CMC Strategic Planning & Organizational Development 3 — Questions and Answers
Question 1: A CMC consultant recommends redesigning a client's organization around customer segments rather than functional departments. This is an example of transitioning to which structure?
- Functional structure
- Divisional (market-based) structure (Correct answer)
- Matrix structure
- Flat structure
Correct answer: Divisional (market-based) structure
A divisional structure organized by customer segment groups all resources and activities needed to serve a particular market, improving customer responsiveness.
Question 2: In VRIO analysis, a resource that is valuable and rare but easily imitated provides a firm with:
- Sustained competitive advantage
- Temporary competitive advantage (Correct answer)
- Competitive parity
- Competitive disadvantage
Correct answer: Temporary competitive advantage
VRIO logic states that without inimitability (and organizational support), a rare and valuable resource yields only a temporary advantage before competitors replicate it.
Question 3: An organization using OKRs (Objectives and Key Results) correctly should set key results that are:
- Aspirational activity metrics tied to team effort
- Measurable outcomes that indicate progress toward the objective (Correct answer)
- Approved by HR and tied directly to compensation
- Qualitative descriptions of desired behaviors
Correct answer: Measurable outcomes that indicate progress toward the objective
Key results in the OKR framework must be quantifiable outcome indicators — not tasks or activities — that verify whether the objective was achieved.
Question 4: When applying Lewin's Force Field Analysis, a management consultant would recommend strengthening driving forces OR:
- Increasing budget allocations
- Reducing or removing restraining forces (Correct answer)
- Expanding the scope of the change initiative
- Hiring external change agents
Correct answer: Reducing or removing restraining forces
Lewin's model shows that change occurs when driving forces exceed restraining forces; removing barriers is often more effective than simply adding more pressure to drive change.
Question 5: A strategic alliance differs from a merger primarily because:
- Alliances require government approval while mergers do not
- Partners in an alliance retain independent legal identities and share only specific activities (Correct answer)
- Mergers are shorter-term arrangements than alliances
- Alliances always involve equity exchange between the parties
Correct answer: Partners in an alliance retain independent legal identities and share only specific activities
In a strategic alliance, each organization remains legally separate and collaborates on defined activities, whereas a merger combines entities into a single new organization.
Question 6: Which concept describes the danger of a dominant firm becoming too focused on existing customers at the expense of emerging market shifts?
- Core rigidity
- Strategic myopia
- The innovator's dilemma (Correct answer)
- Analysis paralysis
Correct answer: The innovator's dilemma
Clayton Christensen's 'innovator's dilemma' describes how listening too closely to current customers causes established firms to miss disruptive innovations that initially serve less-demanding segments.
Question 7: In organizational development, an 'appreciative inquiry' approach to change differs from problem-solving because it:
- Ignores current performance deficiencies entirely
- Focuses on discovering and amplifying what already works well in the organization (Correct answer)
- Relies exclusively on quantitative performance data
- Delegates change design entirely to frontline employees
Correct answer: Focuses on discovering and amplifying what already works well in the organization
Appreciative inquiry (AI) builds change capacity by identifying and scaling existing strengths and successes rather than diagnosing and fixing deficits.
CMC Strategic Planning & Organizational Development 3
A CMC consultant recommends redesigning a client's organization around customer segments rather than functional departments.
This is an example of transitioning to which structure?