Management Consulting
Exam Answer Key
Course Introduction
Management Consulting explores the principles, practices, and methodologies used by consultants to help organizations improve performance and solve complex business challenges. The course covers the consulting process from client engagement and problem definition to data analysis, solution development, and implementation. Students will learn about industry-standard frameworks, effective communication strategies, and ethical considerations in the consulting profession. Through case studies, group projects, and practical assignments, participants will develop critical thinking, analytical, and presentation skills necessary for a successful career in management consulting.
Recommended Textbook
Strategic Management Concepts 3rd Edition by Frank
Rothaermel
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Chapter 1: What Is Strategy
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Sample Questions
Q1) _____ is best described as a framework that helps firms recognize and address the economic,legal,social,and philanthropic expectations that society has of the business enterprise at a given point in time.
A) Corporate social responsibility
B) Integrated social network
C) Strategic positioning
D) Strategy formulation
Answer: A
Q2) A firm that achieves superior performance relative to other firms in the same industry or the industry average has a(n)
A) competitive advantage.
B) balanced scorecard.
C) power position.
D) equity leverage.
Answer: A
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Chapter 2: Strategic Leadership: Managing the Strategy Process
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Sample Questions
Q1) A company uses the planned emergence approach in the development of its strategies.Which of the following is an implication of this?
A) The employees will be isolated from the process of setting the company's vision and mission.
B) The lower-level employees will be restricted to the tasks involved in strategic implementation.
C) The company's organizational structure and systems will be designed to support bottom-up strategic initiatives.
D) The top management will create a strategy that is based on hard data alone, rather than an inspiring vision.
Answer: C
Q2) A company's strategic business unit
A) does not need to adopt the overall corporate strategy.
B) is responsible for its own profit and loss.
C) is a division solely created to design strategies during turbulent times.
D) decides which industries and markets to compete in for an entire conglomerate.
Answer: B
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Chapter 3: External Analysis: Industry Structure,
Competitive Forces, and Strategic Groups
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Sample Questions
Q1) In a firm's external environment,_____ primarily capture population characteristics related to age,gender,family size,ethnicity,sexual orientation,religion,and socioeconomic class.
A) political trends
B) demographic trends
C) ecological trends
D) economic trends
Answer: B
Q2) In which of the following situations is a company that exists in the telecommunications industry most likely to face the highest threat of entry?
A) if the company is able to put up a credible threat of retaliation
B) if the capital requirements in the industry are high
C) if the customer switching costs in the industry are high
D) if the industry has recently become deregulated
Answer: D
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Chapter 4: Internal Analysis: Resources, Capabilities, and Core Competencies
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Sample Questions
Q1) Which of the following accurately summarizes the difference between the resources and capabilities of a firm?
A) Resources are tangible; capabilities are tangible and intangible.
B) Resources are intangible; capabilities are tangible.
C) Resources are tangible and intangible; capabilities are intangible.
D) Resources are tangible; capabilities are intangible.
Q2) Each activity a firm performs along the horizontal value chain adds _____ value.
A) temporary
B) little
C) incremental
D) absolute
Q3) A firm's resources and capabilities are costly to imitate.This is because rival companies do not clearly understand the relationship between the resources and capabilities controlled by the firm.In this case,the firm's competitive advantage is protected against imitation by A) path dependence.
B) dependence complexity.
C) causal ambiguity.
D) social complexity.
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Chapter 5: Competitive Advantage, Firm Performance, and Business Models
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Sample Questions
Q1) A watchmaking company has priced one of its wristwatches at $210.Most of its competitors sell similar watches at $180.Selling anything less than $150 would result in a loss for the company.However,the absolute maximum a customer is willing to pay for it is $170.In this scenario,what is the reservation price of the wristwatch?
A) $150
B) $180
C) $170
D) $210
Q2) Airbnb rents spaces that previously would have been unused to generate revenue,while also dramatically increasing the potential amount of accommodation space in the 191 countries.This business uses a _____ technique.
A) offshoring
B) crowdsourcing
C) peer-to-peer
D) binge watching
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Chapter 6: Business Strategy: Differentiation, Cost
Leadership, and Blue Oceans
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Sample Questions
Q1) To be cost-competitive,a firm should
A) position itself below the productivity frontier.
B) operate at the minimum efficient scale.
C) attain the highest cost position.
D) avoid moving on to a steeper experience curve.
Q2) Even without differentiation parity,a firm pursuing a cost-leadership strategy can still gain a competitive advantage as long as its
A) learning curve is not steeper than that of its competitors.
B) per-unit costs are higher than that of its competitors.
C) economic value creation exceeds that of its competitors.
D) value gap is lower than that of its competitors.
Q3) Diseconomies of scale refer to
A) decreases in cost as profit increases.
B) increases in cost as output increases.
C) increases in economic value as per-unit cost decreases.
D) decreases in profit when consumer demand decreases.
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Chapter 7: Business Strategy: Innovation and Entrepreneurship
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Sample Questions
Q1) Which of the following is a drawback of using the industry life cycle as a framework to guide strategic choice?
A) The framework believes that the life cycle of industries is unpredictable.
B) The framework does not explain everything about changes in industries.
C) The framework is based on the tenet that industries can be rejuvenated even in the declining stage.
D) The framework believes that the number and size of competitors remain constant throughout the life cycle.
Q2) Which of the following statements is true of firms pursuing a closed innovation?
A) Firms following the closed innovation model are less likely to be prone to the not-invented-here syndrome.
B) Firms in the closed innovation model are extremely protective of their intellectual property.
C) Firms in the closed innovation model focus on building a more effective business model to commercialize R&D, rather than focusing on being first to market.
D) Firms following the closed innovation model will find activities such as spin-out ventures or strategic alliances crucial to commercialize their internally developed R&D.
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Chapter 8: Corporate Strategy: Vertical Integration and Diversification
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Sample Questions
Q1) In 2009,ExxonMobil bought XTO Energy,a natural gas company,for $31 billion.XTO Energy is known for its core competency to extract natural gas from unconventional places such as shale rock-the type of deposits currently being exploited in the United States.ExxonMobil hopes to leverage its core competency in the exploration and commercialization of oil into natural gas extraction.Based on this example,ExxonMobil is engaging in
A) unrelated-linked diversification.
B) unrelated-constrained diversification.
C) related-linked diversification.
D) related-constrained diversification.
Q2) _____ is best described as a form of long-term contracting in the manufacturing sector that enables firms to commercialize intellectual property.
A) Lean manufacturing
B) Licensing
C) Crowdsourcing
D) Bootlegging
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Chapter 9: Corporate Strategy: Strategic Alliances, Mergers and Acquisitions
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Sample Questions
Q1) Which of the following is an advantage of equity alliances when compared to non-equity alliances?
A) They are more flexible and easy to initiate and terminate.
B) They require smaller capital investments.
C) They produce stronger ties between partners.
D) They are based on contracts rather than ownership.
Q2) Which of the following examples describes the task of an alliance manager?
A) Sophia oversaw the agreement between her company and the potential alliance partner and offered support when needed.
B) Ira used his knowledge of digital watches to help him to manage the day-to-day operations of the alliance.
C) Natasha reviewed the alliance portfolio to make sure it fit with the corporate strategy of her firm.
D) Fyodor trained the employees of his alliance partner in the skills needed to create a display for an e-notebook.
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Chapter 10: Global Strategy: Competing Around the World
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Sample Questions
Q1) Zeda is a country of English-speaking people and has a very profitable economy.Which of the following countries is most likely to be the closest to Zeda in terms of cultural distance?
A) Olax, which has the same wealth and per capita income as Zeda
B) Jordax, which has a very profitable economy and where people speak Jordaxian
C) Segar, where people speak English and have a low standard of living
D) Terra, which is located close to Zeda and is easily accessible by road
Q2) Which of the following factors is the most important determinant of economic distance?
A) the wealth and per capita income of consumers
B) the ethnicity and religion of consumers
C) the presence of legal institutions in a country
D) the topography of a country
Q3) Which of the following is not included within the types of strategic alliances?
A) joint ventures
B) franchising
C) acquisitions
D) licensing
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Chapter 11: Organizational Design: Structure, Culture, and Control
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Sample Questions
Q1) Why does strategy implementation often require changes within an organization?
A) Strategy implementation is less important than strategy formulation.
B) Strategy implementation transforms strategy into actions and business models.
C) Strategy always follows structure.
D) Strategy implementation does not affect resource allocation and power distribution within an organization.
Q2) To effectively implement a differentiation strategy,managers rely on a functional structure that resembles an organization that is highly
A) formalized.
B) specialized.
C) organic.
D) mechanistic.
Q3) Which of the following organizational structures matches best with an international strategy?
A) simple
B) matrix
C) multidivisional
D) functional
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Chapter 12: Corporate Governance and Business Ethics
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Sample Questions
Q1) Travis,the CEO of Riplon Corp.,used company funds to buy a car worth $1 million and a house for $6 million in Santa Fe.This is an example of
A) corporate governance.
B) on-the-job consumption.
C) adverse selection.
D) shared value creation.
Q2) Which of the following perspectives best supports the shared value creation framework?
A) Markets are more often than not defined by societal needs rather than economic needs.
B) Failing to create value for society almost always reflects on the bottom line.
C) A firm's competitive advantage depends on pitting economic and societal needs in a trade-off.
D) Externalities such as pollution, wasted energy, and costly accidents actually create internal costs.
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