Chapter 9

Question 1

1. What is the primary purpose of Strategic Control?
   A) To monitor and correct the strategy and performance of a firm
   B) To increase the number of employees in the firm
   C) To create new products for the market
   D) To focus on expanding the firm’s market share

Answer 1

A

Question 2

Informational Control is defined as:
A) The ability to respond effectively to environmental changes
B) The process of aligning rewards with the firm’s objectives
C) The ability to diversify product lines
D) The process of monitoring employee behavior

Answer 2

A

Question 3

What does Behavioral Control focus on within an organization?
A) Aligning the company’s culture, rewards, and boundaries with the firm’s strategy
B) Reducing production costs across all departments
C) Managing financial resources and maximizing profits
D) Expanding the firm’s market presence globally

Answer 3

A

Question 4

How do Strategic Control Systems help a firm?
A) By focusing solely on increasing profits and ignoring strategic direction
B) By providing mechanisms to correct the firm’s performance and strategy
C) By expanding the firm’s operations without any adjustments
D) By focusing on creating new products without measuring their success

Answer 4

B

Question 5

Informational Control allows a firm to:
A) Monitor and align its internal culture with the market’s demands
B) Respond to environmental changes effectively and adjust its strategy
C) Increase the number of employees to match growth targets
D) Set long-term goals without any need for adaptation

Answer 5

B

Question 6

Why is Behavioral Control important for a firm’s success?
A) It helps align the firm’s internal culture with rewards and boundaries to support the overall strategy
B) It focuses on financial goals and ignores employee motivation
C) It sets performance goals without considering organizational culture
D) It helps to monitor environmental changes and adjust the strategy

Answer 6

A

Question 7

Strategic control systems, both informational and behavioral, are used to correct the performance and
ultimate strategy of a firm.

Answer 7

T

Question 8

Behavioral controls involve the ability to respond effectively to environmental change.

Answer 8

F. Informational controls

Question 9

Informational controls involve the balance and alignment of the culture, rewards, and boundaries of a
firm.

Answer 9

F. Behavioral controls

Question 10

What is the primary focus of Corporate Governance?
A) Ensuring that management can act without oversight
B) Ensuring that shareholders and their elected representatives (board of directors) hold management accountable
C) Maximizing short-term profits for shareholders
D) Allowing management to make decisions without shareholder input

Answer 10

B

Question 11

What is Management’s fiduciary duty under corporate governance?
A) To prioritize the immediate financial needs of the company
B) To maximize long-term shareholder value
C) To increase the company’s market share at any cost
D) To reduce employee wages to increase profits

Answer 11

B

Question 12

What is a potential consequence of poor corporate governance?
A) Increased accountability to shareholders
B) Enhanced long-term financial performance
C) Scandals or financial misreporting, leading to significant damage to the company’s reputation and value
D) Stronger alignment between management and shareholders

Answer 12

C

Question 13

Behavioral controls are aspects of strategic change that involve finding the appropriate ______________
and ______________ among the culture, rewards, and boundaries of the firm.
A. balance; alignment
B. measure; balance
C. alignment; balance
D. measure; outcome

Answer 13

A

Question 14

Tesco was forced to restate its earnings for the first half of 2014 to 431 million USD because senior
managers in the UK food business had booked income early and delayed the booking of costs in order to
improve appearances of financial performance. This scandal results from ____________ and
__________.
A. poor environment; management systems
B. poor governance; control
C. external environmental factors; internal environmental factors
D. leadership; financial systems

Answer 14

B

Question 15

What was the key issue in the Tesco scandal related to poor governance?
A) Senior managers invested heavily in stock buybacks instead of reinvesting in the business
B) Senior managers in the UK food business booked income early and delayed costs to improve the appearance of financial performance
C) Senior managers did not meet their revenue targets for the year
D) Senior managers failed to expand into international markets, resulting in lost growth opportunities

Answer 15

B

Question 16

How does poor governance affect a company’s financial reporting?
A) It leads to improved financial transparency
B) It can result in misreporting or manipulation of financial results, damaging the company’s reputation
C) It encourages stricter regulations and oversight
D) It ensures that all financial reports reflect actual earnings without manipulation

Answer 16

B

Question 17

Which type of informational control system is best suited for stable and predictable environments?
A) Contemporary Control Systems
B) Traditional Control Systems
C) Informational Control Systems
D) Behavioral Control Systems

Answer 17

B

Question 18

In what kind of environments are Contemporary Control Systems necessary?
A) Stable and predictable environments
B) Highly regulated environments
C) Unpredictable and complex environments
D) Environments with low competition

Answer 18

C

Question 19

Why is there a growing need for Contemporary Control Systems in modern business?
A) Because traditional systems are too complex for simple business environments
B) Because both general and competitive environments are becoming more unpredictable and complex
C) Because contemporary systems are cheaper to implement than traditional ones
D) Because traditional systems can adapt better to changing markets

Answer 19

B

Question 20

What is a key difference between Traditional and Contemporary Control Systems?
A) Traditional systems are more focused on external competition, while contemporary systems focus internally.
B) Traditional systems are better at handling volatility and uncertainty, while contemporary systems are more rigid.
C) Traditional systems work best in predictable environments, while contemporary systems are designed to handle uncertainty and complexity.
D) Contemporary systems are used only for financial control, while traditional systems handle broader management functions.

Answer 20

C

Question 21

In the Traditional Approach to Strategic Control, what is the first step in the process?
A) Performance measurement
B) Strategy formulation
C) Strategy implementation
D) Feedback analysis

Answer 21

B. Top manager sets goals

Question 22

What is a key characteristic of the Traditional Approach to Strategic Control in terms of time?
A) It operates in real-time with minimal time lag.
B) It typically involves long feedback loops, often tied to the annual planning cycle.
C) It focuses on short-term adjustments with quick feedback.
D) It is based on monthly reviews, allowing for rapid adjustments.

Answer 22

B

Question 23

The traditional approach to strategic control is interactive, while the contemporary approach to strategic
control is sequential.

Answer 23

F

Question 24

The traditional approach to strategic control relies on feedback from performance measurement to
formulate strategy.

Answer 24

T

Question 25

In the Traditional Approach to Strategic Control, what is the relationship between performance measurement and strategy formulation?
A) Performance measurement is independent of strategy formulation.
B) Strategy formulation occurs before performance measurement is conducted.
C) Performance measurement informs future strategy formulation through a feedback loop.
D) Strategy formulation occurs continuously without any performance measurement.

Answer 25

C

Question 26

What is a characteristic of the Traditional Approach to Strategic Control in terms of feedback loops?
A) Feedback loops are instantaneous, allowing for immediate strategy adjustments.
B) Feedback loops are based on monthly reviews, making adjustments quick.
C) Feedback loops are typically long and tied to the annual planning cycle of the firm.
D) Feedback is not used to inform future strategy but focuses only on operational tasks.

Answer 26

C

Question 27

For firms competing in highly unstable and turbulent industries, traditional strategic controls are most
appropriate.

Answer 27

F

Question 28

Which of the following is a key component of the Traditional Approach to Strategic Control?
A) Frequent adjustments based on external feedback
B) Continuous real-time performance measurement
C) Strategy formulation, implementation, and performance measurement with feedback loops
D) Lack of formal planning cycles

Answer: C) Strategy formulation, implementation, and performance measurement with feedback loops

Answer 28

C

Question 29

According to Chris Argyris, what is another name for the traditional control system?
A) Double-loop learning
B) Single-loop learning
C) Adaptive learning
D) Strategic learning

Answer 29

B

Question 30

Which of the following is a key feature of Single-loop learning in traditional control systems?
A) Constant revision of the company’s core strategy
B) Comparing actual performance to predetermined goals
C) Continuous and complex adjustments to goals
D) Use of advanced metrics to measure performance

Answer 30

B

Question 31

The Traditional Control System is most suitable for environments that are:
A) Highly unstable and unpredictable
B) Stable and simple
C) Highly competitive and fast-changing
D) Complex with numerous variables to measure

Answer 31

B

Question 32

Sales quotas, operating budgets, and production schedules are examples of traditional controls.

Answer 32

T

Question 33

In single-loop learning, the assumptions, premises, goals, and strategies of the organization are
continuously monitored, tested, and reviewed.

Answer 33

F. simply compare actual performance to a predetermined goal.

Question 34

Contemporary strategic controls involve comparing actual performance to predetermined goals

Answer 34

F. Traditional control system

Question 35

The traditional approach to strategic control is sequential. Which of the following is not one of the steps
in the sequence?
A. Action plans are submitted by lower level managers.
B. Performance is measured against the predetermined goal.
C. Strategies are implemented.
D. Strategies are formulated and top management sets goals

Answer 35

A. 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.

Question 36

Which of the following is the primary drawback of traditional strategic control systems?
A. They are only appropriate when the environment is stable and simple.
B. Goals and objectives cannot be measured with a high level of certainty.
C. They lead to complacency.
D. They lack the flexibility needed to adjust to changes in the environment

Answer 36

D

Question 37

Single-loop learning, according to Chris Argyris, is most appropriate when the environment is
___________, goals and objective can be measured with a _________ of certainty, and there is
________ need for complex measures of performance.
A. stable; high level; little
B. unstable; low level; great
C. stable; low level; great
D. unstable; high level; little

Answer 37

A

Question 38

For businesses facing complex and turbulent business environments, which of the following is true?
A. Goals and objectives that are uncertain prevent opportunism.
B. Traditional strategic controls are usually inappropriate.
C. Complacency about predetermined milestones can prevent adaptability.
D. Detailed plans are needed to maintain order.

Answer 38

B

Question 39

In a Traditional Control System, which of the following is typically used to measure performance?
A) Customer satisfaction metrics
B) Complex and predictive algorithms
C) Sales quotas, operating budgets, and production schedules
D) Environmental sustainability indicators

Answer 39

C

Question 40

Which of the following is NOT typically associated with Traditional Control Systems?
A) Performance tracking using simple metrics
B) Little need for complex measures of performance
C) Frequent revision of goals and objectives based on feedback
D) Goals and objectives can be measured with a high level of certainty

Answer 40

C

Question 41

Which of the following is a limitation of Traditional Control Systems in environments with high uncertainty?
A) They encourage flexible and adaptive responses to change.
B) They rely on simple, stable metrics that may not reflect changing market conditions.
C) They are effective in identifying new opportunities and risks.
D) They allow for the rapid adjustment of goals and strategies.

Answer 41

B

Question 42

How does the Contemporary Approach to Strategic Control differ from the traditional approach?
A) It is a sequential process with fixed stages.
B) It involves highly interactive relationships between strategy formulation, implementation, and control.
C) It focuses solely on performance measurement without feedback loops.
D) It emphasizes long feedback loops tied to annual planning cycles.

Answer 42

B

Question 43

What is a key characteristic of the Contemporary Approach to Strategic Control?
A) It relies on stable, predetermined goals and static performance measures.
B) It focuses on adapting to and anticipating both internal and external environmental changes.
C) It uses simple, fixed metrics like sales quotas and budgets.
D) It follows a rigid, linear process without room for adjustments.

Answer 43

B

Question 44

What distinguishes the Contemporary Approach to Strategic Control from the Traditional Approach?
A) The traditional approach focuses on adapting to changing environments, while the contemporary approach is rigid.
B) The contemporary approach is more interactive and flexible, while the traditional approach is sequential.
C) The traditional approach focuses on anticipating environmental changes, while the contemporary approach does not.
D) The contemporary approach relies on long feedback loops, while the traditional approach is immediate.

Answer 44

B

Question 45

Why is the Contemporary Approach to Strategic Control more effective in today’s business environment?
A) Because it focuses on long-term goals and objectives without change.
B) Because it can quickly adjust strategies in response to unpredictable changes in the environment.
C) Because it ignores internal changes and focuses only on external factors.
D) Because it operates in a rigid, fixed framework.

Answer 45

B

Question 46

In the contemporary approach to strategic control, adapting to and anticipating both internal and external
environmental change is an integral part. The relationships between _________, __________, and
__________ are highly interactive.
A. change; leadership; control
B. strategy formulation; leadership; control
C. strategy formulation; implementation; control
D. strategic information; organizational behavior; implementation

Answer 46

C

Question 47

Informational Control focuses on which of the following questions?
A) Are we implementing the strategy correctly?
B) Are we doing the right things?
C) Are we staying within budget?
D) Are we meeting employee performance goals?

Answer 47

B

Question 48

Behavioral Control focuses on which of the following?
A) Ensuring the organization is adapting to environmental changes.
B) Measuring whether the organization is doing the right things.
C) Ensuring the strategy is being implemented correctly.
D) Tracking financial performance against goals.

Answer 48

C. doing things right

Question 49

Both Informational and Behavioral Control are necessary for success, but:
A) Informational control alone is sufficient.
B) Behavioral control alone is sufficient.
C) Both are necessary but not sufficient by themselves.
D) Neither control is necessary for success.

Answer 49

C

Question 50

Informational control is primarily concerned with whether or not the organization is doing the right
things.

Answer 50

T

Question 51

What are the two different types of strategic control in the contemporary approach?
A) Informational control and behavioral control
B) Financial control and operational control
C) Internal control and external control
D) Tactical control and strategic control

Answer 51

A

Question 52

Informational Control focuses on:
A) Managing the organization’s financial performance.
B) Ensuring that organizational goals and strategies align with the current strategic context.
C) Monitoring only internal performance metrics like sales quotas.
D) Ensuring the workforce is motivated and aligned with the company’s mission

Answer 52

B. Focuses on the internal and external environment

Question 53

Which of the following factors shape the strategy in Informational Control?
A) Only internal organizational changes.
B) Only customer preferences and technology.
C) Technology, customer preferences, regulation, and industry competition.
D) Market prices and supply chain issues alone.

Answer 53

C. Focuses on the internal and external environment

Question 54

Key Issues for Managers in Informational Control include:
A) Monitoring only the internal environment.
B) Scanning and monitoring changes in both the external and internal environment.
C) Focusing exclusively on external competitive forces.
D) Monitoring financial data alone.

Answer 54

B

Question 55

Informational Control is a part of:
A) Fixed strategy execution processes.
B) Continuous organizational learning, particularly double-loop learning.
C) Periodic performance reviews.
D) Only assessing whether goals are being met.

Answer 55

B

Question 56

What is Double-Loop Learning in the context of Informational Control?
A) The process of assessing performance metrics without challenging underlying assumptions.
B) Continuously updating and testing the assumptions, goals, and strategies of the organization.
C) A strategy to ensure short-term goals are consistently met.
D) A one-time review of the strategy to make adjustments.

Answer 56

B

Question 57

What is a primary benefit of Informational Control in the contemporary approach?
A) It allows for long feedback loops to ensure thorough evaluation.
B) It reduces time lags by providing continuous monitoring and adjustments.
C) It focuses only on internal performance metrics without external influences.
D) It only monitors progress once a year for strategic updates.

Answer 57

B

Question 58

How does continuous monitoring in Informational Control enhance organizational agility?
A) It improves the ability to respond more slowly and cautiously to changes.
B) It helps in detecting changes in the competitive environment early and responding quickly.
C) It ensures a fixed, rigid approach to strategy implementation.
D) It reduces the need for organizational learning and adaptation.

Answer 58

B

Question 59

In Informational Control, managers must constantly scan and monitor the external environment to:
A) Focus on only internal operational efficiency.
B) Keep up with changes in regulations, competition, and customer preferences.
C) Ensure strict adherence to predetermined goals.
D) Monitor internal performance metrics exclusively.

Answer 59

B

Question 60

An example of Informational Control in action is:
A) Top managers at ABC Company meeting every Friday to review daily operational reports and year-to-date data.
B) Setting annual financial goals for the entire company without revisiting them.
C) Relying solely on annual strategic plans without considering changes in the market.
D) Focusing only on achieving the short-term objectives set at the beginning of the fiscal year.

Answer 60

A

Question 61

Continuous monitoring in Informational Control is beneficial because:
A) It ensures that there are no changes in the strategy.
B) It enhances the organization’s ability to respond with speed and flexibility to changes in the competitive environment.
C) It makes performance tracking less frequent.
D) It leads to slower decision-making processes in response to external factors.

Answer 61

B

Question 62

Continuous monitoring enhances the ability of the organization to respond with speed and flexibility.

Answer 62

T

Question 63

Double-loop learning in the contemporary approach to strategic control means that the organizational
assumptions, premises, goals and strategies are occasionally monitored, tested, and reviewed.

Answer 63

F. are continuously monitor

Question 64

Double-loop learning in the contemporary approach to strategic control helps to:
A) Eliminate the need for continuous monitoring and strategic adjustments.
B) Shorten time lags and enhance the organization’s ability to respond to changes.
C) Ensure a static approach to strategy.
D) Focus solely on internal organizational performance metrics.

Answer 64

B

Question 65

An effective contemporary control system focuses on:
A) Static information that remains consistent over time.
B) Constantly changing information with potential strategic importance.
C) Internal performance data alone, ignoring external factors.
D) Long-term trends that require infrequent updates.

Answer 65

B

Question 66

In an effective contemporary control system, information is important enough to:
A) Require occasional attention from top management.
B) Be analyzed only during annual performance reviews.
C) Require regular and frequent attention from all levels of the organization.
D) Be disregarded unless a crisis occurs.

Answer 66

C

Question 67

How is data and information best interpreted in an effective contemporary control system?
A) Through quarterly reports and written summaries.
B) By relying solely on data analysis software.
C) Through face-to-face meetings for discussion and interpretation.
D) By leaving the interpretation to the automated control system.

Answer 67

C

Question 68

The control system in a contemporary approach is used as:
A) A passive tool that only tracks financial performance.
B) A catalyst for an ongoing debate about underlying data, assumptions, and action plans.
C) A mechanism for strictly enforcing pre-determined goals.
D) A system that monitors only external market conditions

Answer 68

B

Question 69

How does an executive’s use of the control system impact the organization?
A) It signals to the organization that only financial goals are important.
B) It sends a clear message about the organization’s priorities and strategic focus.
C) It suggests that the control system is irrelevant to strategic planning.
D) It indicates that data analysis is secondary to operational decisions.

Answer 69

B

Question 70

What is one of the key benefits of interactive discussions within a contemporary control system?
A) They lead to slower decision-making processes.
B) They limit new strategies to incremental improvements only.
C) They often lead to new strategies and innovations.
D) They prevent executives from making quick adjustments.

Answer 70

C

Question 71

Contemporary approaches to strategic control rely primarily on
A. feedback controls.
B. single-loop learning.
C. double-loop learning.
D. comparative learning.

Answer 71

C

Question 72

Informational control systems are concerned with which of the following?
A. Is the organization doing things right?
B. Is the organization doing the right things?
C. Are rules and regulations being followed as information is processed?
D. Is the environment of the organization a necessary and sufficient condition for success?

Answer 72

B

Question 73

Continuous monitoring, in the contemporary approach, is beneficial because
A. it reduces time lags.
B. it increases the time it takes to detect changes in the competitive environment.
C. organizational flexibility is reduced.
D. organization response time is increased.

Answer 73

A

Question 74

Which of the following is not one of the characteristics of a contemporary control system?
A. It is a key catalyst for an ongoing debate about underlying data, assumptions, and action plans.
B. It must focus on constantly changing information that is strategically important.
C. It circumvents the need for face-to-face meetings among superiors, subordinates, and peers.
D. It generates information that is important enough to demand regular and frequent attention.

Answer 74

C

Question 75

Effective contemporary control systems require frequent and regular attention from all levels of the organization because:
A) It helps employees stay informed about their personal performance metrics.
B) The information is strategically important and can influence decision-making.
C) Information is static and does not require much attention once set.
D) The system only concerns top management and not the rest of the organization.

Answer 75

B

Question 76

Which of the following is NOT a characteristic of effective contemporary control systems?
A) Focus on constantly changing information.
B) Frequent face-to-face discussions to interpret data.
C) Focus exclusively on internal financial data.
D) Encouragement of ongoing debate and reevaluation of assumptions and strategies.

Answer 76

C

Question 77

What is the primary focus of behavioral control in strategic management?
A) The formulation of strategy.
B) The implementation of strategy—doing things right.
C) The assessment of external market conditions.
D) The monitoring of financial performance.

Answer 77

B

Question 78

Which of the following is NOT one of the three fundamental types of control levers for effective behavioral control?
A) Culture
B) Rewards and incentives
C) Technology and systems
D) Boundaries and constraints

Answer 78

C

Question 79

How can an organization pursue behavioral control?
A) Only by relying on one of the control levers: culture, rewards, or boundaries.
B) By focusing on external market conditions and adjusting strategy accordingly.
C) By using a combination of the control levers—culture, rewards, and boundaries—depending on internal and external factors.
D) By using technology alone to monitor performance.

Answer 79

C

Question 80

Why is culture and rewards critical in behavioral control within organizations?
A) They ensure that employees follow rigid rules and regulations.
B) They help align individual and organizational goals in a flexible way, especially in a dynamic competitive environment.
C) They replace the need for strategic planning and external market analysis.
D) They only serve to monitor financial performance and output.

Answer 80

B

Question 81

Why are rigid rules, strategies, and regulations less effective in today’s dynamic business environment?

a) They provide too much freedom for employees.
b) They hinder the ability to respond quickly and flexibly to changes.
c) They encourage employees to innovate more.
d) They promote greater coordination across organizational boundaries.

Answer 81

B

Question 82

. What is a key issue that firms face when downsizing and requiring more coordination across organizational boundaries?

a) The need for stricter rules and regulations.
b) The need for more centralized decision-making.
c) The dysfunctionality of a control system based on rigid strategies and boundaries.
d) A reduction in the importance of rewards and culture.

Answer 82

C

Question 83

How can firms align individual and organizational goals in a more flexible way?

a) By strictly enforcing rules and regulations.
b) By using rewards and culture to create alignment between individual and organizational objectives.
c) By focusing solely on financial incentives.
d) By limiting employee autonomy and innovation

Answer 83

b

Question 84

In a complex and unpredictable competitive environment, what is a dysfunctional approach to control systems?

a) Relying on a flexible approach to strategy and coordination.
b) Using a control system that is based on rigid rules, strategies, and boundaries.
c) Aligning individual goals with organizational culture.
d) Encouraging innovation and adaptability among employees.

Answer 84

B

Question 85

How do rewards and culture contribute to behavioral control in organizations?

a) By enforcing strict adherence to rules and guidelines.
b) By encouraging employees to work towards personal and organizational goals in a flexible way.
c) By restricting communication between organizational boundaries.
d) By focusing only on individual performance without considering the organization.

Answer 85

B

Question 86

Behavioral control is one of two types of strategic control and is concerned with strategy
implementation.

Answer 86

T

Question 87

As firms downsize, a control system based on rewards and culture becomes dysfunctional

Answer 87

F. a control system based primarily on rigid strategies, rules, and regulations is dysfunctional

Question 88

As firms simultaneously downsize and face the need for increased coordination across organizational
boundaries, a control system based primarily on ______________ is dysfunctional.
A. boundaries and
constraints
B. culture and rewards
C. organizational loyalty
D. innovation and risk taking

Answer 88

A

Question 89

What role do rewards and culture play in behavioral control, especially in a rapidly changing business environment?

a) They focus primarily on financial outcomes rather than organizational goals.
b) They create a flexible framework that aligns individual behavior with organizational objectives.
c) They reduce the need for employee collaboration.
d) They restrict employees’ ability to adapt to new challenges.

Answer 89

B

Question 90

For young managers who see themselves as free agents, behavioral controls such as rewards and culture
can be an effective way to enhance organizational loyalty.

Answer 90

T

Question 91

Why must culture, rewards, and boundaries work in a balanced and consistent manner?

a) To create an environment where flexibility and rigidity are combined.
b) To ensure that the organization’s leadership is unquestioned.
c) To achieve effective behavioral control within the organization.
d) To restrict employees from making autonomous decisions.

Answer 91

C

Question 92

What does organizational culture primarily consist of?

a) Strict rules and regulations that control employee behavior.
b) Shared values (what is important) and beliefs (how things work).
c) Clear financial rewards and boundaries that employees must adhere to.
d) A set of laws and regulations that guide employee actions.

Answer 92

B

Question 93

What is the role of organizational culture in shaping an organization?

a) It defines the rules for financial incentives and promotions.
b) It influences organizational structures, control systems, and behavioral norms.
c) It restricts employee creativity and innovation.
d) It provides a rigid framework for decision-making and behavior.

Answer 93

B

Question 94

How is culture described in the context of organizational performance?

a) Culture is intangible but has a significant and pervasive influence on the organization’s success or failure.
b) Culture is only a temporary influence on performance, fading over time.
c) Culture is a clear, measurable asset that can be directly linked to profits.
d) Culture is primarily focused on reducing organizational complexity.

Answer 94

A

Question 95

What is one of the main roles of strong leaders in regard to organizational culture?

a) They should maintain a focus solely on financial rewards for employees.
b) They should actively shape and manage the organizational culture as a key factor in strategic control.
c) They should impose strict boundaries and constraints on employee behavior.
d) They should remove all flexibility from the culture to maintain consistency.

Answer 95

B

Question 96

What do Collins and Porras (in Built to Last) argue is the key factor in sustained exceptional organizational performance?

a) Financial rewards and clear boundaries.
b) A strong, cultlike culture that is deeply ingrained within the organization.
c) Rigid rules and regulations for all employees.
d) The ability to quickly adapt to market changes without considering culture.

Answer 96

B

Question 97

What is one of the primary ways in which culture contributes to an organization’s competitive advantage?

a) By focusing solely on financial rewards for employees.
b) By setting explicit rules for every aspect of employee behavior.
c) By influencing the values that sustain the organization’s primary source of competitive advantage.
d) By enforcing rigid boundaries that limit employee creativity.

Answer 97

C

Question 98

What is one of the benefits of a strong organizational culture?

a) It increases the need for constant monitoring of employee behavior.
b) It helps reduce monitoring costs by creating shared norms and expectations.
c) It enforces strict job roles and responsibilities.
d) It encourages employees to act independently of organizational goals

Answer 98

B

Question 99

How does culture help maintain control within an organization?

a) By setting clear and explicit rules for all employees.
b) By creating unwritten standards of acceptable behavior and behavioral norms.
c) By focusing primarily on financial rewards and incentives.
d) By restricting employees’ ability to adapt to changing circumstances.

Answer 99

B

Question 100

What does culture do in terms of employee identification with the organization?

a) It encourages employees to focus only on personal goals.
b) It discourages employees from identifying with organizational objectives.
c) It encourages individual identification with the organization and its goals.
d) It forces employees to conform to rigid, external standards.

Answer 100

c

Question 101

What are implicit boundaries in the context of organizational culture?

a) Explicit rules and guidelines that must be followed by all employees.
b) Unwritten standards of acceptable behavior, such as dress codes, ethics, and business conduct.
c) Rigid boundaries that control all aspects of employee behavior.
d) Legal boundaries established by government regulations.

Answer 101

V

Question 102

Which of the following is not an example of how organizational culture exerts behavioral control?
A. Culture helps maintain control by creating behavioral norms.
B. Culture generates unwritten standards of acceptable behavior.
C. Culture encourages individual identification with the organization and its objectives.
D. Culture sets explicit boundaries.

Answer 102

D

Question 103

How is a strong organizational culture developed?

a) Through strict rules and regulations that control employee behavior.
b) By hiring employees based on financial incentives alone.
c) Through a strong commitment from leaders in both words and actions, and over time.
d) By focusing solely on external competition.

Answer 103

C

Question 104

Can an organizational culture become self-sustaining once it is established?

a) Yes, it naturally maintains itself without further effort.
b) No, it requires continuous effort from leaders to nurture and sustain it.
c) Yes, as long as the company follows strict guidelines.
d) No, it fades away as soon as the company downsizes.

Answer 104

B

Question 105

What is the primary method for building a viable and productive organizational culture?

a) Through immediate, drastic changes in rules and procedures.
b) By forcing employees to adopt company values.
c) By cultivating, encouraging, and “fertilizing” the culture over time.
d) Through external programs and workshops with little internal involvement.

Answer 105

C

Question 106

What is the main purpose of rallies or pep talks in reinforcing an organization’s culture?

a) To increase financial performance in the short term.
b) To inspire and motivate employees while reinforcing the company culture.
c) To establish strict rules and regulations for employees to follow.
d) To provide technical training for employees.

Answer 106

B

Question 107

The late Sam Walton, founder of Walmart, used to give pep rallies at local Walmart stores. What
purpose did this serve?
A. It was used to remind employees of Walmart rules and regulations.
B. It helped reinforce and sustain the Walmart culture.
C. It demonstrated to employees the importance of articulating explicit goals and objectives.
D. It made the Walmart reward system very explicit

Answer 107

B

Question 108

What is the role of a Culture Committee in an organization?

a) To establish and enforce company-wide rules and regulations.
b) To sustain and promote the organization’s core culture and values.
c) To focus on improving the organization’s financial performance.
d) To handle customer service complaints and issues.

Answer 108

B

Question 109

How are members of Southwest Airlines’ Culture Committee selected?

a) Based on their technical skills and experience.
b) Based on their exemplary customer service, enthusiasm, creativity, and teamwork.
c) Based on their seniority within the company.
d) Based on their ability to manage budgets and financials.

Answer 109

B

Question 110

What is the primary function of reward and incentive systems in organizations?

a) To reduce the need for leadership within the organization.
b) To influence an organization’s culture and motivate employees.
c) To focus only on financial performance metrics.
d) To increase employee job security.

Answer 110

B

Question 111

. How do reward and incentive systems act as a control mechanism in organizations?

a) By providing vague guidelines on how employees should perform their tasks.
b) By clearly specifying who gets rewarded and why they are rewarded.
c) By avoiding any connection to employee behavior and performance.
d) By focusing only on punishing poor performance.

Answer 111

B

Question 112

Which of the following is a key way that reward systems influence employees?

a) They motivate employees to focus on high-priority tasks and collective performance.
b) They restrict employees’ ability to make decisions about their work.
c) They are solely focused on maintaining job security.
d) They focus on rewarding only individual achievement without regard to team goals.

Answer 112

A

Question 113

How does the organizational reward system impact employees’ beliefs and behaviors?

a) By discouraging collaboration and team effort.
b) By acting as a powerful motivator, influencing their beliefs, behaviors, and attitudes.
c) By focusing solely on financial rewards and ignoring other motivational factors.
d) By maintaining rigid, rule-based control over employees.

Answer 113

B

Question 114

What is the role of reward and incentive systems in motivating collective performance within organizations?

a) They focus on rewarding only individual performance.
b) They encourage employees to compete against one another instead of working together.
c) They align rewards with collective goals and foster teamwork.
d) They have no impact on collective performance.

Answer 114

C

Question 115

Which of the following is not one of the characteristics of reward and incentive systems?
A. They represent a poor means of influencing the culture of an organization.
B. They focus efforts on high priority tasks.
C. They motivate high levels of individual and collective task performance.
D. They represent an effective control mechanism.

Answer 115

A

Question 116

What can happen if employees do not see a clear connection between their actions and rewards in an incentive system?

a) Employees will become more motivated to work harder.
b) Incentives can become demotivating, as employees feel their actions have little impact.
c) Employees will be more loyal to the organization.
d) Employees will work together to achieve organizational goals.

Answer 116

B

Question 117

What is a potential problem when incentives are too closely tied to individual performance?

a) Employees become focused on teamwork and collaboration.
b) Employees may engage in dysfunctional behaviors that harm the organization.
c) Incentives become less effective in motivating employees.
d) It leads to higher financial rewards for the organization.

Answer 117

B

Question 118

What could happen to a sales representative incentivized by sales volume?

a) They might only focus on high-value sales.
b) They may engage in undesirable practices, like accepting unprofitable sales to meet targets.
c) They will always choose the best customers for the company.
d) They will stop working to avoid any risk of failure.

Answer 118

B

Question 119

Individual rationality ______________ organizational rationality.
A. is a good indicator of
B. will ensure
C. is often the opposite
of
D. does not always guaranteevIndividual rationality ______________ organizational rationality.
A. is a good indicator of
B. will ensure
C. is often the opposite
of
D. does not always guarantee

Answer 119

D

Question 120

Once a strong and healthy organizational culture has been established, it becomes self-sustaining.

Answer 120

F. Once a strong and healthy organizational culture has been established, it becomes self-sustaining. Once a strong and healthy organizational culture has been established, it becomes self-sustaining.

Question 121

The collective sum of individual behaviors of the employees of an organization generally results in what
is best for the organization; thus, individual rationality assures organizational rationality.

Answer 121

F

Question 122

What is a common result when different organizational units have separate reward systems?
A) Increased cohesion across units
B) Development of subcultures within the organization
C) Streamlined decision-making
D) Enhanced overall organizational performance

Answer 122

B

Question 123

Which of the following is NOT a factor that can influence the differences in reward systems across organizational units?
A) Industry context
B) Stage of the product life cycle
C) Size of the organization’s office spaces
D) Business situation

Answer 123

C

Question 124

hat can happen when reward systems across different units reinforce different behavioral norms and attitudes?
A) Improved inter-unit cooperation
B) Reduction in cohesiveness within the organization
C) Better resource allocation
D) Unified organizational vision

Answer 124

B

Question 125

When reward systems lead to subcultures with different shared values, what is a likely outcome?
A) Employees begin working in harmony towards common goals
B) Information hoarding instead of sharing across units
C) An increase in organizational trust
D) A more collaborative environment

Answer 125

B

Question 126

How can differences in reward systems across functional areas impact organizational goals?
A) They can help clarify and strengthen overall organizational objectives.
B) They can cause employees to lose sight of the overall organizational goals.
C) They help improve the efficiency of all business units.
D) They ensure alignment with the organizational mission and values.

Answer 126

B

Question 127

The organizational reward system is typically a weak method for motivating employees.

Answer 127

F

Question 128

Different functional areas within an organization often have different reward systems

Answer 128

T

Question 129

The organizational reward system is typically a weak method for motivating employees.

Answer 129

F

Question 130

When subcultures emerge that have shared values opposite from the dominant culture of an
organization
A. organizational cohesiveness increases.
B. information is shared rather than hoarded.
C. individuals begin working at cross purposes.
D. individuals gain insights into overarching goals and objectives.

Answer 130

C

Question 131

What is a key characteristic of an effective reward and incentive system?
A) It should be independent of the company’s mission.
B) It should reinforce core values and the company’s mission.
C) It should reward individual performance only.
D) It should prioritize short-term gains over long-term goals.

Answer 131

B

Question 132

An effective reward and incentive system should enhance:
A) Competition between employees
B) Cohesion and commitment to the organization’s goals
C) Individual recognition at the expense of teamwork
D) Financial compensation only

Answer 132

B

Question 133

How should reward and incentive systems align with an organization’s goals?
A) They should align with the organization’s short-term goals only.
B) They should be in conflict with the organization’s mission to foster innovation.
C) They should align with the organization’s overall goals and strategy.
D) They should be separate from the organization’s overall strategy.

Answer 133

C

Question 134

Rewards systems that reinforce the core values of the organization and contribute to organizational
cohesiveness are the least effective type.

Answer 134

F

Question 135

What is a key feature of an effective incentive system?
A) Lack of clear objectives
B) Clear objectives that are well understood and accepted by employees
C) Unclear goals to encourage flexibility
D) Rewards unrelated to performance

Answer 135

B

Question 136

what is a probable cause of motivated self-interest within an organization?
A) Clear understanding of organizational goals
B) Lack of a clear understanding of organizational goals and objectives
C) Effective communication of performance measures
D) Timely and clear feedback on performance

Answer 136

B

Question 137

How should rewards be linked to performance in an effective incentive system?
A) Rewards should be based on random selection.
B) Rewards must be clearly linked to performance and the desired behaviors.
C) Rewards should be given irrespective of performance.
D) Rewards should be distributed equally without regard to performance.

Answer 137

B

Question 138

Which of the following is NOT a characteristic of an effective reward system?
A) Clear objectives that are well understood by employees
B) A direct link between rewards and performance
C) Feedback that is delayed and unclear
D) Fair and equitable compensation

Answer 138

C

Question 139

For a reward system to be effective, it must be perceived as fair and equitable.

Answer 139

T

Question 140

Which of the following is not a characteristic of effective reward and incentive systems?
A. Performance measures are clear and highly visible.
B. The structure is fixed to assure employees of consistency.
C. The compensation system is perceived as fair and equitable.
D. Objectives are well understood, and broadly accepted.

Answer 140

B

Question 141

Lack of a clear understanding of organizational goals and objectives is a probable cause of
A. productive behavior.
B. counterproductive motivation.
C. counterproductive behavior.
D. motivated self-interest.

Answer 141

D. Counterproductive behavior can arise because of motivated self-interest, lack of a clear understanding of
goals and objectives, or outright malfeasance.

Question 142

What is a potential cause of counterproductive behavior in organizations?
A) Clear and well-defined organizational goals
B) Motivated self-interest, lack of clear understanding of goals, or outright malfeasance
C) Strong organizational boundaries and constraints
D) Focus on strategic priorities

Answer 142

B

Question 143

What purpose do boundaries and constraints serve in guiding organizational behavior?
A) They prevent innovation and creativity.
B) They maintain order and align individual efforts with strategic priorities.
C) They promote individual autonomy and eliminate teamwork.
D) They limit the scope of organizational goals and objectives.

Answer 143

B

Question 144

How can boundaries and constraints help align individual efforts within an organization?
A) By focusing efforts on personal goals and achievements
B) By ensuring employees work independently of the company’s strategic goals
C) By aligning individual and team efforts with the organization’s key goals
D) By encouraging employees to take risks that conflict with organizational objectives

Answer 144

C

Question 145

Boundaries and constraints are just used to maintain order in an organization and have little effect on the
strategic priorities of the organization.

Answer 145

F

Question 146

Which company example is given to illustrate the use of boundaries and constraints to refocus on core goals?
A) Pfizer sold its infant formula business to concentrate on core pharmaceutical products.
B) Apple divested its technology consulting services to focus on retail operations.
C) Microsoft sold its gaming division to refocus on cloud computing.
D) IBM sold its software division to focus on hardware development.

Answer 146

A

Question 147

What is a key characteristic of effective short-term objectives?
A) They should be vague and open to interpretation.
B) They should be general and non-specific.
C) They should be specific and measurable.
D) They should be aligned only with individual goals, not organizational goals.

Answer 147

C

Question 148

How do short-term objectives and action plans help in an organization?
A) By allowing employees to pursue personal goals without organizational direction
B) By creating boundaries that channel efforts toward specific, measurable goals
C) By eliminating the need for strategic planning
D) By allowing teams to ignore long-term objectives

Answer 148

B

Question 149

What is one of the benefits of setting boundaries and constraints in an organization?
A) They reduce the need for organizational goals and objectives
B) They improve the efficiency and effectiveness of organizational processes
C) They create more opportunities for organizational chaos and confusion
D) They encourage employees to work independently from the organization’s priorities

Answer 149

B

Question 150

Short-term objectives and action plans are types of boundaries that channel the efforts of employees
toward goal accomplishment.

Answer 150

T

Question 151

How did Steve Jobs use whiteboards at Apple to improve organizational focus?
A) He used them for brainstorming creative ideas.
B) He set clear priorities by identifying top initiatives and eliminating others.
C) He used them to communicate daily tasks to employees.
D) He relied on them for detailed financial projections.

Answer 151

B

Question 152

During a retreat, what method did Steve Jobs use to prioritize initiatives?
A) He selected 10 initiatives and divided them equally among employees.
B) He identified 10 potential initiatives, then focused on the top 3, eliminating the bottom 7.
C) He encouraged employees to choose their preferred initiatives.
D) He used a voting system to determine the top 3 priorities.

Answer 152

B

Question 153

Why is it important for nonprofit organizations to maintain legitimacy with their benefactors?
A) To increase revenue and attract more donations.
B) To ensure ethical boundaries are respected and foster trust with donors.
C) To reduce overhead costs by focusing solely on large donations.
D) To focus on maximizing profits for the organization.

Answer 153

B

Question 154

Which of the following is a characteristic of effective short-term objectives?
A) They should be vague and open to interpretation.
B) They should be flexible and lack clear deadlines.
C) They should be specific, measurable, and have a clear time horizon.
D) They should only focus on long-term goals.

Answer 154

C

Question 155

What is the purpose of making short-term objectives “achievable yet challenging”?
A) To ensure objectives are impossible to reach, encouraging extreme effort.
B) To motivate managers by setting realistic goals that still require effort to achieve.
C) To make objectives easy, so they do not require much effort or planning.
D) To set goals that do not require any managerial involvement.

Answer 155

B

Question 156

Short-term objectives should allow enough flexibility to:

A) Adapt to changes in the external environment.
B) Follow rigid processes without deviation.
C) Ensure no change occurs during the short-term period.
D) Prevent the company from reacting to new government regulations.

Answer 156

A

Question 157

How should short-term objectives help a company respond to new government regulations?

A) By remaining rigid and ignoring government changes.
B) By preparing the company to adjust to new regulations promptly.
C) By preventing any internal policy changes.
D) By focusing exclusively on competitors’ actions.

Answer 157

B

Question 158

Which of the following is a situation that short-term objectives should enable a company to react to?

A) A competitor introducing a substitute product.
B) An internal company restructuring.
C) A decrease in employee satisfaction.
D) Increased employee turnover.

Answer 158

A

Question 159

Short-term objectives should allow a company to adjust to changes in:

A) Only company internal operations.
B) Changes in consumer tastes.
C) Long-term strategic goals.
D) The preferences of shareholders alone.

Answer 159

B

Question 160

Unexpected events have little effect on short-term objectives because short-term objectives are not
changeable.

Answer 160

F

Question 161

What is the primary role of action plans in strategy execution?
a) To create flexibility for managers to change strategies frequently.
b) To implement strategies with clarity on what needs to be done and when.
c) To avoid scheduling key activities.
d) To reduce the focus on resource allocation.

Answer 161

B

Question 162

Why must action plans be specific?
a) To ensure that managers have a clear understanding of the resource requirements for implementing the plan.
b) To allow managers to skip unnecessary steps.
c) To encourage improvisation during execution.
d) To make long-term objectives irrelevant.

Answer 162

A

Question 163

What could happen if action plans are not specific?
a) Managers may over-allocate resources to projects.
b) Managers may not think through all resource requirements for implementation.
c) Strategies may be implemented faster than planned.
d) Managers may become too focused on short-term objectives

Answer 163

B

Question 164

Action plans permit a degree of autonomy for managers who sometimes must modify activities to
achieve the desired outcome.

Answer 164

T. Short-term objectives must provide proper direction and also provide enough flexibility for the firm to
keep pace with and anticipate changes in the external environment. Unexpected events within a firm may
require a firm to make important adjustments in both strategic and short-term objectives.

Question 165

Effective boundaries and constraints
A. tend to inhibit efficiency and effectiveness.
B. distract employees who are trying to focus on organizational priorities.
C. minimize improper and unethical conduct.
D. tend to limit organizational growth.

Answer 165

C

Question 166

Effective short-term objectives should be ______________ and _____________.
A. specific; measurable
B. achievable; not challenging
C. motivating; not limiting
D. time defined; not limiting

Answer 166

A

Question 167

Which of the following statements about action plans is true?
A. Action plans should permit a degree of autonomy to managers and not be constrained by budgets.
B. Action plans must be specific so that managers will have a clear understanding of the resource
requirements necessary to implement the plan.
C. Action plans should not be constrained by a time frame in order to allow for modification.
D. Management accountability often erodes their motivation to implement the plan on a timely basis.

Answer 167

B

Question 168

Rule-based controls are most effective in organizations with which of the following characteristics?

a) High levels of innovation and creativity
b) Stable and predictable environments
c) Highly skilled and independent employees
d) A focus on customer-centric customization

Answer 168

B

Question 169

Which of the following is an example of a situation where rule-based controls would be most appropriate?

a) A technology startup with a team of software engineers
b) A fast-food chain with a standardized menu and mass production
c) A law firm with highly specialized attorneys
d) A creative agency focused on advertising campaigns

Answer 169

B

Question 170

Rule-based controls are LEAST appropriate in organizations where:

a) There is a high risk of malfeasance and fraud
b) Products and services must be consistent across different locations
c) Employees are highly skilled and independent
d) The environment is stable and predictable

Answer 170

C

Question 171

In which of the following industries would rule-based controls be most important due to the high risk of malfeasance or unethical behavior?

a) Creative agencies
b) Casinos and banking
c) Technology startups
d) Healthcare providers

Answer 171

B

Question 172

Which of the following is a reason rule-based controls are used in industries like manufacturing of mass-produced products?

a) To ensure creative freedom for employees
b) To maintain consistency in products and services
c) To foster independent decision-making among workers
d) To adapt quickly to changing market trends

Answer 172

B

Question 173

Which of the following is a feature of an organization where rule-based controls are MOST beneficial?

a) Employees work independently with minimal oversight
b) Products and services are customized for each customer
c) Employees perform repetitive and predictable tasks
d) The market environment is highly dynamic and uncertain

Answer 173

C

Question 174

Rule-based controls are commonly implemented in organizations that prioritize:

a) Individual creativity and personal initiative
b) Efficiency and consistency in operations
c) High levels of employee autonomy
d) Rapid response to market changes

Answer 174

B

Question 175

Rules and regulations are examples of ______________ and _____________.
A. controls; behaviors
B. controls;
norms
C. boundaries; behaviors
D. boundaries;
constraints

Answer 175

D

Question 176

The best way to minimize improper and unethical conduct is to ________ and _______.
A. set boundaries;
constraints
B. establish standards; guidelines
C. develop policies; regulations
D. design sanctions; guidelines

Answer 176

A

Question 177

Which of the following approaches to behavioral strategic control would be the least appropriate for an
organization in which there is a great need for innovation and a high degree of autonomy?
A. culture
B. rewards
C. rule
s
D. incentives

Answer 177

C

Question 178

Most successful organizations minimize the need for explicit rules, regulations, and other boundaries by
A. posting written statements of the organizational goals and objectives.
B. discouraging the formation of subcultures that isolate work groups.
C. designing effective reward systems.
D. encouraging employees to see themselves as free agents.

Answer 178

C

Question 179

Rule-based controls are least appropriate in organizations with which one of the following
characteristics?
A. Environments are stable and predictable.
B. Employees are highly skilled and independent.
C. There is consistency in product and service.
D. The risk of malfeasance is extremely high.

Answer 179

B

Question 180

Rules and regulations, rather than culture or rewards, would be used for strategic control at which type
of company?
A. software developer
B. stock brokerage firm
C. manufacturer of mass produced products
D. high tech research facility

Answer 180

C

Question 181

Which of the following is a key purpose of ethical guidelines in an organization?

a) To encourage innovative business practices
b) To specify acceptable practices with customers and suppliers
c) To promote employee independence and decision-making
d) To minimize operational costs

Answer 181

B

Question 182

The Sarbanes-Oxley Act (2002) increased penalties for financial reporting misdeeds. What was one of the outcomes of this regulation?

a) CFOs began enforcing stricter ethical standards in their organizations
b) Employees were given more autonomy over financial decision-making
c) Financial reporting became more lenient and less monitored
d) Companies reduced their focus on internal controls and audits

Answer 182

A

Question 183

What is the best way to minimize improper and unethical conduct in an organization?

a) Set clear performance targets for employees
b) Set boundaries and constraints to guide behavior
c) Reward employees for independent decision-making
d) Focus solely on financial performance and profitability

Answer 183

B

Question 184

Regulations backed up with strong sanctions do not help an organization avoid conducting business in an
unethical manner.

Answer 184

F

Question 185

Which of the following is NOT minimizing improper and unethical conduct

a) Specifying proper relationships with customers and suppliers
b) Prohibiting any form of payment, bribe, or kickback
c) Setting performance targets for all employees
d) Helping to minimize improper and unethical conduct

Answer 185

C

Question 186

Boundaries and constraints, when used properly, can minimize improper and unethical conduct.

Answer 186

T.

Question 187

What is one of the primary functions of boundaries and constraints within an organization?

a) To encourage employees to work independently without oversight
b) To minimize improper and unethical conduct
c) To increase competition within the company
d) To allow for greater flexibility in decision-making

Answer 187

B

Question 188

What is commonly prohibited by many organizations in their rules regarding commercial practices?

a) Offering discounts for bulk purchases
b) Any form of payment, bribe, or kickback
c) Making long-term business plans
d) Negotiating favorable terms with suppliers

Answer 188

B

Question 189

Rule-based controls are appropriate in organizations, where most of the employees are unskilled.

Answer 189

T

Question 190

What is the primary focus of behavioral control in organizations?

a) Reducing operational costs
b) Achieving organizational goals and managing behavior through various control mechanisms
c) Promoting creativity and innovation among employees
d) Increasing market share through aggressive sales tactics

Answer 190

B

Question 191

Which of the following is a key factor influencing control mechanisms within an organization?

a) Size of the organization
b) Organizational culture
c) Market share
d) Geographic location

Answer 191

B. Key factors influencing control: orgnaizational culture; rewards and incentives, contraints based on internal and external factor

Question 192

In high-tech firms, such as those focused on basic research, which factor plays a crucial role in managing behavior?

a) Rewards and incentives
b) Detailed performance measurements
c) Internalized norms and values
d) External regulations and constraints

Answer 192

C

Question 193

The three fundamental types of control are culture, rewards and leadership, boundaries and constraints.

Answer 193

F

Question 194

In high-tech firms working under high uncertainty and complexity (e.g., R&D), performance is often difficult to measure. Which of the following best describes the approach to behavioral control in such organizations?

a) Strict external supervision and micromanagement
b) Performance-based rewards like commissions or bonuses
c) Control based on internalized norms, values, and autonomy
d) Reliance on bureaucratic procedures and formal rules

Answer 194

C

Question 195

In organizations where performance is easier to measure, such as in sales, which factor is likely to influence behavior?

a) Internalized norms and organizational culture
b) Long lead times in R&D
c) Rewards like commissions or bonuses
d) Highly formalized rules and regulations

Answer 195

C

Question 196

Which of the following best describes the control mechanisms used in bureaucratic organizations?

a) Highly informal and flexible structures with minimal rules
b) Dependence on members following a highly formalized set of rules and regulations
c) High levels of autonomy with minimal oversight
d) Control through innovation and creative freedom

Answer 196

B

Question 197

What is a key characteristic of culture in professional organizations such as law firms, hospitals, or universities?

a) Rigid and formal rules that must be followed by all employees
b) A system of unwritten rules that influence employee behavior
c) A focus on strict hierarchical control and supervision
d) Detailed written policies that dictate all aspects of work

Answer 197

B. Culture

Question 198

In organizations like law firms or universities, employees are often experts in their field. How does this impact the control mechanisms in place?

a) Employees are closely monitored and must follow detailed instructions
b) Employees are given high levels of autonomy and trusted to make decisions independently
c) Employees are required to adhere to rigid bureaucratic structures
d) Employees are constantly required to report every decision to higher management

Answer 198

B

Question 199

How does organizational culture in professional environments, like law firms or universities, differ from bureaucratic organizations?

a) It emphasizes the following of detailed written rules and procedures
b) It relies on trust, autonomy, and internalized norms rather than formal rules
c) It focuses primarily on measurable output and performance metrics
d) It has little to no impact on how employees behave or make decisions

Answer 199

B

Question 200

What are “rules” in the context of behavioral strategic control?

a) Informal guidelines that employees are expected to follow
b) Written and explicit guidelines that provide external constraints on behavior
c) Strategies for encouraging creativity and innovation among employees
d) Policies that reward employees based on innovation and performance

Answer 200

B

Question 201

In which type of organizational environment are rules most appropriate as a control mechanism?

a) When tasks are highly creative and require innovation
b) When tasks are repetitive and routine with little need for creativity
c) When employees have high levels of autonomy and decision-making power
d) When the organization is pursuing an unrelated diversification strategy

Answer 201

B

Question 202

Rules are most appropriate in organizations where:

a) Tasks are creative and require frequent innovation
b) There is little need for standardized output or routine tasks
c) Tasks are repetitive and routine, with little need for creativity or innovation
d) Employees have high autonomy and are encouraged to make independent decisions

Answer 202

C

Question 203

What is the primary purpose of using rewards in an organization?

a) To control employee behavior through strict rules and regulations
b) To motivate employees through performance-based incentives
c) To encourage employees to innovate and take risks
d) To monitor and measure employee behavior on a daily basis

Answer 203

C

Question 204

When are rewards most appropriate as a control mechanism in an organization?

a) When tasks are highly creative and require independent thinking
b) When performance is difficult to measure or assess
c) When the organization is pursuing unrelated diversification strategies with different business areas
d) When employees are primarily driven by internal motivations and autonomy

Answer 204

C

Question 205

How is performance typically measured when using rewards in an organization?

a) By subjective assessments and evaluations from managers
b) By straightforward, objective measurements of output and performance
c) By the number of rules followed by employees
d) By peer reviews and team-based evaluations

Answer 205

B

Question 206

How can rewards be used alongside other control mechanisms, such as cultural norms or rules?

a) To replace the need for cultural norms or rules in the organization
b) To serve as an additional motivator, reinforcing other methods of control
c) To increase employee autonomy by eliminating the need for rules
d) To ensure that employees ignore the organization’s values and norms

Answer 206

B

Question 207

What is the primary benefit of creating a strong organizational culture?

A) To increase the number of rules and regulations
B) To internalize boundaries and reduce the need for external controls
C) To focus on financial incentives only
D) To avoid hiring employees who fit the organizational values

Answer 207

B

Question 208

How should organizations align their reward systems to ensure success?

A) By offering rewards that contradict the organization’s goals
B) By designing rewards that are clearly aligned with the organizational goals and objectives
C) By focusing rewards on individual performance only
D) By minimizing rewards to reduce costs

Answer 208

B

Question 209

What type of people should organizations aim to hire for long-term success?

A) People with diverse values and inconsistent attributes
B) People who do not identify with the dominant values of the organization
C) People who identify with the dominant values of the organization and have consistent attributes
D) People with no previous experience in the organization’s field

Answer 209

C

Question 210

The need for rules and regulations can be minimized if the organization has a strong culture. There is no
necessity to have a system of rewards and incentives as well.

Answer 210

F. There is necessity to have a system of rewards and incentives

Question 211

Most organizations with strong cultures and a sound system of rewards and incentives can eventually
internalize boundaries rather than use explicit rules and regulations. Which of the following is not a
technique for moving in that direction?
A. Hire people who identify with the dominant values of the organization.
B. Develop managerial role models.
C. Minimize training and
indoctrination.
D. Align reward systems with organizational goals and objectives.

Answer 211

C

Question 212

What is one way organizations can ensure their reward systems are effective?

A) By hiring people who do not share the organization’s values
B) By providing training, managerial role models, and clear alignment with goals
C) By focusing only on financial rewards
D) By discouraging managerial involvement in decision-making

Answer 212

B

Question 213

Hiring is important in organizations, especially hiring the right people who already identify with the
dominant values of the organization and have attributes that are consistent with them.

Answer 213

T

Question 214

Why is training crucial for organizations?

A) To increase the number of rules employees must follow
B) To internalize the culture of the organization and foster group identity
C) To teach employees how to avoid conflict
D) To provide personal growth without aligning with the company’s culture

Answer 214

B

Question 215

In building strong reward and incentives, it is vital to have good managerial role models

Answer 215

T

Question 216

What role do managerial role models play in creating an effective organizational culture?

A) They set examples that minimize the need for bureaucratic rules and enhance the culture
B) They focus on increasing profits through strict regulations
C) They impose rigid rules to maintain control over employees
D) They avoid participating in organizational culture-building activitie

Answer 216

A

Question 217

How did Andy Grove, former Intel CEO, contribute to Intel’s organizational culture?

A) By establishing a large set of rules for employees to follow
B) By minimizing bureaucratic rules and working alongside employees
C) By emphasizing the need for first-class travel for executives
D) By focusing only on the financial rewards for employees

Answer 217

B

Question 218

Reward systems need to be aligned clearly with the organizational goals and objectives, as demonstrated
by Marks and Spencer and their sustainability efforts.

Answer 218

T

Question 219

Culture, a system of unwritten rules that forms and internalized influence over behavior, is often found
in professional organizations.

Answer 219

T