Which of the following statements is true in the context of internal venturing?
A)The managers who pioneer the new venture lack autonomy and decision-making powers.
B)Strict output controls are most appropriate for new venture divisions.
C)Stock options are often used in new venture divisions.
D)Most of the operational functions of the new venture division are centralized.
E)New venture projects are never complete without the involvement of an external company.

Question

Quizplus · Accepted Answer

Stock options are a common and effective tool used to incentivize and reward employees in new venture divisions, who may not have the same financial benefits as those in established divisions. Options grant the employees the right to purchase company stock at a specified price within a certain timeframe, which can motivate them to work harder towards the success of the venture.

Options A, B, D, and E are incorrect. A lack of autonomy and decision-making powers would hinder the success of the new venture. Strict output controls may stifle creativity and innovation in the early stages of the venture. Decentralization is often preferred in new venture divisions to allow for more flexibility and responsiveness. External companies may be involved in new venture projects, but this is not a necessary or universal aspect of internal venturing.

Which of the Following Statements Is True in the Context