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NEW QUESTION: 1
Scenario
Additional Information
During the initiation stage the Project Manager met with the Marketing Director to find out more about the requirements of the promotional calendar and recorded the following notes:
There has been a reduction in the order numbers at the MNO Manufacturing due in part to the increased marketing activities of its competitors. 10% of customers have not re-ordered in this financial year and staff morale is poor. A number of skilled staff have left as a result and replacement staff have not been recruited due to the reduced operation. If the project is successful, a recruitment campaign will be required to fill the existing staff vacancies and there may be a requirement for additional staff. Operational costs are likely to increase because skilled staff are expensive and difficult to find.
In financial terms, there were a total of 1,500 orders in the last financial year, each with an average profit of £2k. The Marketing department believes that sending a promotional calendar to our current and prospective customers would increase orders by at least 10% with a minimum of 10 further orders from the list of prospective customers within 12 months from the date of distribution.
The Marketing Director will be funding the project from the business marketing budget. She believes that the effect of a good company image portrayed by a successful calendar would last into a second year. She has forecast the same increase in orders for a second year and predicts that the annual employee satisfaction survey will show a measurable improvement in staff morale.
A number of alternatives were explored, including:
20% discount for all repeat customers - not cost-effective and very short term

A promotional calendar as a free Christmas gift - would target current and prospective customers and

the benefits would last into a second year
A series of television and press advertisements was too expensive

A direct mail shot to all customers - benefit would be short term

Creation of an internet website - would not suit all customers

The calendar is seen as the favored option, as long as the company's competitors do not increase their marketing activity. Whilst the Marketing department wants a very high quality, glossy product, the project management team must be aware of the cost this will incur.
Which 2 statements should be recorded under the Expected dis-benefits heading?
A. The calendar may not result in the expected 10% increase in orders.
B. The calendar may not result in the 10 further orders from the list of prospective customers in 12 months.
C. Individuals in the engineering team who are not selected to appear in the calendar photographs will become de-motivated.
D. Because the Calendar project is a priority for the MNO Manufacturing Company, the delivery of other projects within the Marketing department will be delayed.
E. A high quality, glossy product will involve additional costs.
Answer: C,D

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