Instructions

Read the following scenario and answer the THREE questions that follow.

Comprehension:
TrueColor, an event management company in eastern India, had been in a business of inviting Tollywood singers to a city called Tivanna, and made money out of selling tickets of their concerts. The stars were paid a fixed fee regardless of the number of tickets sold. The company had a specialized team that negotiated the singers’ fee with their managers. However, for selling the tickets of such events, they were reliant on an external media agency called Zedius. Zedius had a long-standing relationship with TrueColor, and had been instrumental in achieving a target of 50,000 tickets for each of the flagship events.

Mr. Sukanta Rao joined TrueColor as an inhouse sales and marketing manager, a position exclusively created for him. The CEO, Mr. Adil Banerjee, had assigned a task of increasing the sales of tickets to 100,000. In Sukanta’s earlier stint, he had seen that similar cities sell more than 75,000 tickets for such events. He felt that, over time, reaching 100,000 was plausible for TrueColor.

Question 41

Sukanta felt that the aspirational target can be achieved only if Zedius is replaced. However, he is not sure if he should make any major changes in his first year.

Which of the following reasons will BEST help Sukanta NOT to start making major changes immediately?

Solution

Option C is the correct answer because Sukanta is new to TrueColor and the eastern market dynamics. Making major changes without fully understanding the local market and the nuances of how Zedius operates could lead to disruption or failure. Taking time to analyze the competitive landscape, customer preferences, and Zedius's current performance would provide Sukanta with the insights necessary to make informed decisions in the future. This approach also allows him to build trust with the team and gather data to support any major changes he may propose later. By not rushing into a decision, Sukanta ensures a smoother transition if changes are eventually required. This reasoning aligns with the principle of risk mitigation and cautious decision-making in a new role.

Option A: This option is incorrect because while Zedius’s long-standing relationship with TrueColor indicates their experience and familiarity with the company’s needs, it does not provide a strong enough reason for Sukanta to avoid making changes. The fact that Zedius has been managing marketing for five years is more of a descriptive fact than a justification to delay decisions. The decision to not make immediate changes should be based on Sukanta's need to assess the market and gather relevant data, not merely on Zedius's history with the company.

Option B: This option is incorrect because the reputation of Zedius’s owners, while noteworthy, does not necessarily reflect the effectiveness of their operations or their ability to meet TrueColor’s growing ticket sales target. Respect in the community does not directly address the business challenges TrueColor is facing, such as increasing ticket sales to 100,000. Sukanta's decision to delay changes should be rooted in a need to understand market dynamics and operational strengths, not in the personal standing of Zedius's owners. Therefore, this option is irrelevant to the core decision-making process.

Option D: This option is incorrect because it suggests that Sukanta should take bold and immediate action, which contradicts the idea of delaying major changes. While it is true that Sukanta was hired to increase ticket sales, "by whatever means necessary" does not imply that changes must happen immediately. Making significant changes without adequate understanding of the market and Zedius’s role could backfire and lead to poor results. Sukanta’s mandate is to achieve long-term growth, and taking time to evaluate the situation before acting would be a more prudent approach.

Option E: This option is incorrect because it focuses on the historical stagnation of ticket sales, which actually supports the case for change rather than delaying it. If ticket sales have consistently been at 50,000 for a decade, it suggests that there is a pressing need for new strategies or interventions to meet the aspirational target of 100,000. Therefore, this reason would encourage Sukanta to make immediate changes rather than wait and observe. It does not align with the decision to avoid making major changes in his first year.

 Option C is the best choice because it provides a logical, strategic reason for Sukanta to delay making major changes. It acknowledges his need to familiarize himself with the market and gather insights before taking bold steps. The other options either fail to provide strong justifications for delaying action (A and B) or contradict the idea of postponing changes by suggesting immediate action (D and E). By prioritizing market understanding, Sukanta sets himself up for informed and effective decision-making in the future.


Create a FREE account and get:

  • All Quant Formulas and shortcuts PDF
  • 15 XAT previous papers with solutions PDF
  • XAT Trial Classes for FREE

    cracku

    Boost your Prep!

    Download App