MGT 455 Chapter 11

Which of the following exemplifies good strategy execution?

A. The policy document of Dominos ensures consistency in service behavior patterns across outlets

Which of the following statements about Six Sigma quality programs is true?

A. While Six Sigma programs often improve the efficiency of numerous operating processes, there is evidence that the approach can stifle innovative activities.

. The Six Sigma process of define, measure, analyze, improve, and control (DMAIC) is

A. an improvement system for existing processes falling below specification and needing incremental improvement.

A company's operating budget must

A. be strategy-driven in order to amply fund the performance of key value chain activities.

. A company's ability to marshal adequate resources in support of new strategic initiatives and steer them to the appropriate organizational units is important to the strategy execution process because

A. changes in strategy often require resource reallocation, and organizational units need the proper funding to carry out their part of the strategic plan effectively and efficiently.

Company strategies and value creating processes can't be effectively executed without internal information systems that include

A. customer data, employee data, supplier/partner data, operations data, and financial performance data.

The president of a specialty bakery decided to introduce nonmonetary incentives to enhance employee motivation and spur strategy execution. When her staff presented with some ideas, she chose all of the following EXCEPT

A. eliminating perks and fringe benefits, such as maternity leave and onsite child care

To build a total quality culture and achieve full value from the use of TQM or Six Sigma initiatives, managers can take such action steps as

A. encouraging quality-supportive behaviors on the part of employees, while empowering employees to make changes to improve quality

Total quality management (TQM)

A. entails creating a total quality culture that strives for continuously improving the performance of every value chain activity and is driven by a philosophy of managing a set of business practices: 100 percent accuracy in performing tasks (zero defects), involvement and empowerment of employees at all levels, team-based work design, benchmarking, and total customer satisfaction

Without a strategic framework, managers lack the context in which to

A. fix things that really matter to business-unit performance and competitive success

. A "best practice" standard

A. helps a company move toward performing its value chain activities more effectively and efficiently

Although it is relatively easy for rivals to implement process management tools, it is much more difficult and time-consuming for them to

A. instill a deeply ingrained culture of operating excellence

Business process reengineering

A. involves radically redesigning and streamlining the workflow (typically enabled by cutting-edge use of online technology and information systems), with the goal of achieving quantum gains in performance of the activity.

Reengineering how a firm performs a business process

A. is a tool for pulling the pieces of strategy-critical processes out of different departments and unifying their performance in a single department or cross-functional work group

The guidelines for designing an incentive compensation system that will help drive successful strategy execution include

A. making the payoff for meeting or beating performance targets a major, not minor, piece of the total compensation package

The guidelines for designing an incentive compensation system that will help drive successful strategy execution include

A. making the performance payoff a major, not minor, piece of the total compensation package.

An ambidextrous organization is one that

A. pursues incremental improvements in operating efficiency, while R&D and other processes that allow the company to develop new ways of offering value to customers are given freer rein

To create a strategy-supportive system of rewards and incentives, a company must

A. reward people for accomplishing results, not just for dutifully performing assigned tasks

A motivation and incentive system that is aimed at spurring stronger employee commitment to good strategy execution

A. should focus on incorporating more positive than negative motivational elements

To obtain maximum benefits from benchmarking, best practices, reengineering, TQM, and Six Sigma programs aimed at facilitating better strategy execution, managers need to

A. start with a clear idea of what specific outcomes really matter, such as a Six Sigma defect rate or superior customer satisfaction, and then build a total quality culture that is genuinely committed to achieving these outcomes

Which of the following is NOT likely to be effective in trying to gain employees' wholehearted commitment to good strategy execution?

A. strictly enforcing all rules in the employee handbook with the use of fines

no-pressure/no-adverse-consequences work environment does not necessarily lead to

A. superior strategy execution or operating excellence.

. A well-designed reward system

A. ties rewards to performance outcomes directly linked to good strategy execution and the achievement of financial and strategic objectives.

A useful guideline in designing strategy-facilitating policies and operating procedures is

A. to prescribe enough policies to give organizational members clear direction in implementing strategy and to place desirable boundaries on their actions, then empower them to act within these boundaries however they think makes sense

useful guideline in designing strategy-facilitating policies and operating procedures is

A. to prescribe enough policies to give organizational members clear direction in implementing strategy and to place reasonable boundaries on their actions. This then empowers them to act within these boundaries in pursuit of company goals

Six Sigma programs

A. utilize advanced statistical methods to improve quality by reducing defects and variability in the performance of business processes

statistical thinking underlying Six Sigma is based on which of the following three principles?

B. All work is a process, all processes have variability, and all processes create data that explains variability.

A company wants to plan a state-of-the-art information and operating system to enable better strategy execution. Which of the following is the most likely reason for the company's move?

B. It wants to gain a competitive edge over rivals

The top management at a new social media technology company would like to revamp its incentive compensation system to attract ambitious employees. What would be their best approach?

B. Make the performance bonus at least 10 to 12 percent of base salary to have some impact

Which of the following makes use of Six Sigma programs to improve quality and strategy execution?

B. Milwaukee Hospital improves the accuracy of administering the proper drug doses to patients.

Which of the following statements about total quality management (TQM) is FALSE?

B. TQM produces significant results very quickly, with very little benefit emerging after the first six months.

Six Sigma processes

B. can be used for both improving existing business processes and for developing new processes or products.

The broad areas that internal information business systems need to cover include all of the following EXCEPT

B. corporate culture data.

Motivational and incentive compensation practices that aim at winning the commitment of company personnel to good strategy execution typically

B. entail decidedly positive rewards for meeting or beating performance targets, but also impose sufficiently negative consequences when actual performance falls short of the target.

A company that successfully and methodically applies Six Sigma methods to its value chain, activity by activity, can

B. make major strides in improving the proficiency with which its strategy is executed without sacrificing innovation.

. A "best practice" refers to a

B. method of performing an activity or business process that consistently delivers superior results compared to other approaches and that at least one company has demonstrated works particularly well in terms of delivering operating excellence

Well-conceived, state-of-the-art information and operating systems

B. not only enable better strategy execution but also strengthen organizational capabilities (perhaps enough to provide a competitive edge over rivals)

. Management's most powerful tool for mobilizing organizational commitment to competent strategy execution and operating excellence is the

B. proper use of a reward structure with motivational incentives

. Business process reengineering is a tool for

B. radically redesigning and streamlining how an activity (workflow) is performed, by pulling the pieces of strategy-critical activities out of different departments and unifying their performance in a single department or cross-functional work group

. Managers charged with implementing and executing strategy need to be deeply involved in the budgeting and resource allocation process because of all the following reasons EXCEPT

B. resource allocation involves screening of requests for people, facilities and equipment, and approving them, whether they contribute to the strategy execution effort or not.

Visible actions to reallocate operating funds and move people into different and new organizational units

B. signal a determined commitment to strategic change and can help catalyze and give credibility to the implementation process.

There is evidence that Six Sigma can

B. stifle innovation and creativity in organizations

. Apple decides to reallocate resources by curtailing online ad budgets and investing heavily in scratch-resistant Sapphire, the material that differentiates the Apple Watch from rival wearable computing device brands. What is MOST LIKELY the reason for Apple's reallocation of resources?

B. supporting the new strategic initiative of the brand

. Cavco Construction divests funds from its commercial property ventures to invest in gated community properties close to New York, signaling a change of strategy. Which of the following statements about Cavco is most likely true?

C. Cavco is marshalling resources to support new strategic initiative

From the standpoint of promoting successful strategy execution, it is important that the firm's motivation and reward system

C. accentuate positive rewards but also carry out the "up-or-out" policy for performance that does not meet expectations

Total quality management (TQM) emphasizes all of the following EXCEPT which?

C. adoption of industry standard operating practices

. From a strategy-implementing/strategy-executing perspective, operating budget allocations should

C. be strategy-driven and based on how much each organizational unit needs to carry out its piece of the strategic plan efficiently and effectively.

The backbone of the process of identifying, studying, and implementing best practices is

C. benchmarking

. New strategies often entail budget reallocations because

C. business units important in the prior strategy but having a lesser role in the new strategy may need downsizing, while units and activities that now have a bigger and more critical strategic role may need more people, new equipment, additional facilities, and above-average increases in their operating budgets.

Six Sigma quality control

C. consists of a disciplined, statistics-based system aimed at producing not more than 3.4 defects per million iterations for any business process

Six Sigma quality control

C. consists of a disciplined, statistics-based system aimed at producing not more than 3.4 defects per million iterations for any business process.

The strategic role of a company's reward system is to

C. enlist employees' commitment to successful strategy execution by rewarding them, both monetarily and non-monetarily, for their valuable contributions

Total quality management (TQM) programs

C. entail creating a corporate culture bent on continuously improving the performance of every task and every value chain activity

The first principle in designing an effective compensation system and the most dependable way to keep people focused on strategy execution and the achievement of performance targets is to

C. generously reward and recognize people who meet or beat performance targets and to deny rewards and recognition to those who don't.

The more a manager understands what motivates subordinates and the more he or she relies on motivational incentives as a tool for achieving the targeted strategic and financial results the

C. greater the employees' commitment to day-by-day strategy execution and achievement of performance targets.

Reward and incentive systems serve as a(n)

C. indirect type of control mechanism that conserves on more costly control mechanisms of supervisory oversight.

A change in strategy nearly always entails budget reallocations because

C. organizational units important in the prior strategy but having a lesser role in the new strategy may need downsizing, while units and activities that now have a bigger and more critical strategic role may need more people, new equipment, additional facilities, and above-average increases in their operating budgets.

The big difference between business process reengineering and continuous improvement programs like TQM or Six Sigma is that

C. reengineering is a tool for achieving one-time quantum improvement, whereas TQM and Six Sigma programs aim at ongoing incremental improvements.

. Enlisting employees' sustained and energetic commitment to good strategy execution and achievement of the strategic priorities and financial objectives is best done by

C. resourceful and effective use of motivational incentives, both monetary and nonmonetary

. Which of the following is NOT a tool or method that managers can use to promote operating excellence and further the cause of good strategy execution?

C. strategic resource training

Because functional organization structures often result in pieces of strategically relevant activities and capabilities being scattered across many different functional departments, companies have found that

C. there is merit in using business process reengineering to radically redesign and streamline strategy-critical processes and workflow from different departments and unifying their performance into a single department or cross-functional work group that has charge over the whole process

. Merely fine-tuning the execution of a company's existing strategy normally requires

C. trimming costs and shifting resources to activities that have a higher priority

Which of the following takes the route of business process reengineering to attain operational excellence?

D. Cellkon pulls the pieces of an activity out of different departments to create a cross-functional work group.

Which of the following exemplifies one of the most widely used methods of gauging how well a company is executing its strategy?

D. Fizz-Cola judges the efficiency of internal operations by benchmarking them against best-in-industry performers.

Which of the following does NOT exemplify business process reengineering?

D. PayPal segregates payment notification operations from mobile transfer operations to expand its customer base.

Which of the following is NOT a sound guideline for designing a reward and incentive system that helps promote good strategy execution?

D. The reward system must reward nonperformers who, despite expending tremendous effort, have not fared well in achieving the benchmarks under the incentive system

. Which of the following is NOT a sound guideline for designing a reward and incentive system that helps promote good strategy execution?

D. Ways must be found to reward deserving nonperformers who, for some reason, do not fare well under the incentive system

Management's most powerful tool for winning employee commitment to good strategy execution is

D. a structure of rewards and incentives tied tightly to the achievement of the organization's strategic priorities.

. Providing top-down guidance can aid the task of implementing strategy

D. by helping align the actions and behavior of company personnel with the requirements for good strategy execution, placing limits on independent action, and helping overcome resistance to change

Six Sigma's DMADV process of define, measure, analyze, design, and verify is a particularly good vehicle for

D. developing new processes or products at Six Sigma quality levels

Information systems provide managers with a means for monitoring all of the following EXCEPT

D. employees with over-the-shoulder supervision.

Well-conceived policies and operating procedures facilitate good strategy execution by

D. enforcing consistency in how strategy-critical activities are performed

. eBay, an online auction business, streamlines its retail business by listing PayPal, a digital payments company, as a separately traded company. eBay's move is likely to

D. enhance eBay's strategy execution capabilities

. Which of the following is NOT a benefit of prescribing policies and operating procedures to aid management's task of implementing strategy?

D. helping build employee commitment to adopting best practices and using the tools of TQM and Six Sigma

The idea behind benchmarking and best practices is to

D. identify companies that are the best performers of an activity and then "adapt" their practices to fit the company's own specific circumstances and operating requirements

Company managers can significantly advance the cause of superior strategy execution by doing all of the following EXCEPT

D. instituting operating practices that generate economies of scale and scope with current value chain activities

Leaving employees to their own devices in meeting performance standards

D. is NOT a recommended way for managers to monitor the operating performance of employees to ensure superior strategy execution

Which of the following is NOT a method that company managers can use to promote operating excellence in performing value chain activities?

E. Adopt standard industry techniques

. Which of the following does NOT facilitate strategy execution?

E. Renault is averse to standardization of the way activities are performed at its service centers

Which of the following is NOT characteristic of a compensation and reward system designed to help drive successful strategy execution?

E. a reward system that involves 50 percent nonmonetary rewards and a work environment that avoids placing pressure on managers and employees to perform at high levels

The broad areas that internal information business systems need to cover include all of the following EXCEPT

E. competitor data.

Essential state-of-the-art operating and information systems that support company strategies and value-creating internal processes include all of the following EXCEPT

E. data management systems for undertaking benchmarking, TQM, and Six Sigma quality control.

A reward system that accentuates positive rewards for good performance

E. has considerable appeal because when cooperation is positively enlisted and rewarded, rather than strong-armed by orders and threats (implicit or explicit), people tend to respond with more enthusiasm, dedication, creativity, and initiative.

Which of the following is NOT integral to superior strategy execution and operating excellence?

E. having access to employee data of competitors

An important consideration in designing a strategy-supportive motivation and reward system is to

E. make both monetary and nonmonetary rewards integral parts of the reward system

An important consideration in designing a strategy-supportive reward system is to

E. make nonmonetary rewards and recognition an integral part of the reward system.

Which of the following is NOT characteristic of a compensation and reward system designed to help drive successful strategy execution?

E. offering rewards that amount to 3 percent of an employee's total compensation

Prescribing policies and operating procedures aids the task of implementing strategy by

E. placing limits on ineffective independent action and channeling efforts of individuals along a path more conducive to good strategy execution and operating excellence

In prescribing policies and procedures that facilitate independent action on the part of empowered employees for good strategy execution companies need to do ALL of the following EXCEPT

E. produce policy manuals on strategy execution that prescribe exactly how daily operations are to be conducted.

. In trying to gain employees' wholehearted commitment to good strategy execution and operating excellence, managers are well advised to use all of the following incentives EXCEPT

E. withholding information from employees about financial performance, strategy, and competitors' actions.