182 test bank for strategic management a dynamic perspective concepts first 1st

Test Bank for Strategic Management A Dynamic
Perspective Concepts First 1st
85 Test Bank True – False Questions
29 Test Bank for Free Text Questions
68 Test Bank Multiple Choice Questions

Multiple Choice Questions - Page 1
Loblaw International Merchants intended to license its
President’s Choice merchandising program in the U.S.
Which of the following was not a factor of economic
logic for E.D. Smith to consider an alliance with
Loblaw’s?
1.
2.
3.

A) E.D. Smith’s national licenses for half of the sauces it sold
B) E.D. Smith’s declining volume in national brands
C) E.D. Smith’s national brand losing market position against larger US
competitors
4. D) E.D. Smith’s reliance on Loblaw’s for controlled labels

Once the vision has been created, the business’s present
situation needs to be examined to ensure that the
vision can be achieved given the company’s
______________.
1.
2.
3.
4.

A) suppliers
B) CEO
C) history
D) resources

The planned process is also known as the ____________
approach.
1.
2.
3.
4.

A) integrated
B) emergent
C) stakeholder
D) designed

Which of the following is not a step in the visioned process?
1.
2.
3.
4.

A) sell the vision
B) create the vision
C) alter the vision
D) establish pre-conditions


The planned approach implies relatively _____ certainty

about what needs to be done and works well in ______
situations.
1.
2.
3.
4.

A) high, dynamic
B) high, stable
C) low, dynamic
D) low, stable

Matsushita planned to become a super manufacturing
company by doing all of the following except:
1.
2.
3.
4.

A) expansion of R&D and IT
B) becoming interactive with customers
C) providing solutions instead of goods
D) moving from a flat organization to a pyramid

The planned process involves analyzing the external
environment, which is subject to driving forces. Which
of the following is not a driving force of evolution?
1.
2.
3.

4.

A) economy
B) society
C) technology
D) capabilities

Which of the following is not an important part of selling the
vision?
1.
2.
3.
4.

A) employees understanding where the company is heading
B) open communication with employees
C) ensuring the vision is abstract enough
D) commitment from top management

The Xerox turnaround plan featured all of the following
actions except?
1.
2.
3.
4.

A) aggressively reducing costs
B) outsourcing research and development
C) improving productivity in operations
D) reducing the amount of risk faced

Which of the following is one of the conditions that need to
be achieved before visioning can be conducted
successfully?
1.
2.
3.

A) management providing top-down communication
B) an understanding of why the vision is being created
C) a pool of reserve funds designated to support the vision


4.

D) temporary inactivity from competitors

The concept of “pre-conditions” can best be described by
which of the following?
1.
2.
3.
4.

A) the analysis of conditions which are present in successful competitors
B) the changing of current conditions to allow for the enacting of the vision
C) the establishment of conditions to allow a visioning exercise to take place
D) the development of conditions which help a company exploit its competitive
advantage

Management’s intent is provided through a(n)
__________________.
1.
2.
3.
4.

A) policy and procedures manual
B) statement of values
C) annual report
D) vision statement

Which of the following is the best description of a vision
statement?
1.
2.
3.
4.

A) a statement of the firm's values and purposes
B) a declaration of what the firm stands for
C) a statement of the firm's measurable outcomes
D) a statement of what the firm will be in the future

“Fit” has also been called ______________.
1.
2.
3.
4.

A) coherence
B) intertwining
C) efficiency
D) effectiveness

The weakness of the planned process is that the necessary
______ are not always available to do complete
analysis.
1.
2.
3.
4.

A) tools
B) employees
C) concepts
D) information

Which of the following provides a common superior goal?
1.
2.
3.
4.

A) principles
B) values
C) mission
D) vision

As a part of implementation, _________________ are
developed to overcome the riskiest aspects of the
choice.
1.
2.
3.
4.

A) contingency plans
B) resource inputs
C) strategic levers
D) alternatives

An effective vision answers which of the following
questions?
1.
2.
3.
4.

A) Who are our stakeholders?
B) How do we get to the other side?
C) Where will we be in 10 years?
D) What is our competitive advantage?

Strategic leadership is concerned with the following except:
1.
2.
3.
4.

A) innovation
B) certainty
C) strategic change
D) performance

Which of the following is not one of the conditions that need
to be achieved before visioning can be conducted
successfully?
1.
2.
3.
4.

A) an effective social network
B) open and clear communication
C) openness to change
D) identification of key stakeholders to consider

Effective strategic leaders craft vision statements because
________.
1.
2.
3.
4.

A) they are the basis for a balanced scorecard
B) they provide measurable outcomes
C) they provide a rigid framework for strategic management
D) they influence strategy formulation and implementation

Longer vision statements are meant to be more
___________________.
1.
2.
3.
4.

A) clearly understood
B) directive
C) remembered
D) communicated


Strategic leadership is typically overseen by the board of
directors, and usually involves which of the following
company employees?
1.
2.
3.
4.

A) manufacturing
B) former CEOs
C) top management
D) retail

Implementing a strategic solution requires identifying the
necessary ______ changes to all of the following
except:

1.
2.
3.
4.

A) resource
B) incremental
C) organizational
D) strategic

Matsushita’s plan was to adapt to the business
environment’s changing requirements in all of these
areas except:
1.
2.
3.
4.

A) marketing
B) R&D
C) asset acquisition
D) IT

According to the text, Xerox mixed together which of the
following three approaches to strategic leadership?
1.
2.
3.
4.

A) discovered, visioned, and planned
B) intended, discovered, and visioned
C) realized, visioned, and planned
D) realized, intended, and visioned

Strategic leadership is managing an overall enterprise and
influencing key ________.
1.
2.
3.
4.

A) organizational outcomes
B) stakeholders
C) managers
D) strategic initiatives

The three main alternatives the E.D. Smith had concerning a
potential U.S. venture with Loblaw’s did not include:
1.

A) declining the offer and continue growing the controlled label business in
Canada
2. B) building a new plant in China


3.
4.

C) building a new plant in the U.S.

D) buying an existing plan in the U.S.

The U.S. market was most attractive to E.D. Smith and
Loblaw’s due to which of the following factors?
1.
2.
3.
4.

A) U.S. food retailers were regional companies
B) U.S. customers were not familiar with the E.D. Smith brand
C) the large U.S.-based competitors were driving down prices and profitability
D) the U.S. market was 10 times larger

The ultimate importance of the visioned process is the
___________________.
1.
2.
3.
4.

A) end result
B) process itself
C) mission statement
D) vision statement

Which of the following is not a weakness of the visioned
process?
1.
2.

3.
4.

A) translating it into action is hard work
B) the vision may not be concrete enough to be useful by itself
C) the vision is initiated by one person and negotiated through with others
D) the vision encourages behaviours that are demotivating

Which of the following is not a question that Informix CEO
Robert Finocchio could ask of his company to
determine whether it was acting ethically?
1.
2.
3.
4.

A) Are our reward structures appropriate?
B) Do we face new technological challenges?
C) How will we measure our performance?
D) Do we face new legal requirements?

The process of managing a well-planned and well-executed
transition from one CEO to another is called ________.
1.
2.
3.
4.

A) succession planning
B) leadership planning

C) managerial development
D) human resource planning

Without a vision of where the business is trying to go, a
company loses ______________.
1.
2.
3.
4.

A) efficiency
B) conflict resolution
C) competitive advantage
D) resource commitments


68 Free Test Bank for Strategic Management A
Dynamic Perspective Concepts First Canadian
Edition 1st Edition Carpenter Multiple Choice
Questions - Page 2
Which of the following is not one of the five cognitive
biases?
1.
2.
3.
4.

A) recency effect
B) prior hypothesis
C) escalating commitment

D) illusion of control

The discovered process produces a business strategy that
evolves over time as the business adapts to changes
in all of the following except:
1.
2.
3.
4.

A) organizational culture
B) society
C) technology
D) politics

For the discovered process to work, management has to
create a culture with all of the following except:
1.
2.
3.
4.

A) inquisitiveness
B) nonconformity
C) perfectionism
D) open-mindedness

The total approach to strategic leadership is successful for
which of the following reasons?
1.

2.
3.
4.

A) each process must work independently
B) intended strategy is based on all three approaches
C) a blended approach improves the quality of strategic decisions
D) a company is unable to take the best advantage of the overall situation

Robert Campeau, a highly successful builder in Canada, had
his decision making affected by cognitive biases,
which led to his failed mergers. Which of the following
is not an example of a cognitive bias that impacted
Campeau?
1.
2.

A) He assumed his success in Canada would transfer to the U.S.
B) He discovered information that confirmed his expectations about the success of
the mergers.


3.

C) He paid careful attention to any information that indicated he was
overestimating the potential of the mergers.
4. D) He drew on his Wall Street experience to dominated negotiations.

The ability of individuals to generate ideas can be enhanced
through various techniques except which of the

following:
1.
2.
3.
4.

A) customer interviewing
B) mining proprietary technology
C) cross-fertilization
D) groupthink

Leaders of most businesses have created statements of
values that are called all of the following except:
1.
2.
3.
4.

A) corporate credo
B) corporate objectives
C) corporate values
D) corporate principles

During the dot-com boom of the late 1990s many young
people and investors looked at the success of Amazon
and Yahoo! and assumed they could achieve the same
level of success. This produced a massive wave of
start-ups working with the internet as individuals
sought to capitalize on the perceived opportunities.
The dot-com crash in 2000 showed that the market was

able to sustain far fewer companies than founders and
investors thought. This is an example of which
cognitive bias?
1.
2.
3.
4.

A) reasoning by analogy
B) illusion of control
C) how representive
D) prior hypothesis

A decision maker with a strong prior belief about the
relationship between two variables makes decisions
based on that belief even though evidence has been
presented that is wrong. This is an example of which
cognitive bias?
1.
2.
3.
4.

A) reasoning by analogy
B) illusion of control
C) how representive
D) prior hypothesis


In the discovered process, innovation comes from which of

the following sources?
1.
2.
3.
4.

A) top management
B) employees
C) customers
D) shareholders

Decision-making bias under which people are willing to
commit additional resources to a failing course of
action is called ________.
1.
2.
3.
4.

A) illusion of control
B) illusion of optimism
C) escalation of commitment
D) self-serving fairness bias

Which of the following is not a tactic used in playing
politics?
1.
2.
3.
4.

A) driving a personal agenda
B) taking personal credit for work done by others
C) withholding information
D) overemphasizing work done by others

Anne Mulcahy of Xerox used the discovered process when
she:
1.
2.
3.
4.

A) engaged top management in planning
B) empowered people to find new things to do
C) provided a vision
D) selected a strategic solution after careful analysis

Innovation can be stymied in all of the following ways
except:
1.
2.
3.
4.

A) a bureaucratic control system
B) an organizational culture favouring stability
C) inspiring others to support new ideas
D) employees unwilling to make mistakes

What is the main challenge that management faces when
pruning/fertilizing ideas?
1.
2.
3.
4.

A) quashing compatible ideas
B) quashing potentially beneficial ideas
C) nurturing less desirable ideas
D) nurturing potentially beneficial ideas


Mental maps are used to produce more complex thought
structures. This is an attempt to overcome the
weaknesses of which cognitive bias?
1.
2.
3.
4.

A) reasoning by analogy
B) illusion of control
C) how representive
D) prior hypothesis

The best “pruning” of innovations occurs when management
imposes some rationale on the innovations the
business accepts and builds. This is due to which of
the following factors?

1.
2.
3.
4.

A) clarity over growth projections
B) breadth of compatible innovations
C) insufficient resources to support all innovations
D) depth of analysis of the external environment

The discovered process can be best described as:
1.
2.
3.

A) top management generating strategic ideas and selecting some to further
B) people throughout the company generating strategic and executing ideas
C) top management generating strategic ideas and people throughout the
company selecting some to further
4. D) people throughout the company generating strategic ideas from which
management has selected some to further

The values of an individual can contradict the conclusions of
logical analysis, producing what seems to be
_______________.
1.
2.
3.
4.

A) irrational behaviour
B) centralized decision-making
C) management by objectives
D) playing politics

Which of the following is not included as part of the process
of thought known as cognition?
1.
2.
3.
4.

A) perception
B) intellect
C) reason
D) memory


Decisions are affected by the judgments we all make about
what is desirable and undesirable in a given situation.
These judgments are based on _____________.
1.
2.
3.
4.

A) perception
B) stereotyping
C) memory
D) values

Ethics do which of the following?
1.
2.
3.
4.

A) drive decisions by what they say is right
B) shape the values of shareholders
C) constrain decisions by what they say is wrong
D) shape the values of those working in the business

The desires and interests of the individuals involved in
strategic leadership falls under which human
influence?
1.
2.
3.
4.

A) economic power
B) values and ethics
C) cognitive biases
D) power and politics

Innovations quickly installed are those that require little
effort, have a big impact and are easily reversed if they
prove wrong. This approach has been called:
1.
2.

3.
4.

A) fail early and fail often
B) succeed early and fail later
C) fail early and succeed later
D) succeed early and fail often

If the Board of Directors hires a new CEO on the basis that
he or she will produce specific results, this is an
example of ____________.
1.
2.
3.
4.

A) politics
B) groupthink
C) mandates
D) strategy

Failures committed under groupthink include all of the
following except:
1.
2.
3.

A) developing after-the-fact rationalizations
B) focusing only on objective analysis
C) filtering out information

4.

D) not questioning underlying assumptions

With the discovered process, decisions that help craft
strategy may be all of the following except:
1.
2.
3.
4.

A) planned
B) urgent
C) piecemeal
D) interim

All of the following are part of innovation in the discovered
process except ________.
1.
2.
3.
4.

A) service innovation
B) process revolution
C) continuous process improvement
D) long-term action horizons

Management can select innovations using all of the following
processes except:
1.

A) treating newly formed solutions as technically rational in conditions of
uncertainty
2. B) treating newly formed solutions as tentative until proven
3. C) sort innovations based on the impact of the solution
4. D) sort innovations based on the effort needed to install the solution

The trait that can lead people to give themselves more credit
for their successes and take less responsibility for
their failures is ________.
1.
2.
3.
4.

A) compassion
B) passiveness
C) aggressiveness
D) confidence

Which of the following is a key characteristic of the
discovered process?
1.
2.
3.
4.

A) envisionment of a desired future
B) no distinguishing between formulation and implementation
C) internal and external analysis
D) focus on the decision making itself

A leader whose values tend toward being market-driven will
focus their actions on which of the following
strategies?
1.
2.

A) serving customers in the selected arena
B) growing the business through alliances


3.
4.

C) choosing conservative strategies that minimize downside risk
D) looking for ways for the business to be on the leading edge of technology

According to the text, the discovered process assumes that
the environment is ________.
1.
2.
3.
4.

A) stable
B) predictable

C) changing slowly
D) complex

The three main aspects of human behaviour affecting the
strategic leadership processes are:
1.
2.
3.
4.

A) cognition, power and politics, values and ethics
B) power and politics, values and ethics, collaboration
C) cognition, power and politics, collaboration
D) cognition, values and ethics, collaboration

True - False Questions - Page 1
The first step in any strategic analysis is always to describe
the current strategy.
1.
2.

True
False

A visioning exercise cannot begin without all six preconditions being established.
1.
2.

True
False

The visioning process is less important than the vision
statement.
1.
2.

True
False

Vision is a simple statement or understanding of what the
firm will be in the future.
1.
2.

True
False

To behave in ways consistent with the vision is to sell the
vision.
1.
2.

True
False


The compatibility between relationships within strategy,
resources and capabilities, and the environment is
known as fit.
1.

2.

True
False

Anne Mulcahy provided Xerox employees with a fictitious
description of what the company had become in the
future. This is an example of a vision.
1.
2.

True
False

Strategic leadership is exercised more by top individuals
than teams of top executives.
1.
2.

True
False

The concept of fit has also been called coherence.
1.
2.

True
False

The planned process is adept at dealing with uncertainty and

complexity.
1.
2.

True
False

The implementation of a planned strategic solution has lower
risk due to certainty.
1.
2.

True
False

Vision statements inform managers and employees of the
firm's direction.
1.
2.

True
False

The decisions about strategic leadership are made at the
very top of the organization.
1.
2.

True
False

If a company invests money to move into a new market but
does nothing to differentiate itself from competitors,
this is a misfit.
1.
2.

True
False

The drawback of the planned process is that it cannot be
applied at the functional and product levels.
1.
2.

True
False

The planned process implies low certainty about what needs
to be done.
1.
2.

True
False

Better vision statements are usually simple and brief.
1.
2.

True
False

Clearly articulated vision statements may be used as
substitutes for strategy.
1.
2.

True
False

Matsushita is making changes in role, investment, and
organization. These changes will “fit together” if the
organization performs better.
1.
2.

True
False

When decisions are made that do not line up with the initial
decisions, this is called “stretching the organization.”
1.
2.

True
False

The expansion of Loblaw International Merchants into the

U.S. gave E.D Smith an alliance opportunity that
allowed for easier access into the American market.
1.
2.

True
False


The planned process is attractive because it allows
management to consider how to make the business
both efficient and effective.
1.
2.

True
False

A misfit is a resource decision that does not fit with the
organization’s strategy.
1.
2.

True
False

The appeal of the planned process is that it can be applied at
all levels of strategy.
1.
2.

True
False

Alternatives should not be mutually exclusive.
1.
2.

True
False

The resources needed for implementation are analyzed
before providing alternative strategic solutions.
1.
2.

True
False

The planned process can use both quantitative and
qualitative analysis.
1.
2.

True
False

The key steps of the visioning process are to establish the
pre-conditions needed for visioning to be successful,
create the vision, sell the vision and express the

vision.
1.
2.

True
False

Because they are general and ambiguous, vision statements
serve little strategic purpose.
1.
2.

True
False


Vision statements enable organizations the flexibility to
change strategy or implementation tactics since it
does not impose conditions on how the business gets
there.
1.
2.

True
False

A contingency plan helps to minimize risk by being an
alternative if the plan is not being achieved.
1.
2.

True
False

E.D. Smith and Sons Ltd. decided to buy a plant in the U.S.
so that they could quickly manufacture products for
Loblaw International Merchants.
1.
2.

True
False

The single most important component of Xerox’s turnaround
strategy was communication.
1.
2.

True
False

Thanks in part to E.D. Smith, the President’s Choice
merchandising program was a success in the U.S.
1.
2.

True
False

Because organizations are complex, management must rely

on only one of the planned, visioned, and discovered
approaches to strategic leadership.
1.
2.

True
False

Misfits, as long as they are strategically important, will not
cause poor performance now or in the future.
1.
2.

True
False

Xerox management reduced costs by $600 million largely by
reducing research and development costs.
1.

True


2.

False

According to the planned process, lower managers put a
strategy in place to move the business where it needs
to be.

1.
2.

True
False

The Xerox near monopoly was first challenged by Microsoft.
1.
2.

True
False

Most often the vision is initiated by one person.
1.
2.

True
False

Vision statements have little effect unless stakeholders are
willing to participate in pursuing them.
1.
2.

True
False

A mission is a description of what the business is doing.
1.

2.

True
False

85 Free Test Bank for Strategic Management A
Dynamic Perspective Concepts First Canadian
Edition 1st Edition Carpenter True - False
Questions - Page 2
The level of ethical behaviour in an organization is set by
ethical codes and not the business leaders.
1.
2.

True
False

The most effective strategic leadership uses a singular
process to lead.
1.
2.

True
False

The discovered process focuses on the decision making as
opposed to the results of the decisions.
1.

True

2.

False

The great catalyst within Dofasco to reinvent the company
was technology.
1.
2.

True
False

Prior hypothesis bias allows decision makers to use
information that is inconsistent with their beliefs.
1.
2.

True
False

The tendency of the decision maker to overestimate their
ability to control events based on a strong prior belief
about the relationship between the two decision
variables is an example of the illusion of control.
1.
2.

True

False

Strategic decision-makers may not appreciate the full
implications of their decisions within the discovered
process of strategic leadership.
1.
2.

True
False

A leader’s values will impact the choice of arenas or vehicles
he or she tends to utilize in strategic decision making.
1.
2.

True
False

Management can treat innovative solutions as tentative until
they prove themselves. This will generate more ideas
than sorting solutions based on the effort needed to
install the solution.
1.
2.

True
False

Using the planned, visioned, and discovered processes at

the same time is feasible.
1.
2.

True
False


The issue of what is “right” is becoming easier as
businesses become global and populations more
diverse.
1.
2.

True
False

If values are used as a benchmark for employee behaviour
and company performance, they give management
indirect control over people’s behaviour.
1.
2.

True
False

When management fails to impose rationale on the
innovations the business accepts and builds, it is
known as “fail early, fail often.”
1.

2.

True
False

Strategic innovation is a key feature of the discovered
process.
1.
2.

True
False

A business strategy that evolves over time benefits those
with the best information about the market
opportunities.
1.
2.

True
False

If centralized decision making seems to be orderly and
rational, politics must not be in play.
1.
2.

True
False

The dot-com crash in 2000 was due in a large part to the
illusion of control.
1.
2.

True
False


The ability to translate a vision into behaviours for workers
at all levels is the biggest strength of the visioned
process.
1.
2.

True
False

Escalation of commitment could be due to groupthink.
1.
2.

True
False

Tunnel vision trap occurs when the vision drives the actions
of management even though it is no longer
achievable.
1.
2.

True
False

Innovation requires justifying mistakes.
1.
2.

True
False

The challenge with ethics is not determining which set of
values is “right,” but which corporations should
develop codes of ethical behaviour.
1.
2.

True
False

Traditional music companies using enforcement of their
copyrights to bring customers back to them is an
example of escalating commitment.
1.
2.

True
False

In a fragmented industry, conditions are less dynamic and

require more of a planned approach.
1.
2.

True
False

Cognition is the process of thought, including perception
and reason but not memory.
1.
2.

True
False


An effective tactic is more morally correct than an ineffective
tactic.
1.
2.

True
False

With innovation often coming from employees in the
discovered process, top management plays little role
in orchestrating the process.
1.
2.

True
False

A Board of Directors may have a mandate top pursue newer
technologies. This mandate is a form of organizational
power and politics.
1.
2.

True
False

Reasoning by analogy is weakest when the two situations
are similar in superficial ways.
1.
2.

True
False

The best strategic decisions are based in part on values.
1.
2.

True
False

The supermarket is an example of a retail format that was
used as an analogy by future retailers.
1.

2.

True
False

Continuous innovation requires structure and few mistakes.
1.
2.

True
False

Escalation of commitment is a person's belief that he or she
is in greater control of a situation than rational
analysis would support.
1.
2.

True
False


Cross-fertilization is putting employees together with
customers.
1.
2.

True
False

Escalating commitment is based more on a rational
commitment of resources than the feeling of personal
responsibility for the strategy.
1.
2.

True
False

When a decision maker thinks back to a previous decision to
transfer lessons to the present situation, he or she is
using the prior hypothesis bias.
1.
2.

True
False

Honda’s decision to compete in smaller motorcycles in the
U.S. market based on the initial reactions of
consumers was a form of organizational learning.
1.
2.

True
False

Cognition is a bias that impacts how humans reach
decisions.
1.

2.

True
False

“Using power” and “playing politics” have no place in
managing an organization.
1.
2.

True
False

Human factors influence strategic leadership processes
primarily at the start of the process.
1.
2.

True
False


If an executive assumes that the decision variables for
diversifying into a new market will be the same as with
previous successful diversifications, this is an
example of prior hypothesis bias.
1.
2.

True

False

The discovered process includes people throughout the
company generating strategy.
1.
2.

True
False

The phrase escalation of commitment indicates that
committing more resources to a failing strategy is an
irrational decision.
1.
2.

True
False

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29 Free Test Bank for Strategic Management A

Dynamic Perspective Concepts First Canadian
Edition 1st Edition Carpenter Free Text
Questions
Explain the concept of “stretching the organization” and how
it relates to fit.
Answer Given

Sometimes, initial decisions relating to strategy may not seem to fit but do so as
further decisions are made that line up with the initial decisions. This is said to be
“stretching the organization.” An example of stretch appears in Exhibit 2.1, which
shows Matsushita Electric, the Japanese parent company of Panasonic, stretching
the company to become a “Super Manufacturing Company.” Such a company,


explains Matsushita CEO Kunio Nakamura, “must in essence be ‘light and speedy’
Now when the nature of business is changing, emphasis will be placed on the
maintenance, broadening and strengthening of IT, on R&D, and marketing.
Moreover, Matsushita at present is like a heavy lead ball loaded with assets. In the
future we need to cast off superfluous assets and become a company that can
move lightly like a soccer ball.” Fit is the condition in which all decisions made by
management may support each other but at a minimum do not contradict each
other. An implicit assumption of top management is that when various decisions “fit
together,” the organization will perform better. The idea of fit has also been called
alignment and coherence. Without fit, decisions contradict each other, causing
confusion, ineffectiveness, and inefficiency.

How can firms use corporate values or principles to motivate
employee behaviour?
Answer Given

These serve as a framework that guides the conduct of all those in the business.
They tell all employed there is a right way to do things and expect people “to do
things right.” They are used as a benchmark for judging individual behaviour and
company performance. In doing so, they give management indirect control over
people’s behaviour. The individual can judge personal performance against the
criteria provided by the statement. This comparison influences the individual’s selfesteem and motivation. When individuals identify with the organization’s values,
they are induced to identify with the organization’s objectives. These objectives
become part of their personal goals, and their behaviour is aimed at accomplishing
them.

What are the four ways that innovation can be stymied in an
organization?
Answer Given

First, a strong hierarchy working with an elaborate and bureaucratic (top-down)
control system gives managers greater ability to block ideas and innovations that
do not fit with their own views. Second, a strong organizational culture that prefers
stability can limit innovation by challenging new ideas and demeaning them based
on previous experience. Third, individuals in the organization may not have the
necessary mindset for innovation. Fourth, championing an idea requires
individuals with certain talents. They have to overcome cultural inertia and political
barriers by inspiring others to support their new ideas.

What should vision statements encompass and why should
management use them?
Answer Given

The vision statement is a description of the desired future state of the company. It
is the answer to the question, “What will this business be in 10 or 20 years?” The
vision statement in practice ranges from a word, to a statement three pages long,

or even a picture. Better statements are usually simple and brief, thus easily
understood and remembered. Longer statements are more of a plan that, while