Question 1

The more homogeneous a top management team, the more likely those managers will be innovative and willing to pursue strategic change.

Accepted Answer

The statement is false. Research has found that diversity among top management teams can lead to increased innovation and the ability to effectively adapt to changing environments. Homogeneity can lead to groupthink and resistance to new ideas, hindering innovation and strategic change.

Question 2

The most critical ability of a strategic leader is the ability to attract and then manage human capital.

Accepted Answer

Strategic leaders need to be able to build and lead a strong team to achieve organizational goals. Attracting, developing, and managing human capital is a critical component of this process. Without the right people, even the best strategy may not succeed.

Question 3

Typically, a vice president would NOT be considered to hold a high enough position to be included in the top management team of an organization.

Accepted Answer

A Vice President is often considered a part of the top management team of an organization, especially in large companies. They may even be part of the executive leadership team, which includes the highest-level executives in the organization.

Question 4

The CEO is the individual with primary responsibility for effective strategic leadership within an organization.

Accepted Answer

The role of the CEO is to provide strategic leadership for the organization and ensure that the company is moving in the right direction to achieve its goals and objectives.

Question 5

Board members with substantive expertise in the firm's core functions and businesses aids the effectiveness of the top management team.

Accepted Answer

Having board members with expertise in the firm's core functions and businesses can provide valuable insights and guidance to the top management team, ultimately increasing their effectiveness.

Question 6

The Chapter 12 Opening Case illustrates the role of the CEO in shaping the strategy of the firm, specifically the strategic shift at HP towards software development.

Accepted Answer

The statement accurately summarizes the opening case of Chapter 12, which discusses the strategic shift at HP under the leadership of CEO Meg Whitman towards software development.

Question 7

The more heterogeneous and the larger the top management team, the easier it is to implement strategy effectively.

Accepted Answer

Research suggests that a larger and more heterogeneous top management team can lead to conflicts, communication problems, and slower decision-making. Smaller and more cohesive teams tend to be more effective in implementing strategy.

Question 8

HP's new CEO who came from SAP (Chapter 12 Opening Case) is less likely to initiate strategic change because he is not familiar with the industry in which HP competes.

Accepted Answer

While the new CEO may not have industry-specific expertise, it does not necessarily mean that he is less likely to initiate strategic change. As a leader with experience in strategic management and a fresh perspective, he may bring new ideas and approaches to the company. Additionally, he can rely on the expertise of his management team and engage in industry research to familiarize himself with the industry.

Question 9

Firm size, firm age, the executive's tolerance for ambiguity, and his or her commitment to strategic outcomes are all factors that may affect managerial discretion.

Accepted Answer

These factors can influence the level of discretion that a manager has in making decisions and implementing strategies within a firm.

Question 10

Because of the challenges top executives face, they often are more effective when they operate as top management teams.

Accepted Answer

Top executives face complex and interdependent decisions, and working together as a team can lead to better decision-making, improved communication, and a shared sense of responsibility for the organization's success.

Question 11

A CEO may gain power by holding the titles of both CEO and Chairman of the Board.

Accepted Answer

When a CEO also holds the title of Chairman of the Board, they have more control and influence over the board's decisions, potentially increasing their power within the company. However, it is also important to note that some companies separate these roles to promote better corporate governance and prevent the concentration of power in one individual.

Question 12

Compared to homogeneous top management teams, heterogeneous top management teams are more likely to change their firm's strategies when necessary and to support innovation.

Accepted Answer

This is because heterogeneous top management teams bring in diverse perspectives and experiences, which allows for more creative and innovative solutions to problems. They are also better equipped to understand and respond to changes in the market, leading to more adaptable and flexible strategies.

Question 13

One challenge for the new HP CEO, Leo Apotheker, will be to rebuild HP's culture of innovation which has been lost over the last few years (Chapter 12 Opening Case).

Accepted Answer

The Chapter 12 Opening Case states that HP's culture of innovation has been lost in recent years, presenting a challenge for the new CEO to rebuild it.

Question 14

External environmental factors that may affect managerial discretion include industry structure, rate of market growth, and degree to which products an be differentiated.

Accepted Answer

External environmental factors such as industry structure, rate of market growth, and degree of product differentiation can impact how much discretion managers have in decision-making.

Question 15

Transformational leadership is the most effective strategic leadership style.

Accepted Answer

Transformational leadership is a strategic leadership style that inspires and motivates followers to achieve their full potential and achieve the organization's goals. It focuses on developing and empowering people to become leaders themselves and encourages creativity and innovation in problem-solving. Studies have shown that transformational leadership is effective in improving performance, job satisfaction, and organizational commitment. Therefore, it can be considered the most effective strategic leadership style.

Question 16

The CEO of YorkMark, Inc., has an exceptional amount of power in the organization. It is likely the board of directors is composed of sympathetic outside members and insiders who report to the CEO.

Accepted Answer

The statement suggests that the CEO has an exceptional amount of power and that the board of directors is composed of sympathetic outside members and insiders who report to the CEO, indicating that the CEO has significant influence over the board. Therefore, it is likely that the CEO wields great power within the organization.

Question 17

Top management team members and CEOs who have long tenure on the team and in the organization have greater influence in board decisions.

Accepted Answer

Top management team members and CEOs who have long tenure on the team and in the organization have greater institutional knowledge, experience and relationships, which can result in greater influence in board decisions.

Question 18

The decision making discretion of top-level managers is determined partly by external environmental factors such as the industry structure, the industry's rate of growth, and the degree to which products can be differentiated.

Accepted Answer

External environmental factors such as industry structure, growth rate and product differentiation can impact the decision-making discretion of top-level managers.

Question 19

In addition to determining new strategic initiatives, top-level managers also develop the appropriate organizational structure and reward systems of a firm.

Accepted Answer

Top-level managers not only determine new strategic initiatives but also make decisions about the organizational structure and reward systems of a firm. This helps to ensure that the firm's structure and systems support the achievement of strategic goals.

Question 20

Strategic leadership is the ability to anticipate, envision, maintain flexibility, and empower others to create strategic change as necessary.

Accepted Answer

Strategic leadership involves anticipating future trends, having a vision for the future, being flexible in adapting to changing circumstances, and empowering others to help achieve strategic goals.

Quiz 12: Strategic Leadership