CMC Business Strategy Development 3

Question 1

A management consultant is advising a client on corporate-level strategy. Which of the following is a corporate-level strategic decision?

Accepted Answer

Deciding which industries or markets to compete in

Answer

Corporate-level strategy determines the scope of the firm, including which industries and markets it should enter, exit, or maintain presence in.

Question 2

The concept of 'dynamic capabilities' in strategic management refers to a firm's ability to:

Accepted Answer

Sense, seize, and reconfigure resources as the environment changes

Answer

Dynamic capabilities, as defined by Teece, Pisano, and Shuen, enable firms to adapt by integrating, building, and reconfiguring internal and external competencies.

Question 3

Which growth strategy involves a company entering new markets with new products simultaneously?

Accepted Answer

Diversification

Answer

Diversification in the Ansoff Matrix involves launching new products into new markets, carrying the highest risk of all four growth strategies.

Question 4

A firm's 'sustainable competitive advantage' is best described as:

Accepted Answer

A cost or differentiation advantage that competitors cannot easily replicate

Answer

A sustainable competitive advantage is durable because it is based on resources or capabilities that are valuable, rare, inimitable, and non-substitutable (VRIN).

Question 5

In strategic planning, a 'stretch goal' is best characterized as:

Accepted Answer

An ambitious goal that requires significant capability building to achieve

Answer

Stretch goals are deliberately ambitious objectives that push organizations beyond their current capabilities, fostering innovation and transformation.

(CMC) Chartered Management Consultant Practice Test

(CMC) Chartered Management Consultant Practice Test

CMC Business Strategy Development 3