H11SD Developing and Executing Strategy
Scenario for Question 2
By late 2021 a number of particularly governance and financial issues were facing large Chinese companies, including SIPC and its parent company SINOPEC, the state-owned giant.
i. The ‘Belt and Road’ initiative has come under increasing criticism as several overseas national partners faced unsustainable debt levels and possible default on the loans from China.
ii. Debt from large corporations such as at property giant Evergrande is leading to the non-payment of foreign bond holders leading to suspicions of a new financial crisislooming.
iii. Under Xi Jinping, the Communist Party had returned to reminding everyone that the State is the ultimate authority in business as well as politics and has taken steps to assert Party authority with many companies and their leaders with some arrested and tried for corruption. This included some ex-SPIC and SINOPEC executives. In 2018 the charismatic and incredibly popular Jack Ma suddenly and surprisingly stepped down at Alibaba.
iii. Added to these is the need to adapt strategy from a world of very low oil and gas prices especially during the pandemic to world facing highs in prices we haven’t witnessed for some time.
1. Critically diagnose and analyse the current situation facing SIPC (the Sinopec Corporation) using appropriate strategic models. (Total 100 marks)
2. Set out a future strategy for SIPC, considering the scenario presented above, in terms of their strategic intent, the strategic options available and how they might be executed. (Total 100 marks)
3. Understanding sources of capability is a critical area of activity for any strategist. Critically evaluate the process that exists to identify and articulate organisational capabilities, highlighting their strengths and weaknesses. Support your discussion with examples from practice with which you are familiar. (Total 100 marks)
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