New strategies often entail budget reallocations because
A)revamping the performance of value chain activities can be costly.
B)the accompanying policy revisions and compensation incentives tend to require different levels of funding than before.
C)business units important in the prior strategy but having a lesser role in the new strategy may need downsizing, while units and activities that now have a bigger and more critical strategic role may need more people, new equipment, additional facilities, and above-average increases in their operating budgets.
D)empowering employees to carry out the new strategy elements and shifting to a total quality management type of culture to build skills in competent strategy execution typically require substantial new funding and budget revisions.
E)adopting best practices and pushing for continuous improvement tends to reduce costs and reduce overall resource requirements.

Question

Quizplus · Accepted Answer

New strategies often require reallocation of budgets because some business units may need to be downsized while others need more resources to fulfill their new roles. This means that budget priorities need to be reevaluated and adjusted accordingly. Revamping value chain activities, policy revisions, compensation incentives, and empowering employees might require additional funding, but it's not always the case. In some cases, adopting best practices and continuous improvement can even reduce costs and overall resource requirements. Therefore, options A, B, D, and E are not the best choices as they don't fully capture the need for budget reallocation that arises from strategic changes.

New Strategies Often Entail Budget Reallocations Because