling out of the Group’s strategy. These answers then went on to explain both the relevance of the measure and the manner in which it should be measured.

Where candidates did not gain marks it tended to be because of the following:

• the list of critical success factors appeared to be a list (again, these may have simply been taken from a textbook without any attempt to assess their relevance to the Ted Baker Group);
• too many factors being listed for them to be realistically regarded as ‘critical’;
• no explanation as to why the factor was considered critical for success;
• no indication as to how the factor should be measured

Question 5

This question required candidates to re-visit material used earlier in the project but to take a different perspective. The key was to link each of the critical success factors identified in question 4 to the changed external environment.

Those candidates who considered in turn each of the CSFs they had identified in question 4, and discussed the relevance of the CSF in the changed environment earned more marks.

However too many candidates simply discussed the environmental factors, with little or no reference to the CSFs. A few candidates completed their discussion of the environmental factors with the brief observation that ‘the factors would remain relevant’ but did not explain why they consider this to be the case. Marks cannot be awarded for such general comments. Candidates are reminded that it is essential to justify any conclusion. This must be done explicitly, and candidates should not assume that the marker will be able to ascertain how a particular conclusion has been reached.

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