PeopleCert ITIL-4-DITS ITIL 4 Leader: Digital & IT Strategy Exam Exam Practice Test

Comprehensive and Detailed Explanation From Exact Extract:

According to ITIL 4 Leader: Digital & IT Strategy, a critical role of leaders is to ensure that stakeholders, including shareholders, understand the strategic direction and how it impacts organizational value. Shareholders are primarily concerned with business performance and return on investment. Therefore, it’s essential that strategy communications emphasize how strategic changes affect the organization's financial health and competitive positioning. This builds trust and aligns stakeholder expectations.

An organization’s products are required for the execution of an activity is the best description of the relationship between organization’s products, services, and resources. A product is a configuration of an organization’s resources designed to offer value for a consumer. A service is a means of enabling value co-creation by facilitating outcomes that customers want to achieve without specific costs and risks. A resource is anything that might help deliver an organizational objective. References: ITIL 4 Leader: Digital and IT Strategy, page 11-12

Management of staff skills and competence is what the organization needs for the digital transformation to succeed. This means that the organization ensures that its staff have the necessary skills and competence to support the digital transformation and deliver value to customers. This can involve training, development, coaching, mentoring, recruitment, retention, and motivation of staff. References: ITIL 4 Leader: Digital and IT Strategy, page 68-69

A low risk capacity means that an organization cannot afford the loss that comes from taking risks that go wrong, while a high risk appetite means that an organization is willing to take those risks anyway. This situation can lead to big losses and unsustainable outcomes. References: ITIL 4 Leader: Digital and IT Strategy, page 57

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This scenario describes a risk attitude where the organization knowingly accepts a high level of risk in pursuit of potential gains. According to the ITIL 4 Leader: Digital & IT Strategy guidance, arisk-seekingattitude is characterized by a willingness to pursue opportunities that have uncertain outcomes and potentially high rewards, even when there is a significant chance of failure or negative impact. This is contrasted with risk-averse (avoiding risk), risk-tolerant (accepting risk but not seeking it), and risk-neutral (indifferent to risk levels). Here, launching new but unreliable technology despite known concerns fits a risk-seeking approach.

Digital transformation is the most relevant approach to achieve the objective of continually maintaining market relevance. It is about using digital technology to create new or modify existing business processes, culture, and customer experiences to meet changing market needs and expectations. It also helps to create value, enhance competitiveness, and foster innovation. References: ITIL 4 Leader: Digital and IT Strategy, page 5

Adjusting competitive prices for the market and competition is about setting prices that reflect the value of the services, the demand and supply in the market, and the prices of similar or substitute services offered by competitors. This can help attract customers, increase sales, and gain market share. References: ITIL 4 Leader: Digital and IT Strategy, page 81

Digital technology includes the use of hardware and software to store, retrieve, transmit, and manipulate data. It is one of the components of digital transformation, which is the use of digital technology to create new or modify existing business processes, culture, and customer experiences. Digital strategy is the plan for how an organization will use digital technology to achieve its goals and objectives. Digital business is the business model that leverages digital technology to create value for customers and stakeholders. References: ITIL 4 Leader: Digital and IT Strategy, page 5-6

Digital transformation is the use of digital technology to create new or modify existing business processes, culture, and customer experiences to meet changing market needs and expectations. An organization that has utilized digital technology to make significant improvements to business processes that have contributed to the achievement of its strategic objectives has undergone a digital transformation. References: ITIL 4 Leader: Digital and IT Strategy, page 5

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Innovation, as described in ITIL 4 Leader: Digital & IT Strategy, involvesintroducing new ways of creating value—this includes adopting entirely new service creation models, delivery mechanisms, or business practices. The key term in the question is "completely new," which distinguishes it from incremental transformation. Operational technology (B) is a type of technology. Ecosystem disruption (C) involves market-level changes, not internal shifts.

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This scenario reflects asynergisticmodel, where a new channel (third-party sales) is expected to complement and enhance the existing channel (direct website sales) through brand visibility and increased reach. According to ITIL 4, a “synergism” model is used when multiple channels reinforce each other, resulting in net-positive effects across the ecosystem. Cannibalism (A) would imply internal competition and reduced performance. Erosion (B) implies declining value. Concurrence (C) involves operating parallel models without direct beneficial interaction.

Comprehensive and Detailed Explanation From Exact Extract:

Digital readiness assessments evaluate whether an organization is equipped to succeed in a digital strategy environment. A key component isstaff capability and learning culture—whether the workforce has the skills, knowledge, and mindset needed for digital transformation. ITIL 4 stresses that organizational learning, upskilling, and leadership development are vital to readiness. Option C aligns directly with this. The other options focus on security, investment, or operations—not strategic capability building.

The innovation will deliver significant benefit for the organization is a reason why an organization might choose to implement an innovation even though it does not meet its minimum requirement for “return on investment” (ROI). This means that the organization values the long-term or intangible benefits of the innovation more than the short-term or financial returns. For example, the innovation might enhance customer satisfaction, brand reputation, market share, or social impact. References: ITIL 4 Leader: Digital and IT Strategy, page 27-28

A sourcing strategy is about deciding how to acquire and manage the resources and capabilities needed to deliver services, including suppliers and partners. An organization that is continually changing to maintain customer and market relevance needs a sourcing strategy that can support these changes by enabling flexibility, agility, innovation and collaboration with suppliers and partners. References: ITIL 4 Leader: Digital and IT Strategy, page 75-76

Looking at the potential of new tools to meet customer needs is a leadership skill that relates to having a digital mindset. It shows curiosity, openness, and willingness to explore and adopt new technologies that can enhance customer value and experience. It also demonstrates a customer-centric and innovative approach to digital transformation. References: ITIL 4 Leader: Digital and IT Strategy, page 25-26

Comprehensive and Detailed Explanation From Exact Extract:

ITIL 4 emphasizes that digital and IT strategies must becontinually generated and adapteddue to the rapidly evolving technology landscape, market dynamics, and customer expectations. Unlike traditional strategies updated annually or quarterly, a continual strategy management approach allows organizations to stay agile and resilient. Option C best aligns with ITIL 4’s adaptive operating model, where strategic planning and execution are iterative and responsive to internal and external changes.

All the organization’s stakeholders should contribute to risk assessment because they have different perspectives, insights, and interests in relation to the organization’s objectives, activities, and outcomes. Their involvement can help identify, analyze, evaluate, and treat risks more effectively and comprehensively. References: ITIL 4 Leader: Digital and IT Strategy, page 59

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PESTLE (Political, Economic, Social, Technological, Legal, Environmental) is a strategic analysis framework specifically designed to help organizations identify a broad spectrum of external risks and influences. ITIL 4 recommends using PESTLE for evaluatingmacro-environmental factorsthat could impact the organization’s strategic direction and risk posture. OKR (Objectives and Key Results) is a goal-setting framework. Customer analytics focuses on customer behavior, and portfolio optimization is about investment and resource allocation.