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Statement: A consulting firm's partners are split on whether to specialize in a niche market or maintain their current broad service offering. The niche market offers higher margins but limits growth potential. The broad approach provides more opportunities but faces intense competition and pricing pressure.

What strategic decision-making approach should they use?

This question was previously asked in
SSC Selection Post 2025 Graduate Level Question Paper (29-Aug-2025) (Shift 1)
The correct answer is

Analyze their core competencies and competitive advantages to determine the best strategic fit

The question asks for the approach to making the decision, not for a ready-made choice between the two paths.

Both paths have clear trade-offs: higher margins with limited growth versus more opportunities with intense competition.

Analysing the firm's core competencies and competitive advantages shows which path the firm can actually win in, so it gives an objective basis for the choice.

Jumping straight to either path ignores the trade-offs, and a client survey captures only one input rather than a complete strategic view.

So assessing core strengths to find the best strategic fit is the sound approach.

Hence, Analyze their core competencies and competitive advantages to determine the best strategic fit.

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