Strategy Chapter 10

The key to leveraging a core competence into a distinctive competence (or a capability into a competitively superior capability) is a. concentrating more effort and more talent than rivals on deepening and strengthening the competence or capability, so as to achieve the dominance needed for competitive advantage. b. concentrating more effort and more talent than rivals on capturing strategic fits and resource fits so as to drive the costs of performing value chain activities progressively lower over time. c. molding the efforts and work products of individuals into a collaborative effort to imitate how best-in-industry or best-in-world companies perform a particular activity. d. doing a better job than rivals of training employees in the process of identifying and adopting best practices. e. empowering company personnel to be creative and innovative in finding and implementing ways to perform each and every value chain activity consistently well and at an acceptable cost.

a

The disadvantages of centralized organizational structure include: a. longer response times in deciding upon a course of action and discouraging lower-level managers and rank-and-file employees from exercising initiative. b. impairing cross-unit coordination and the creation of dynamic competencies and capabilities. c. making it hard to fix accountability when things do not go well. d. too many limitations on top management control. e. placing too much decision making authority in the hands of lower-level company personnel.

a

Which one of the following is not an execution related benefit of outsourcing? a. Reducing the risk of being stuck with stale or obsolete competencies and capabilities b. Improving a company's chances for outclassing rivals in the performance of strategy-critical activities and turning a core competence into a distinctive competence c. Capitalizing on the partnerships with outsiders to enhance its arsenal of capabilities and thus contribute to better strategy execution d. Helping decrease internal bureaucracies and flatten the organizational structure e. Speeding internal decision making and shortening the time it takes to respond to changing market conditions

a

Which one of the following statements is incorrect as concerns the managerial task of executing strategy? a. Executing strategy is primarily the function of a company's chief executive officer and other senior-level managers--it is their responsibility to see that strategy is executed successfully and their job to decide how to proceed and to personally supervise the details of the strategy execution process. b. It is a whole lot easier to develop a sound strategic plan than it is to execute the plan and achieve the desired outcomes. c. Just because senior managers announce a new strategy doesn't mean that organizational members will agree with it or enthusiastically move forward in implementing it. d. The managerial tasks of implementing and executing strategy are primarily operations-driven activities revolving around the management of people and business processes. e. What really makes executing strategy a tougher, more time-consuming management challenge than crafting strategy is the wide array of managerial activities that must be attended to, the many ways to put new strategic initiatives in place and keep things moving, and the number of bedeviling issues that always crop up and have to be resolved.

a

Building organizational bridges with strategic partners and external allies is aided by a. grouping all value chain activities involving strategic partners and allies under a single top executive who has sole responsibility and authority for working with strategic partners and external allies, coordinating all the joint efforts, and realizing the hoped-for benefits of all such collaborative efforts. b. appointing "relationship managers" with responsibility for getting the right people together, promoting good rapport and information-sharing, nurturing interpersonal cooperation and communication, and ensuring effective coordination. c. having weekly meetings will all strategic partners/allies to discuss the progress being made in collaborating and achieving the intended benefits of the collaborative effort. d. forming a task force of knowledgeable company personnel and giving them full authority to manage and coordinate the process of collaborating with all strategic partners and external allies. e. creating a special department to coordinate all collaborative efforts with strategic partners and external allies.

b

One of the big weaknesses of traditional functional organizational structure is a. making it hard to reduce the layers of management and streamline decision-making. b. that pieces of strategically relevant activities and capabilities often end up scattered across many departments, with the result that no one group or manager is accountable—remedying this deficiency often entails reengineering the work effort and pulling the people who performed the pieces in functional departments into a group that works together to perform the whole process, thus creating process departments. c. making it very difficult for the organization to operate as cost effectively as may be needed to be cost-competitive with rivals. d. discouraging lower-level managers and rank-and-file employees from being creative and exercising initiative. e. making it difficult to have closely related activities report to a single executive.

b

The advantages of a centralized organization structure include: a. requiring employees to wait to be told what to do (thus reducing the risk of bad decision-making on the part of empowered employees), fewer layers of management, and speedy decision-making b. reduced potential for conflicting actions and decisions on the part of lower-level managers, facilitation of strong top management leadership in crisis situations, and tight control by the manager in charge--it is easy to know who is accountable when things do not go well. c. higher-quality decision-making, a small management bureaucracy, and tight top management control. d. promoting greater motivation and involvement in the business on the part of more company personnel, making top management more accountable, and giving top managers tight control of operations in crisis situations. e. allowing fast response times in making decisions (because fewer managers are involved in the decision-making process), fewer levels of decision-making, and a smaller managerial bureaucracy.

b

Which of the following is generally not among the practices that companies use to staff jobs with the best people they can find? a. Encouraging employees to challenge existing ways of doing things, to be creative and innovative in proposing better ways of operating, and to push their ideas for new products or businesses b. Weeding out the 15% lowest performing employees each year and replacing them with more talented and motivated job applicants c. Making the work environment stimulating and engaging such that employees will consider the company a great place to work d. Spending considerable effort in screening and evaluating job applicants, selecting only those with suitable skill sets, energy, initiative, judgment, and aptitudes for learning and adaptability to the company's work environment and culture e. Rotating people through jobs that not only have great content but also span functional and geographic boundaries

b

Which of the following is not among the principal managerial components of the strategy execution process? a. Instilling a corporate culture that promotes good strategy execution b. Selecting capable employees, training employees properly, and doing an effective job of empowering employees c. Installing information and operating systems that enable company personnel to carry out their strategic roles proficiently d. Steering the needed resources to execution-critical value chain activities e. Exercising strong leadership to drive execution forward, make needed corrective adjustments, and move toward companywide operating excellence as rapidly as feasible

b

Which of the following statements about creating dynamic and competitively valuable competencies and capabilities is false? a. The organization momentum that comes from astute and timely managerial efforts to develop a formidable portfolio of dynamic capabilities is often sufficient to keep a company's sales and profit performance humming. b. Most companies keep their portfolio of competencies and capabilities fresh and dynamic by either acquiring another company with recently remodeled resource capabilities or by entering into collaborative partnerships with suppliers that are highly regarded for their innovativeness and cutting-edge know-how. c. The imperatives of keeping a company's capabilities matched to ongoing changes in both market conditions and its own circumstances, coupled with the normal buildup of knowledge and experience over time, makes it appropriate to view a company as a bundle of evolving competencies and capabilities. d. The managerial challenge in building a dynamic set of competencies and capabilities that delivers good results in the marketplace is one of deciding when and how to recalibrate existing competencies and capabilities, and either having the foresight or spotting opportunities to develop altogether new kinds of competencies and capabilities. e. Competencies and capabilities grow stale unless they are refreshed, modified, or even phased out and replaced.

b

Which one of the following falsely characterizes a centralized organizational structure? a. Comparatively little discretionary authority is granted to frontline supervisors and rank-and-file employees. b. Promoting the establishment of a collegial, collaborative work environment where decisions are made only after seeking the opinions and advice of many managerial and non-managerial personnel and arriving at a general consensus as to the best course of action. c. Front-line supervisors and rank-and-file employees can't be relied upon to make the right decisions because they seldom know what is best for the organization and because they do not have the time or inclination to properly manage the tasks they are performing (letting them decide "what to do" is thus risky). d. Tight control by the manager in charge makes it easy to fix accountability when things do not go well. e. Top executives retain authority for most strategic and operating decisions and keep a tight rein on business-unit heads, department heads, and the managers of key operating units.

b

Which one of the following statements falsely characterizes the managerial task of executing strategy? a. Executing strategy is an action-oriented, make-things-happen task. b. What really makes executing strategy a tough, time-consuming management challenge is the long, drawn out process of trial-and-error experimentation required to identify and implement effective approaches to strategy execution. c. Ideally, senior managers need to create a companywide crusade to implement and execute the chosen strategy as fast and effectively as possible. d. Successful strategy execution depends on doing a good job of working with and through others, building and strengthening competitive capabilities, motivating and rewarding people in a strategy-supportive manner, and instilling a discipline of getting things done. e. Executing strategy is a job for a company's whole management team, not just top executives.

b

The three components of building an organization capable of good strategy execution are: a. (1) organizing the work effort, (2) doing a good job of training and motivating company personnel, and (3) streamlining the performance of value chain activities. b. hiring a capable top management team, empowering employees, and organizing the work effort. c. (1) staffing the organization, (2) acquiring, developing and strengthening the resources, competencies, and capabilities important to good strategy execution, and (3) structuring the organization and work effort--as shown in Figure 10.2. d. implementing a cost-efficient organization structure, hiring a capable top management team, and properly empowering employees--as shown in Figure 10.2. e. (1) deciding which value chain activities to perform internally and which ones to outsource, (2) implementing a cost-efficient organization structure, and (3) developing dynamic competencies and capabilities.

c

The two best signs of good strategy execution are: a. a strong commitment to centralized decision-making and a concerted effort to revamp the company's value chain in a manner that promotes high levels of operating efficiency. b. a strong and capable top management team and a lineup of dynamic and competitively valuable core competencies. c. whether the company is meeting or beating its performance targets and has attained real proficiency in performing strategy-critical value chain activities. d. policies and procedures that facilitate rather than impede good strategy execution and a cost-efficient value chain. e. a strong lineup of core competencies and properly trained and empowered employees.

c

Which of the following statements about putting together a capable top management team is false? a. It is important to ferret out and replace managers who believe activities in their area of responsibility are already being done properly or lack the creativity to find ways to operate more cost-efficiently and cost-effectively. b. The most important consideration is to fill key managerial slots with smart people who are clear thinkers, good at figuring out what needs to be done, and skilled in "making it happen" and delivering good results. c. Hiring capable managers is important in building an organization capable of proficient strategy execution but is nearly always less crucial than doing a superior job of hiring, training, and empowering employees. d. Without a smart, capable, results-oriented management team, the implementation-execution process ends up being hampered by missed deadlines, misdirected or wasteful efforts, and/or managerial ineptness. e. It helps enormously when a company's top management team has several people who are particularly good change agents—true believers who champion change, know how to make it happen, and love every second of the process.

c

Delegating greater authority to subordinate managers and employees: a. is a risky decision-making approach because it usually results in lots of "bad" decisions. b. usually slows down decision-making because so many more people are involved and it takes longer to reach a consensus on what to do and when to do it. c. aids the capture of strategic fit benefits across related businesses. d. creates a more horizontal organization structure with fewer management layers and usually acts to shorten organizational response times. e. can be a de-motivating factor because it requires people to take responsibility for their decisions and actions and then be held accountable for the actions they take--most employees prefer to be told what to do by the manager they work for.

d

Making those organizational units performing strategy-critical value chain activities the main building blocks in the enterprise's organizational scheme: a. promotes greater cost efficiency and maximum resource fit and lowering the costs of dynamically managing the company's collection of evolving competencies and capabilities. b. improves the productivity of geographically-scattered organizational units. c. has the advantage of shortening the time it takes to build powerful core competencies and competitive capabilities. d. has the advantages of giving these organizational units the resources, decision-making influence, and organizational visibility they need to execute their piece of the strategy capably. e. has the benefits of simplifying the task of empowering employees and of streamlining decision-making.

d

Management's handling of the process of implementing and executing a company's strategy can be considered successful a. if and when the company is able to build a powerful lineup of dynamic and competitively valuable core competencies and has a critical mass of well-trained, motivated, and empowered employees. b. if the company has a streamlined and decentralized organization structure and has the right kinds of dynamic skills, competencies, and competitive capabilities. c. if and when strategy-critical value chain activities are being performed efficiently and management has done a good job of structuring and organizing the work effort (as shown in Figure 10.3). d. if a company is meeting or beating its performance targets and can perform strategy-critical value chain activities with real proficiency. e. if and when the company is able to revamp its value chain in a manner that promotes high levels of operating efficiency.

d

One of the disadvantages of a decentralized structure featuring employee empowerment is: a. the difficulties of delegating authority in ways that allow organization units and individuals to do things in the best way they see fit. b. how to keep empowered employees from making lots of stupid decisions. c. the time and costs associated with empowering lower-level managers and employees. d. how to exercise enough control over the actions and decisions of empowered employees so that the business is not put at risk in the event that empowered employees happen to make some unwise decisions. e. how to avoid de-motivating employees (because empowered employees feel threatened by having to take responsibility for their actions and decisions).

d

Which of the following statements about dynamically managed competencies and capabilities that are fresh and on the cutting edge is false? a. A company's competencies and competitive capabilities must be continually refreshed and recalibrated to remain aligned with changing customer expectations, ever-evolving competitive conditions, and a company's own strategic initiatives to outcompete rivals. b. The managerial challenge in building a dynamic set of competencies and capabilities that delivers good results in the marketplace is one of deciding when and how to recalibrate existing competencies and capabilities, and either having the foresight or spotting opportunities to develop altogether new kinds of competencies and capabilities. c. The organization momentum that comes from astute and timely managerial efforts to develop a formidable portfolio of dynamic capabilities is often sufficient to keep a company's sales and profit performance humming. d. The quickest, cheapest, and most reliable way to refresh and strengthen a company's portfolio of competencies and capabilities is by either acquiring another company with dynamic and attractive resource capabilities or by entering into collaborative partnerships with suppliers or other companies having cutting-edge expertise. e. It takes freshly honed, cutting-edge competencies and competitive capabilities to stay abreast of ongoing changes in customer needs and expectations, to successfully combat competitors' newly launched offensives to win bigger sales and market shares, to keep the company's resource portfolio in step with changes in the company's own strategy, and to build a more durable resource-based competitive edge over rivals.

d

Building an organization capable of good strategy execution entails: a. deciding which value chain activities to perform internally and which ones to outsource, implementing a cost-efficient organization structure, and do a good job of centralizing authority--as shown in Figure 10.3. b. effectively motivating company personnel to carry out their strategic roles proficiently, deciding which value chain activities to perform internally and which ones to outsource, and implementing a cost-efficient organization structure--as shown in Figure 10.2. c. staffing the organization, effectively training company personnel, developing a dynamic set of competencies and capabilities, and performing value chain activities cost-efficiently. d. investing heavily in employee training, deciding which value chain activities to perform internally and which ones to outsource, and building a powerful lineup of resource strengths and competitive capabilities--as shown in Figure 10.1. e. structuring the organization and work effort, staffing the organization, and acquiring, developing and strengthening the resources, competencies, and capabilities important to good strategy execution.

e

The process of creating and/or upgrading a strategy-critical competence or capability: a. entails empowering employees, putting them on a single team (or in a single department), and giving them the tools and training to perform each strategy-critical value chain activity with ever higher degrees of proficiency over time. b. is a one-step process built around properly training and empowering employees to perform strategy-critical value chain activities in a tightly-prescribed and very cost-efficient manner. c. is best done by putting a single department in charge of the building the needed competence or capability and staffing it with talented managers and employees, identifying outside companies that have world-class competence/capability in performing the activity, and then striving to imitate their practices and procedures as closely as possible. d. has to be focused squarely on hiring employees with the right kinds of expertise and intellectual capital, training these employees very intensively, organizing them into teams and work groups, and then gradually polishing and sharpening the ability of the teams/work groups to perform their tasks ever more proficiently and at progressively lower costs. e. is a three-stage process that requires first developing the ability to do something, however imperfectly or inefficiently; second, translating this ability into a competence and/or capability by learning to do the activity consistently well and at an acceptable cost; and then continuing to polish and sharpen performance of the activity in an effort to eventually become better than rivals at performing the activity.

e

The task of developing and strengthening a company's competencies and competitive capabilities: a. consists of hiring employees with the right kinds of expertise and intellectual capital, training these employees very intensively, organizing them into teams and work groups, and then gradually polishing and sharpening the ability of the teams/work groups to perform their assigned tasks consistently well and at a progressively lower cost. b. is nearly always best done internally via a 3-stage process that entails (1) first developing the ability to do something, however imperfectly or inefficiently; (2) translating this ability into a competence and/or capability by learning to do the activity consistently well and at an acceptable cost; and (3) then continuing to polish and sharpen performance of the activity in an effort to eventually become better than rivals at performing the activity. c. is best done by putting a single department in charge of the building the needed competence or capability and staffing it with talented managers and employees, identifying outside companies that have world-class competence/capability in performing the activity, and then striving to imitate their practices and procedures as closely as possible. d. is nearly always accomplished best and quickest by outsourcing a capability-deficient function to a key supplier or another provider that has the desired competence or capability. e. is sometimes best accomplished via acquisition or merger with a company having the desired competencies and capabilities or by forming collaborative partnerships with suppliers or other companies having the expertise or capabilities the company lacks internally.

e

Which of the following is not among the principal managerial components of the strategy execution process? a. Adopting best practices and pushing for continuous improvement in how value chain activities are performed b. Steering the needed resources to execution-critical value chain activities c. Using rewards and incentives to promote good strategy execution and the achievement of strategic and financial targets d. Exercising strong leadership to drive execution forward, keep improving on the details of execution, and move toward companywide operating excellence as rapidly as feasible e. Selecting which leadership style to employ and deciding whether to institute a centralized or decentralized organizational structure

e