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Examiner's Approach Interview: P3 - Business Analysis

Examiner's Approach Interview: P3 - Business Analysis






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    Examiner's Approach Interview: P3 - Business Analysis Examiner's Approach Interview: P3 - Business Analysis Document Transcript

    • Examiner’s Approach Interview: P3 - Business Analysis Interviewer: Welcome to the P3 Examiner’s Approach interview. The following is an Examiner’s Approach interview for Paper P3, Business Analysis. The content of this interview has been prepared by the examiner, working with the Qualifications team at ACCA, and is presented by actors representing an interviewer and the examiner in discussion. For more detail on the examiner’s approach, please see the article produced by the examiner in the May 2007 archive edition of student accountant. The P3 examiner is Steve Skidmore. Steve is currently technical director of an international training company. His background is in training, management, business analysis, consultancy and systems development. He was also formerly a principal lecturer at a UK polytechnic. Steve is the author or co-author of several books on information systems and information technology. 1
    • Interviewer: I suppose it would be most appropriate to start off by asking where P3 fits within the overall structure of the ACCA Qualification. Examiner: The Professional Level of the ACCA qualification syllabus is divided into two modules – Essentials and Options, with Essentials coming before Options. Both these modules have been set at an intellectual level equivalent to that expected of a student taking a Masters degree. The focus of the syllabus at the Professional level is to build upon the technical skills already acquired, and to explore more advanced professional techniques, skills and values which are required by the expert accountant acting in an advisory or consultancy role at a senior level. P3 is included as an Essentials paper. It is ‘essential’ that all professional accountants have mastery of this subject before they can qualify as ACCA members. P3 recognises that the accountant may be involved in strategy development and strategy implementation. They may also influence strategy or be asked to evaluate its feasibility. 2
    • Interviewer: From what you have just said, P3 is connected to other papers within the ACCA Qualification. What are the links with other papers, or with other components? Examiner: P3 develops much of the knowledge first examined in F1, Accountant in Business, where an appreciation of business strategy and environmental influences are introduced in the wider business sense. The concept of IT and other information systems are further developed, along with leadership, management and motivational theories. In addition to developing on F1, P3 also draws upon Section E of F7, Financial Reporting ‘Analysing and interpreting accounts’ where such capabilities may be drawn upon in the Section A case study question, or could appear in a Section B question. Some capabilities acquired in P1, Professional Accountant are also applied in P3, for example in Section A6, such as the ethical implications of business analysis, considerations for formulating and implementing strategy, corporate responsibility, and for managing change, including ethical aspects of people management. 3
    • Also, the knowledge and capabilities acquired in P3 may be applied within P5, Advanced Performance Management, which also examines the strategic aspects of organisational performance, and managing and reviewing performance. Finally, knowledge and capabilities acquired in P3 will be applied in context within the Practical Experience Requirements. The relevant Performance Objectives for this paper are Performance Objectives 6, 7, 8 and 9. Interviewer: What is the overall concept or theme for P3 as a paper? Examiner: P3 is a paper which is mainly about analysing a business; where it is currently, where it needs to be in the future and how to get it there. The term ‘business’ here is not restricted to the private sector. Scenarios will include public sector organisations and organisations in the ‘not for profit sector’. Note that the term ‘business analyst’ and the employment of business analysts is common in both of these sectors. P3 is based primarily on the idea that business analysts should be able to assess the strategic position of the organisation, evaluate strategic choices available to it and then determine and implement appropriate strategic action. By this I mean that accountants as 4
    • business analysts could get involved not only in the strategic planning process but are also likely to be responsible for implementing strategy across the business, or within a business area or department. This means that they will need to understand business process change and how IT systems support this, through effective project and people management, using appropriate financial analysis and controls. P3 is concerned, therefore, with both strategy formulation and strategy implementation. The following quote sums up this idea. ‘Strategy without implementation is the slowest route to victory. Implementation without strategy is the noise before defeat.’ This quote explains that both strategy and implementation should go together and that managing a business without the effective management of both is the road to failure. It must be stressed, however, that strategy is not always a top-down process as in the Johnson, Scholes and Wittington ‘design-lens’ model. Strategy may also emerge from business process or IT development, during an operational change management phase. Therefore this quote 5
    • merely confirms that although strategy development can be both ‘top-down’ and ‘middle-up’, successful strategy depends on doing both not trying to achieve one without the other. Interviewer: What are the other broad themes which run through the syllabus? Examiner: Well, P3 is essentially about strategy formulation and its implementation. However within this broad concept are the following themes: Theme 1 is strategy. Here, the syllabus explores how businesses undertake strategy planning from assessing their position to evaluating choices and determining action. Theme 2 is business process where the accountant as implementer of strategy must manage business process change, at the relevant levels, to support the strategic plan. In some cases the accountant may influence strategy from the middle levels of the organisation, through the management of the change process or through systems development. Theme 3 is how the accountant needs to harness information technology, knowledge management and to make effective use of project management to manage business process change effectively. 6
    • Theme 4 recognises that the management of quality control and other issues should underpin all aspects of strategic planning and implementation. Finally, theme 5 is the recognition that strategy formulation or implementation cannot be delivered effectively without adequate resources. In other words, it is necessary to deploy and motivate people properly, evaluate financial implications or constraints and to recognise that resource constraints can often influence the strategic choices available to an organisation. Interviewer: The syllabus for P3 is structured into 9 main sections. Can you briefly explain the main content of these syllabus sections? Examiner: The first three syllabus sections are about strategic planning and very much follow the areas as covered in the 3.5 paper of the old ACCA Professional Scheme. Please note that in syllabus breadth, these three sections cover almost half the syllabus. They cover assessing strategic position, evaluating strategic choices, and determining strategic action. These sections include all the main strategic planning models such as SWOT, PESTEL, Porters Diamond and the Ansoff matrix and so on, but also require the student to learn about marketing, particularly e-marketing. They also require the student to understand a variety of ways of achieving competitive advantage. 7
    • Section D is about business process change and process re-design. This includes considerations around the appraisal of change initiatives using such models as Harmon’s process-strategy matrix, and being aware of the implications of such strategies as outsourcing, including evaluation of software solutions. Section E focuses on how IT can support strategy, mainly around e-business applications, both up and downstream. Section F covers quality issues including quality assurance and quality management systems. Section G covers project management as a vehicle for strategy implementation, including project initiation and the assessment and management of risk. Section H is about financial analysis as it relates to evaluating strategic choices and in determining and implementing strategy. And finally, Section I deals with people and how the successful delivery of strategic objectives requires effective leadership. It is also reliant on the management of performance through formulating appropriate job design, reward management systems and staff development programmes. 8
    • Interviewer: Thank you for explaining the main content of the syllabus for us. What can you tell us about how the exam itself is structured? Examiner: First of all it is worth noting that as P3 is an Essentials paper, all students must sit this exam. As with all papers at the Professional level, the writing time for this exam is three hours. All ACCA three hour papers have been allocated an additional 15 minutes reading and planning time, within which students can read the paper, understand the requirements and choose which questions to answer. An article explaining how this time should be productively used has been published in the student accountant magazine in the August 2007 edition which can be seen on the website. Interviewer: What exactly can students do in reading and planning time? Examiner: They can make notes and plan answers. This may only be done on the question paper and not on the answer booklet. The answer booklet cannot be used until the exam begins. Interviewer: What kind of questions will appear in the exam? Examiner: As P3 is a discursive paper, students will need to be able to understand, analyse and evaluate textual, quantitative and 9
    • financial information and to write professional reports. The requirement, at this level of the syllabus, is for students to be able to use information from case and scenario information and to apply professional judgement in their approach to answering the question, drawing valid conclusions and making appropriate recommendations where necessary. Interviewer: Can you tell us how many questions there are in the exam and what choice, if any, exists? Examiner: As can be seen here, the exam is divided into two sections, A and B. Section A of P3 will contain one 50 mark case study question, in a number of parts. This question can potentially assess any area across the syllabus, and may typically assess capabilities from several sections. These are Sections A, B and C, and Section H – financial analysis. Section B contains three 25 mark questions, which are usually shorter scenarios divided into two or three parts. Each Section B question will normally assess one discrete section of the P3 syllabus, but could in some situations draw from more than one section. 10
    • The student must answer two from three questions from Section B. For more information about the exam itself and how it is structured, there are past papers to refer to, which can be found on the ACCA website. Interviewer: What would you say the key features are of the P3 Exam? Examiner: As I explained, the exam revolves around setting a substantial case study in Section A essentially to examine the first three syllabus sections on strategy position, choice and action. This case study will concern global – and globally understood – industries, including some quantitative information, which will need to be analysed as part of the requirements. Section B will usually assess a discrete subject area from one of the other syllabus sections. These are likely to be shorter scenarios than in Section A, but will still require students to analyse and evaluate verbal information. Interviewer: How should students deal with a requirement that asks the candidate to do something AND something else? Examiner: In P3 where some questions ask the candidate to do more than one thing under the one requirement, the candidate would normally have to use judgement to decide how much effort to 11
    • devote to each aspect, based on cognitive difficulty, for example describe is usually easier than assess. However, in the P3 paper there will usually be a 50/50 split in the marks awarded in such cases or markers will be asked to exercise quite a lot of flexibility in awarding the marks in this situation. Interviewer: What are professional marks? Examiner: Between 4 and 6 professional marks will be awarded within Section A for the form and tone of an answer, for its structure and for the strength and persuasiveness of arguments put forward. There is an article which was published in the October 2007 edition of student accountant explaining what professional marks are awarded for. This article will give more information on the awarding of these marks. Interviewer: And how does the exam assess Ethics? Examiner: Ethics may be examined somewhere in this paper within a business or accounting context, where an ethical dimension connected with strategic planning or implementation may need to be explored. There is also an article on how this is assessed in the September 2007 edition of student accountant. 12
    • Interviewer: What advice would you give about revising effectively for, and passing, P3? Examiner: I would recommend that the key strategy to adopt in the revision phase is to closely revise from the relevant Official Study Text supported by references to Exploring Corporate Strategy by Johnson, Scholes and Whittington. Sections A, B and C of the syllabus have been largely based on this text. This strategy should, however, be supported by practicing questions from past papers, and of course from the pilot paper. Other key tactics to focus on, are developing a good knowledge of global industries in both the private and public sector and gaining awareness of the strategic approaches such organisations take. It is a very good idea for tuition providers and their students to keep abreast of business developments by reading the business press; particularly about real-life case studies such as the airline model used in the first examination. Candidates don’t have to be experts in these global businesses, but some appreciation of the main types of global industries and how they operate will be useful, including broad trends and developments within them. Students need to be comfortable with the application of models or theories to scenarios. They should be looking for ways to explore these (named) models within the information included, including 13
    • any quantitative and financial information which may need to be analysed. Remember, few marks will be available for describing a strategic model such as PESTEL, for example, unless it is applied to some specific case or scenario information. Other tactics to adopt are to ensure that students study across the syllabus and avoid concentrating on one section or sections to the exclusion of other areas. Interviewer: What would your three main examination tips be? Examiner: My first tip is to ensure that you practice thoroughly by tackling exam style questions from the text books, from the pilot paper and P3 past questions as the archive develops. There is no substitute for working through such questions including relevant ones from the old paper 3.5, and possibly the odd question from the old 3.4 from the exam resources archive. Students should pay particular attention to highlighting what they think are the relevant pieces of information using a marker or highlighter pen. It is then possible to use that information to help to make points and to support reasoning. 14
    • Note that published answers to questions may not include some other valid approaches to answering past paper questions, or all the valid points that could be made by candidates. My second tip is to manage and allocate time effectively in the exam itself. I suggest that students should take approximately 25 minutes to read Q1 and make notes. They should then allow 70 minutes to answer that question. In Section B I would recommend allocating 10 minutes to reading and deciding which question to answer, and then 35 minutes per question for writing time. My third tip is to make sure that students strictly apply any information, including making use of any financial information or other data provided, in a relevant way, according to the precise requirements of the question. Interviewer: What do you believe to be the main potential pitfalls in preparing for, and taking, the P3 exam? Examiner: Well at the moment we only have one sitting to go on. However, three main pitfalls emerged from that sitting: The first pitfall is a general lack of preparedness for the exam by many candidates. In December 2007, students hadn’t adequately 15
    • prepared for project management, and were unprepared to discuss quality aspects sufficiently such as Six Sigma in Q4(b). The second main pitfall is poor time allocation within questions, and answering some questions too comprehensively such as in Q1 a) and b) in the December 2007 exam. Remember that only one mark can be awarded per relevant point and no more marks can be awarded than are available for any single part of a question. The third main pitfall is poor or inadequate use of data. Many candidates either fail to use data given in the scenario, such as financial information, to answer the questions, or they take a scattergun approach to answering certain questions through the indiscriminate use of models or theories that they are aware of, in a complicated and unapplied fashion. Interviewer: It is clearly important to follow the above tips and avoid any common pitfalls in exam revision and performance. What further information about student performance would you give which might help students prepare for exams? Examiner: After each examination session, all ACCA examiners are required to produce an exam report. These reports highlight key issues arising in the last exam and focus on where students performed 16
    • particularly well or badly. These are published in February and August and can be found under paper resources for each paper which can be accessed through the website. In addition, after each exam session has been completed, the exam review board meets. This is a board consisting of ACCA internal Education staff and six representative members of the approved learning partner community. Minutes from this board summarise the comments made by tuition provider representatives, report survey results about the exams from student questionnaires and detail the responses. Again, the minutes from the exam review board are available on the website. Interviewer: And finally, what would be your concluding advice about the P3 examination paper? Examiner: Firstly, students must always read the question as carefully as they can; identifying clearly the instructional verbs contained within each requirement. Second, it is important to properly understand the requirements, assessing how much the examiner is really looking for in each question part. Students should also be fully aware of the marks available for each requirement. 17
    • And finally, don’t forget that answers given should relate to the question actually asked, not the one that a candidate would have liked to answer! Interviewer: Thank you very much for sharing your insight into this exam paper. I’m sure it has given students and tutors lots of useful information. Examiner: Thank you. 18