Deck 11: Organizational Structure, Systems, and Processes

Question 1

The processes of formulation and implementation are iterative and interdependent.

Answer 1

True

Question 2

Strategy implementation often fails because of managers' inability to assess potential implementation obstacles.

Answer 2

True

Question 3

For Lean manufacturing practices to work well in a firm, experts say that the organization's culture must change in significant ways.

Answer 3

True

Question 4

By and large, firms find it much more difficult to generate new ideas and knowledge than to implement good ideas.

Question 5

"Lean" manufacturing process improvement is typically implemented by small scale manufacturers.

Question 6

Usually, strategy formulation problems are the source of performance problems.

Question 7

Culture can usually be adapted to fit the strategy relatively easily and quickly.

Question 8

In today's business climate there are two types of companies, "the quick" and "the dead."

Question 9

Lean manufacturing helps to create an environment where people know what is expected and perform their duties without having to be reminded.

Question 10

An explanation for the knowing-doing gap is that the strategy-formulation process isn't usually shared with stakeholders who will be integral in rolling out the strategy.

Question 11

Strategists may face both internal and external obstacles.

Question 12

Formulation is the process of aligning the five elements of the strategy diamond.

Question 13

A strategy is only as good as its execution.

Question 14

Neither formulation nor implementation can succeed without the other.

Question 15

Firms with weak shared values are usually better at implementing strategies.

Question 16

The difference between what firms know and what they do is referred to as the learning gap.

Question 17

One of the least important external implementation obstacles is a firm's culture.

Question 18

The most successful firms often adjust strategies and execution according to feedback from the implementation process.

Question 19

Lean manufacturing allows firms to reduce the "road blocks and speed bumps" that get in the way of their ability to quickly add value.

Question 20

Lean manufacturing practices allow companies to decrease the speed of operations to a more normal pace.

Question 21

Firms with weak cultures seem to be less variable in their performance outcomes.

Question 22

Executives who are responsible for executive strategy are often highly conservative in their projections of execution success.

Question 23

Functional organization helps managers of larger firms improve efficiency by fostering professionalism in the performance of specialized tasks.

Question 24

The more simple the firm, the more the structure will need to concentrate on coordination.

Question 25

The multidivisional structure can encourage undesirable competition between business units.

Question 26

Decision rights are the policies that tell individuals who's responsible for generating certain information and who's authorized to act on it.

Question 27

Anything that enables an executive to get leverage to execute change can be considered an implementation lever.

Question 28

The matrix structure provides flexibility because it organizes teams around special projects or markets.

Question 29

In diversified firms, the parent company itself may be an internal obstacle to strategy implementation.

Question 30

When a functional structure is used in a dynamic market, the organization may be slow in responding to changing customer demands.

Question 31

People and rewards are the implementation levers that usually get the most attention in an organization.

Question 32

Any of the functions in a value chain can be organized as a unit in a functional structure.

Question 33

As firms become more complex, the functional structure becomes even more appropriate.

Question 34

Organizational charts are static representations of their structure.

Question 35

The multidivisional structure enables firms to design compensation systems that reward performance at the functional level.

Question 36

A firm's structure should seek a balance between control and the delegation of authority necessary to make timely decisions.

Question 37

A firm's culture consists of the core organizational values that are widely held and shared by employees, managers, and owners.

Question 38

The network structure is a hybrid between the functional and multidivisional structures.

Question 39

A multidivisional structure organizes its activities according to the specific functions that a company performs.

Question 40

The positive effect of shared values on performance is stronger in a highly competitive market.

Question 41

A balanced scorecard may also be called a strategy scorecard.

Question 42

The balanced scorecard approach is weakened when compensation is tied to financial and nonfinancial measures.

Question 43

The strategy map states objectives in order to guide key activities.

Question 44

A franchisee assumes all management responsibility for individual business locations.

Question 45

The process of financial budgeting is useful only as a feedback tool.

Question 46

Strategic budgets help to determine resource allocation.

Question 47

The financial perspective of the balanced scorecard may focus on issues such as enhancing customer value and increasing asset utilization.

Question 48

A matrix structure also includes external linkages with suppliers and customers.

Question 49

A balanced scorecard links all performance metrics to the firm's strategy.

Question 50

In the functional structure, authority is based on the control of resources and knowledge and not on hierarchical rank.

Question 51

The professional partnership transfers ownership and shifts all local management responsibility to local facilities.

Question 52

Confusion and ambiguity are potential drawbacks to the network structure.

Question 53

The balanced scorecard encourages managers to rely solely on short-term financial and outcome measures.

Question 54

The balanced scorecard can serve as a tool for communicating vision and mission throughout an organization.

Question 55

Strategic budgets focus on issues such as identifying and acquiring new customers.

Question 56

Because most of the capital costs are picked up by the franchisor, the franchise model enables a firm to grow rapidly.

Question 57

Selection and retention are both areas dealt with in the external relations perspective of a strategy map of the balanced scorecard.

Question 58

Financial budgets impose a form of outcome control that tends to constrain managers.

Question 59

Employees are sometimes called a firm's human capital.

Question 60

A shortsighted focus on factors such as return on equity may cause managers to divert their attention from other key stakeholders.

Question 61

Implementing strategy often entails some back-channel maneuvering.

Question 62

In the workplace, what gets done is what gets rewarded.

Question 63

Decisions about which and how many people to employ hinge on the desire either to improve efficiency or generate new revenues.

Question 64

Downsizing will usually result in a short-term stock price improvement.

Question 65

Rewards serve as a form of control.

Question 66

Division managers who are paid solely on the basis of business-unit performance may be less likely to share resources with other divisions.

Question 67

Competitive advantage is inextricably linked to a firm's human capital.

Question 68

The global structure resembles a decentralized federation similar to the relationship between the U.S. federal government and the fifty state governments.

Question 69

Companies can reduce human capital loss by developing industry-specific, transferable knowledge.

Question 70

The appropriate allocation of resources should involve making choices based on the resource allocation of competitors.

Question 71

The importance of having the right people is accentuated in technologically intensive industries.

Question 72

Penalties should be applied to performance that's unrelated to an organization's strategic objectives.

Question 73

Internal interests can sabotage effective resource-allocation decisions.

Question 74

Communicating upward means enlisting the support of the lower- and middle-level managers.

Question 75

Adjusting organization structure to eliminate mechanistic processes and to accommodate more egalitarian models reduces turnover.

Question 76

Aspects of strategy must be communicated to external constituencies, such as suppliers, because they play a critical role in strategic implementation.

Question 77

Outcome controls reward individuals based on whether a measurable goal has been achieved.

Question 78

Research and development is generally a firm's largest operating cost.

Question 79

Firms in human capital intensive industries must develop strategies to reduce turnover and attrition rates.

Question 80

The productivity declines after a company downsizes are usually minimal and correct within the following year.