Quiz 10 | Chapter 9
Q: Which of the following is NOT one of the steps in the sequence to the "traditional" approach
to strategic control?
Refer To: Exhibit 9.1
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Action plans are submitted by lower level managers.
Performance is measured against the predetermined goal.
Strategies are implemented.
Strategies are formulated and top management sets goals.
Learning Objective: 09-02
The traditional approach to strategic control is sequential: (1) strategies are formulated and top
management sets goals, (2) strategies are implemented, and (3) performance is measured against
the predetermined goal set, as illustrated in Exhibit 9.1.
Q: A major difference between traditional and contemporary approaches to strategic control is
that:
the contemporary approach is more linear.
the traditional approach has no feedback loop.
the traditional approach does not require a commitment to predetermined goals.
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the contemporary approach is more interactive.
Learning Objective: 09-02 & 09-03
In the contemporary approach, the relationships between strategy formulation, implementation,
and control are highly interactive, as suggested by Exhibit 9.2.
Q: ________ control is primarily concerned with "doing the right thing" while ________ control
asks if the organization is "doing things right."
External; internal
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Informational; behavioral
Boundary; constraint
Traditional; contemporary
Learning Objective: 09-03
Informational control is primarily concerned with whether or not the organization is "doing the
right things." Behavioral control, on the other hand, asks if the organization is "doing things
right" in the implementation of its strategy. Both the informational and behavioral components of
strategic control are necessary, but not sufficient, conditions for success.
Q: Continuous monitoring has benefits that include:
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enhancing the organization's ability to respond with speed and flexibility.
replacing the time-consuming process of organizational learning.
dramatically altering the organization's response to its competitive environment.
all of these
Learning Objective: 09-03
In the contemporary approach, there is "double-loop" learning in which the organization's
assumptions, premises, goals, and strategies are continuously monitored, tested, and reviewed.
The benefits of continuous monitoring are evident: time lags are dramatically shortened, changes
in the competitive environment are detected earlier, and the organization's ability to respond with
speed and flexibility is enhanced.
Q: The text describes an organization's ________ as, "You can't touch it or write it down, but it's
there in every organization; its influence is pervasive; it can work for you or against you."
structure
reward system
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culture
expropriation
Learning Objective: 09-04
Collins and Porras argued in Built to Last that the key factor in sustained exceptional
performance is a cultlike culture. You can't touch it or write it down, but it's there in every
organization; its influence is pervasive; it can work for you or against you. Effective leaders
understand its importance and strive to shape and use it as one of their important levers of
strategic control.
Q: The functions of reward and incentive systems include all of the following EXCEPT:
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guaranteeing a system of shared values.
focusing efforts on high-priority tasks.
motivating high levels of individual and collective task performance.
representing an effective control mechanism.
Learning Objective: 09-04
Reward and incentive systems represent a powerful means of influencing an organization's
culture, focusing efforts on high-priority tasks, and motivating individual and collective task
performance. The reward system, by specifying who gets rewarded and why, is an effective
motivator and control mechanism.
Q: Cadbury Schweppes controls the use of bribes by requiring all payments to be recorded on the
company's books, which is an example of using ________ to minimize improper and unethical
conduct.
culture
rewards and incentives
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boundaries
governance
Learning Objective: 09-04
Guidelines (constraints) can be useful in specifying proper relationships with stakeholders. Many
companies have explicit rules regarding commercial practices, including the prohibition of any
form of payment, bribe, or kickback. Cadbury Schweppes has a simple but effective step to
control the use of bribes by specifying that all payments, no matter how unusual, are recorded on
the company's books.
Q: Which form of behavioral control is most appropriate for a typical Department of Motor
Vehicles operation?
culture
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rules
governance
rewards
Learning Objective: 09-04
Control in bureaucratic organizations is dependent on members following a highly formalized set
of rules and regulations. Most activities are routine and the desired behavior can be specified in a
detailed manner because there is generally little need for innovative or creative activity. The
Department of Motor Vehicles in most states must follow clearly prescribed procedures when
issuing or renewing driver licenses.
Q: Which of the following is NOT an important part of an organization's efforts to move from a
control system based on boundaries to one based on rewards and culture?
hiring the right people
training to build skills and strong identification with organizational values
ensuring there are managerial role models
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eliminating inequities in compensation
Learning Objective: 09-04
In most environments, organizations should strive to provide a system of rewards and incentives,
coupled with a culture strong enough that boundaries become internalized. This reduces the need
for external controls such as rules and regulations. First, hire the right people, individuals who
already identify with the organization's dominant values and have attributes consistent with
them. Second, training plays a key role. Training not only builds skills, but also plays a
significant role in building a strong culture on the foundation of each organization's dominant
values. Third, managerial role models are vital. Fourth, reward systems must be clearly aligned
with the organizational goals and objectives.
Q: Defense tactics by incumbent management like poison pills and golden parachutes prevent
________ from effectively reigning in opportunistic behavior by executives.
auditors
banks and analysts
the media
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the takeover constraint
Learning Objective: 09-06
Although in theory the takeover constraint is supposed to limit managerial opportunism, in recent
years its effectiveness has become diluted as a result of a number of defense tactics adopted by
incumbent management. Foremost among them are poison pills, greenmail, and golden
parachutes.