CIMA OCS May/Aug 2020: ChargeIT

The May and August 2020 pre-seen materials were released and it’s proved to be a groundbreaking day for CIMA.

Firstly, it’s the first set of pre-seen materials released for two exam sittings.

What’s more, CIMA announced, that due to the COVID19 outbreak, the May case study exams will be available for students to take at home!

CIMA will be releasing further details in the coming days.

Anyhow, on to my SWOT analysis of the pre seen materials for the chargeIT OCS exam.

Strengths

Innovation through Research and Development

It’s clear from the outside that the ChargeIT main strength and source of competitive advantage lies with it’s research and development department. This focus has led the company to exploit new technologies in the development of new batteries for it’s products.

ChargeIT are acutely aware of this strength as the pre seen also mentions;

The R&D department is also responsible for the design and
functionality of the electronics used in all of ChargeIT’s products.

This also includes supporting other areas of the business with electronics knowledge and understanding.

The company is keen to pass on this strength across the whole business and ensure all areas have an understanding of electronics.

Weaknesses

The Finance Department

I don’t want to be too critical of the finance department being an accountant myself but it’s clear from the pre seen materials that the finance department SHOULD be contributing more than just day to day operational tasks.

You might also consider this on the flip side and see it as an opportunity to grow the skill set and scope of the finance team. Here is an example of what I mean;

• Budgets are annual “top-down” approach.
• Monthly reporting actual v budget is performed by senior management with no finance team input.
• The finance departments role hasn’t changed since 2001

There is also mention that chargeIT uses a standard absorption costing method – is this ideal for chargeIT?

Remember the OCS exam tends to look at costing system methods, so focus on this area in your studies. Make sure you can explain the different methods and apply it to the chargeIT scenario.

Opportunities

The demand for Robotic technologies

Robotic technologies are everywhere at the moment and given the case study exams now revolve around the 2019 syllabus, it’s always good to be aware of the features and application of new technologies.

To be more specific of the opportunities for chargeIT, this is an extract from the pre-seen;

Robotic vacuum cleaners, whilst still one of the smallest categories, showed strong growth with sale volumes rising by 17.5% in 2019.

Sales of gardening power tools in Eastland increased in 2019 by 3.9% to E$324.4 million whilst sales of lawnmowers contracted by 1.1% to E$356.9 million. Robotic lawnmowers however showed strong growth from E$51.5 million to E$58.9 million.

Simply put, the sales of lawnmowers in Eastland have decreased by 1.1% where as robotic lawnmowers have increased by 16%! Add this to the fact chargeIT have a strong focus on new technologies and R&D there is a strong opportunity here.

Threats

HR Processes and Infrastructure

There are a couple of mentions in the pre-seen materials that chargeIT has experienced rapid growth in the last few years.

While it has done wonders for the revenue and profit numbers, such rapid growth also creates a risk that the company infrastructure is not adequate to keep pace of the business.

Below is the specific threat mentioned in the pre-seen;

Human resources are the responsibility of the HR Manager. The company has expanded rapidly which has created a number of issues in managing human resources.

It has been recognised that there is a need to build new processes for human resource management to ensure the well-being of both existing and new staff.

The positive note here is the fact the company has recognised this risk and there is a need to build and improve HR processes to attract and retain their staff – particularly important if they want to keep their best members of the R&D team – which will in turn main their competitive advantage.

CIMA August 2020 – Astranti OCS Course

I used the full course from Astranti to pass my OCS exam first time in 2015 and have used them ever since.

They have revamped their content for case studies to include even more helpful materials and resources for students taking the OCS exam.