scheduling leading to delays and loss of cargo in addition to excessive debt. These and other issues have badly tarnished the image of the aviation company that once flew as far as Europe. With the increasing number of new entrants, PAA is on the brink of failure. FAA has posted losses for three consecutive years, but the company's negative fortunes continue to worsen jumping from a half year loss of Shs 55 billion in 2013 to Shs 182 billion for the year ended December 2016. \"Whereas the company had a good market share before 2010, continued losses are wiping out investor confidence and are now threatening customer confidence. The airline is borrowing heavily to finance an ambitious expansion plan and this has weighed heavily on its books. Competitor firms on the other hand have opted to consolidate market share given the difficult economic environment that the country has faced since 2011. According to aviation experts. the airline's exclusion from the international aviation network is the key reason why it is struggling, as this denied it the much needed revenue arising from shared booking platforms. However, a counter argument raised is that there are other airlines in Eastern and Southern Africa that were excluded from the same international aviation network but they have continued to operate profitably. Required (a) Assess the drivers for change at Pearl of Africa Airways. (10 marks) (b) With guidance from Weisbord's six box model, conduct an organizational diagnosis for Pearl of Africa Airways. (15 marks) (Total 25 marks) Question 5: Water For All (WFA) is a company that specializes in the supply of piped water to the residents of Kampala. This water is extracted and treated at a location, five miles out of the city centre, on the shores of Lake Victoria. Proximity to the lake, which is one of the largest fresh water bodies in Africa gives WFA unlimited access to a huge volume of water, even though the levels fall significantly during severe drought therefore affecting supply and necessitating rationing. At the plant, the water is treated, purified and tested prior to pumping into the distribution network across the city. in late 2016, concerns were raised in one of the leading newspapers about the quality of water distributed by WFA, but the company quickly dispelled these rumours by Question 1 Deo Kisitu and Jane Kisitu are the proprietors of Kampala Hair Workshop Limited (KHWL). The company was established in 2005 following Deo's retirement from Posta Uganda Limited (PUL). In setting up the company. the proprietors combined both Deo's retirement package and a short term loan from PUL to kick start this retirement dream of self-employment. Deo had been a postman with PUL for over 25 years, and had worked in several departments including marketing. In setting up his own hair dressing company. Deo was fulfilling a long held dream of being a beautician. He was. therefore. joined by his wife as co-director and off they started. Jane had all along been employed by family beauty centre as a beautician. She. therefore. had a wealth of experience for the kind of business they were going into. KHWL not only offers hair dressing services. but other services as well. including manicure. pedicure and facials. It also sells hair accessories such as scissors. brushes, combs. curlers and hair driers. Lately, the company is considering further diversification by introducing body massage. The challenge has been the increased debt burden and the company's imminent failure to meet its debt obligations. As the company expanded operations over the years. KHWL obtained loan facilities to finance its ambitious expansion plans. which saw them open the third outlet in the greater Kampala area. With interest rates on the rise from most of the period 2013 2016. the company has generally struggled to meet its loan repayment obligations in time. Reports indicate that one of the lenders has issued a final demand notice. pending attachment of the directors' personal properties. Matters were further exacerbated by the depreciation of the shilling against the dollar. One of the loans taken out with a defunct commercial bank was a USD 30.000 loan used to pay for imported equipment. With the shilling depreciating against the USD. KHWL is now faced with an increased loan repayment burden. Despite the financial pressures. KHWL is a remarkable entrepreneurship success story by Ugandan standards. However. the company neither has a defined strategic plan nor a clear vision for the future. This may explain the haphazard opening up of outlets that have stretched the company's borrowing limits. Asked about his approach to planning. Deo shrugs his shoulders and says Required: (a) (i) Examine the need for a strategic vision at Kampala Hair Workshop Limited. (6 marks) (ii) Propose a vision for the company. (4 marks) (b) Discuss the relevance of assessing the operating environment at Kampala Hair Workshop Limited. (9 marks) (c) Using the balanced score card as a guiding framework. assess how Kampala Hair Workshop Limited has been able to achieve success. (16 marks) (d) Suggest ways through which Kampala Hair Workshop Limited may improve strategic planning and thereby avoid corporate decline. (15 marks) (Total 50 marks) As a response. the following proposals have been made to management by the human resources manager; Firstly. she recommends a review for the salary scales. She notes that even though staff salaries had been reviewed annually for the previous three years, there was need for a comprehensive review as a motivation ignition. In her view. this together with introduction of over time allowance will be adequate. She also proposes that the staff contracts introduced four years earlier should be reconsidered. Her view is that contractual employment does not promote psychological safety on the part of the staff, therefore not encouraging job commitment. She further proposes that the line supervisors be given the full responsibility to determine who of their staff deserves permanent employment. based on performance results. Secondly she proposes the introduction of daily targets which shall be set by the executive committee and thereafter cascaded to the various staff. Performance statistics will be collected daily, and at the end of the year, the staff shall be given feedback on how well they have performed. Required: (a) Analyse the ways through which the performance management system at UX Holdings Limited can be improved. (10 marks) (b) Examine the relevance of Maslow's hierarchy of needs theory as a tool to improve the staff motivation levels at UX Holdings Limited. (15 marks) (Total 25 marks) Question 4 Pearl of Africa Airways (PAA) is an aviation company listed on the Uganda Securities Exchange. For the second time in three years, PAA was recently reported as having flown a single passenger from Entebbe to Nairobi. Kenya. According to analysts, this is just another indicator of the troubles at PAA. the only Ugandan airlines company that offers international flights. The company's troubles seem to be unending, with regular industrial action by both technical and support staff over salary conflicts with the aviation and tax authorities. These strikes have often affected customer travels as flights have to be rescheduled and in some cases cancelled, leading to costly refunds to customers and public relations damage. Matters are further complicated by the massive internal inefficiency exemplified by high general operating costs. high aircraft maintenance fees, poor flight \"Yes, planning is good, but most of the times those things end on paper. They are meant for office people but they do not work in reality. I have been in this business for a long time and believe me, I know what works and what doesn't. As long as I am able to feed my family, pay fees for the children, then i know there is progress in the right direction.\" On whether he is considering recruitment of professionals, Deo adds that, \"Professionals are good people, but they are also very expensive to maintain. l would rather do things myself. Besides, my wife also sits here with mel For as long as we know when cash comes in and when cash leaves, recruiting professionals is not a priority. " Deo's comments may have some truth in them as the company is run with very few staff. As managing director, he is mainly concerned with the marketing side of the business and financial management. He spends most of his time in the selling role and in customer care, which he rates as a major contributor to the company's success. He is a very good salesman and is also responsible for public relations. He is popular with his clients and much of the business is built on his personal relationship with them. His wife is also an outgoing personality, always accessible to customers and ready to go out of her way to provide a first class service. As the director responsible for administration, she has built excellent relationships with suppliers. and this has enabled the company obtain good credit facilities. Jane is also reSponsibIe for managing the hair stylists, arranging for acquisition of hair dressing materials, hair accessories, their distribution across the outlets and general administration. The low staff numbers may be a blessing with regard to cost control (cost to income ratio is at approximately 30%) but they might also turnout to be the company's undoing. During peak hours, especially over the weekend. some customers have to wait for up to two hours before they can be attended to. This is particularly true of KHWL's outlet located in central Kampala, next to some busy shopping areas. The current financial pressures have not diminished the proprietors' appetite for growth. Deo seems to be even more determined than ever before to push KHWL to the next level, a fact that shows his desire for power and influence as opposed to just profit maximisation. Instead of slowing down and consolidating the achievements given the current economic difficulties, he still insists on further growth by diversifying into massage and health club facilities. He generally questions the ability of the company to continue in its current form and is looking for ideas which may facilitate corporate expansion. He has, therefore, approached you for advice on a number of issues. Required: Assuming the role of the Chief Finance Officer at New Millennium Traders Limited: (a) Conduct an assessment of the company's product portfolio using the product life cycle. (15 marks) (b) Examine the role of marketing in a consumer goods company like NMTL. (10 marks) (Total 25 marks) Question 3 UX Holdings Limited is a leading organization in Uganda's automobile industry, offering a variety of services ranging from motor vehicle service. sale of spare parts and importation of used vehicles. The company's operations have grown quite rapidly in the last five years culminating into the recent tender to conduct motor vehicle technical inspections on behalf of Government. Whereas the company has significantly expanded its market share over the past few years. this is in contrast with the staff mood at the company in the recent past. Staff are not happy with the general work environment inspite of a competitive salary. It is not unusual for staff to be heard grumbling over matters such as excessive workload. absence of recognition from supervisors and management. One staff for example was quoted as having said that \"the increase in new customers and the volume of business. which was not supported by increase in staff had placed strain on the existing employees. Working extra hours with no overtime allowance was no longer tolerable. Alter all, even those that get promoted are not necessarily the best performers.\" Other issues raised by staff relate to performance management. with little or no feedback given to staff on their performance. As a result. the company no longer attracts the best qualified staff while some of the experienced employees with management potential have also left. In an effort to address the issues which are affecting staff motivation. management recently introduced a staff canteen where all employees have lunch together. and also socialize in the evening after work. The human resources manager indicated that the canteen was part of the efforts to appiy proven approaches to staff job satisfaction, as developed by Abraham Maslow in his famous hierarchy of needs theory. lnspite of these initiatives, motivation levels are still evidently low. arguing that several tests are done before water is pumped into the public distribution network. Whereas massive capital has been injected into the distribution network, reports indicate that losses of up to 30% occur during distribution. This was revealed by a financial audit whose findings indicated that of the total volume released at the treatment plant. only 70% was metered at customer consumption locations, therefore indicating wastage during distribution. The other challenge relates to delayed payments by customers. Since the metering is postpaid. with readings taken once a month, many customers have reportedly remained in arrears, therefore denying WFA the badly needed resources. Efforts to collect the monies from some significant debtors. which are mainly state enterprises and/or institutions. have been futile. Management is concerned that the double standards exercised when dealing with state corporations in comparison with the other retail consumers may encourage moral hazard. The above notwithstanding. WFA has placed emphasis on customer service, with new connections now taking only five working days after payment of all required fees. This is as opposed to 14 days as was the practice five years ago. These and other innovations seem to be the results of the organisational restructuring that WFA underwent three years ago. Under this exercise, many of the long serving staff. most of whom had ioined the company without any formal qualifications were laid off. The new team consists of highly qualified engineers and chemists. According to the managing director. whereas significant progress has been registered over the past five years, WFA would significantly benefit from conducting value chain analysis. Required: (a) Examine the role of value chain analysis in improving the operations of WFA. (19 marks) (b) Discuss the potential ethical issues that WFA may encounter in its service delivery. (6 marks) (Total 25 marks) Question 2 New Millennium Traders Limited (NMTL) is a large, consumer goods company dealing in importation of general household consumables. The company's product portifolio includes detergents, stationery (books. pens and pencils). toothpaste and tooth brushes. The detergents have for long been the company's flagship products. with New Millennium soap particularly popular in central. eastern and western Uganda. Insiders at the company indicate that for the past fifteen years. the soap has contributed more than 60% of the company revenue. From 2015 to June 2017. the sales have been declining gradually to a contribution of approximately 40% of the revenue. This decline has been attributed to the entry of other players in the detergent industry, which has increased competition in this market segment. The stationery on the other hand is a wholly new product. introduced in 2016 as a response to the increased market pressure posed by new players. The introduction was also a form of diversification to cushion the company from adverse market changes. The products have. however. been well received in the market. with unconfirmed reports already indicating that New Millennium books and pens are the preferred options for most schools in the country. The rapid rise of New Millennium stationery is partly attributed to the massively successful market entry strategy used by the company, in which best students at the PLE. UCE and UACE examinations were offered advertising deals for the stationery. Toothpaste and toothbrushes on the other hand are performing fairly well in the market. with an estimated 30% contribution to the company's revenues. This notwithstanding. the products face stiff competition from already existing global brands such as Colgate and Nice. At a recent meeting. management discussed the changing market dynamics with a view of devising strategies to enable NMTL to regain a competitive position. especially for its flagship brands. The Chief Finance Officer was subsequently requested to take the lead in conducting an assessment of the company's product portfolio . considering the duration the products have been on offer. The same meeting also considered the need for recruiting a Chief Marketing Officer. but the proponents were unable to explicitly justify the role of marketing in an already established company like NMTL