56) What is spurious to superior strategy execution and operating excellence?
A) having real-time information systems that permit company managers to stay on top of
implementation initiatives and daily operations and to intervene if things seem to be drifting off
course
B) having state-of-the-art operating systems, information systems, and real-time data
C) having access to online systems that provide statistical information about operating activities
D) having the systems capability to identify and diagnose problems, so as to take corrective
actions
E) having access to employee data of competitors
57) Leaving employees to their own devices in meeting performance standards
A) enables managers to monitor daily and weekly operating statistics without resorting to
constant over-the-shoulder supervision.
B) optimizes the performance of self-managed work groups in peer-based control environments.
C) is preferable to relying on peer pressure to keep team members operating between the white
lines.
D) is NOT a recommended way for managers to monitor the operating performance of
employees to ensure superior strategy execution.
E) is the best use of information systems capabilities in the strategy execution effort.
58) Sandi has been hired as a consultant to develop a state-of-the-art information and operating
system for a local winery to enable better strategy execution. How have Mike and Chris, owners
of the winery, justified retaining Sandi and adopting the new IT system?
A) They want to embrace modern technology in the winery.
B) They want to gain a competitive edge over wine industry rivals.
C) They are seeking more efficient methods to spot cost overruns and inefficiencies.
D) They desire to increase workforce productivity and retention.
E) Their aim is to boost management morale.
59) Management’s most powerful tool for mobilizing organizational commitment to competent
strategy execution and operating excellence is the
A) diligent and persistent use of benchmarking and best practices.
B) proper use of a reward structure with motivational incentives.
C) implementation of TQM and/or Six Sigma programs.
D) periodic giving of inspirational speeches aimed at arousing employees’ emotional energy.
E) process of providing employees with a high degree of job security (ideally, via a no-layoff
policy).
60) Management’s most powerful tool for winning employee commitment to good strategy
execution is
A) the establishment of strategy-supportive policies and procedures.
B) empowering employees and encouraging them to adopt best practices.
C) setting stretch objectives.
D) a structure of rewards and incentives tied tightly to the achievement of the organization’s
strategic priorities.
E) aggressive use of TQM and Six Sigma quality control programs.
61) The strategic role of a company’s reward system is to
A) compensate employees for performing their assigned duties in a diligent fashion.
B) boost employee morale in ways that create widespread job satisfaction.
C) enlist employees’ commitment to successful strategy execution by rewarding them, both
monetarily and non-monetarily, for their valuable contributions.
D) relieve managers of the burden of closely monitoring each employee’s performance.
E) boost labor productivity and help lower the firm’s overall labor costs.
62) Reward and incentive systems serve as a(n)
A) direct stimulus for satisfying the basic expectations of the standard job and mechanisms.
B) indirect motivational tool designed to convert employee commitment into high-powered
incentives.
C) indirect type of control mechanism that conserves on more costly control mechanisms of
supervisory oversight.
D) direct base-pay financial compensation mechanism that competes with rival companies’ salary
bands for similar work efforts.
E) negative motivational element.
63) Enlisting employees’ sustained and energetic commitment to good strategy execution and
achievement of the strategic priorities and financial objectives is best done by
A) having top executives commit to making employees the company’s most valuable competitive
asset.
B) developing core competencies in the use of TQM, Six Sigma programs, and business process
reengineering.
C) resourceful and effective use of motivational incentives, both monetary and nonmonetary.
D) clever and innovative use of benchmarking and best practices.
E) providing employees with a high degree of job security and attractive perks.
64) What is NOT a recommended incentive when trying to gain employees’ wholehearted
commitment to good strategy execution and operating excellence?
A) providing attractive perks and fringe benefits.
B) giving awards and public recognition to high performers and showcasing company successes.
C) creating a work atmosphere in which there is genuine caring and mutual respect among
workers and between management and employees.
D) relying on opportunities for promoting from within wherever possible.
E) withholding information from employees about financial performance, strategy, and
competitors’ actions.
65) What is UNLIKELY 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
B) giving awards and public recognition to high performers and showcasing company successes
C) providing a comfortable and attractive working environment
D) providing opportunities for promotion from within wherever possible
E) providing attractive perks and fringe benefits
66) 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.
B) should be tied first and foremost to whether employees satisfactorily perform their assigned
duties in an ethical and honorable manner.
C) must involve deliberately assigning employees heavy workloads and tight deadlines.
D) needs to put top priority on making employees happy and secure in their jobs.
E) must avoid the potential for negative consequences if performance is subpar.
67) From the standpoint of promoting successful strategy execution, it is important that the firm’s
motivation and reward system
A) be completely free of such elements as tension, pressure, anxiety, job insecurity, and tight
deadlines—a no-pressure/no-adverse-consequences work environment is essential.
B) emphasize only positive types of rewards.
C) accentuate positive rewards but also carry out the “up-or-out” policy for performance that
does not meet expectations.
D) not deny rewards to employees who put forth good effort and try hard, though performance is
subpar.
E) reduce job insecurity and give employees an incentive to stay busy and work hard.
68) A reward system that accentuates positive rewards for good performance
A) works best in strong culture organizations, while negative motivational approaches and
reward systems tend to be most successful in weak culture organizations.
B) is especially effective in aligning the well-being of organizational members with achieving
the company’s performance targets; reward systems with negative elements tend to be very
dysfunctional in motivating employees.
C) seldom works very well because the threat of denying rewards to sub-par performers is
typically the most powerful motivator.
D) works fine so long as 100 percent emphasis is placed on monetary incentives.
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.
69) A no-pressure/no-adverse-consequences work environment does not necessarily lead to
A) superior strategy execution or operating excellence.
B) satisfactory outcomes because there is always a cadre of ambitious people who relish the
challenge.
C) workforce morale issues.
D) establishing more positive than negative motivational reward elements.
E) excessive shortfall in performance.
70) 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.
B) focus jobholders’ attention and energy on what to do as opposed to what to achieve.
C) demand jobholders’ 100 percent attendance since it guarantees results.
D) hold jobholders responsible for their function and not burden them with being accountable.
E) incorporate negative motivational elements to assure results.
71) Motivational and incentive compensation practices that aim at winning the commitment of
company personnel to good strategy execution typically
A) use only positive rewards and never involve the use of tension, fear, job insecurity, stress, or
anxiety.
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.
C) aim at creating a no-pressure/no-adverse-consequences work environment.
D) entail paying the highest wages and salaries in the industry for all jobholder positions and also
stressing nonmonetary rewards, like cash bonuses for high-performing employees.
E) put top priority on making employees happy and secure in their jobs.
72) Shelina, who runs a motorbike riding camp for girls, is considering the creation of an
effective compensation system for her staff. What should Shelina do first?
A) establish ethical compensation policies and convince employees that they are the firm’s most
valuable competitive asset.
B) design monetary and nonmonetary incentives that boost labor productivity and help lower the
firm’s overall labor costs.
C) generously reward and recognize people who meet or beat performance targets and deny
rewards and recognition to those who don’t.
D) pay employees a bonus for each strategic and financial objective that the company achieves.
E) allow employees to propose what rewards they would like to receive to achieve the company’s
stretch objectives.
73) 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.
B) should be free of elements that induce stress, anxiety, tension, pressure to perform, and job
insecurity.
C) puts the primary emphasis on denying rewards to those who fail to perform tasks in the
prescribed fashion.
D) emphasizes weeding out employees who are average performers.
E) strives for a 50-50 balance between positive and negative rewards and a 50-50 balance
between monetary and nonmonetary rewards.
74) An important consideration in designing a strategy-supportive reward system is to
A) link the payment of all monetary rewards to the company’s bottom-line profitability.
B) employ incentives that will help motivate employees to put in long hours and sacrifice
personal ambitions and aspirations to pursue the priorities of management.
C) choose those types of rewards and incentives that will focus employees’ attention on total
customer satisfaction.
D) make across-the-board wage and salary increases the cornerstone of monetary rewards.
E) make nonmonetary rewards and recognition an integral part of the reward system.
75) 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.
B) having incentives that apply to the management team (employees should generally not be
included in incentive pay plans but should have attractive wages and salaries).
C) having an outside wage and salary expert administer the system so there is no doubt as to its
fairness and impartiality.
D) basing the incentives on group performance rather than individual performance.
E) making minimal use of nonmonetary incentives and rewarding people for diligently
performing their assigned duties.
76) Designing a reward and incentive system that helps promote good strategy execution would
NOT be characterized by
A) being administered with scrupulous objectivity and fairness.
B) minor payoffs as a piece of the total compensation package.
C) extending the program to all managers and all employees, not just top management.
D) rewarding nonperformers who, despite expending tremendous effort, have not fared well in
achieving the benchmarks under the incentive system.
E) ensuring that the performance targets each individual or team is expected to achieve involve
outcomes that the individual or team can personally affect.
77) A compensation and reward system designed to help drive successful strategy execution does
NOT normally encompass
A) tying incentives to performance outcomes directly linked to good strategy execution and
financial performance
B) keeping the time between achieving the target performance outcome and the payment of the
reward as short as possible
C) making sure that the performance targets that each individual or team is expected to achieve
involve outcomes that the individual or team can personally affect
D) providing generous rewards for people who turn in outstanding performances
E) offering rewards that amount to 3 percent of an employee’s total compensation
78) 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
A) higher the incentives for employees to act ethically.
B) greater the opportunity for the company to attune its value chains to the level of industry
(buyer) demand.
C) greater the employees’ commitment to day-by-day strategy execution and achievement of
performance targets.
D) fewer the number of rivals will be attracted to enter the industry.
E) greater the company’s relative competitive strength in its industry.
79) Angela, owner of Sift Cupcakes, a specialty baking company, has decided to consult with her
staff before introducing nonmonetary incentives to enhance employee motivation. When she
asked her staff for with some ideas, she decided to implement all of the following EXCEPT
A) eliminating perks and fringe benefits, such as maternity leave and onsite child care.
B) giving awards and public recognition to high performers and showcasing company successes.
C) sharing information with staff about the company’s strategic plan and its operating and
financial performance.
D) providing opportunities for employees to quickly move up the ranks to join the management
level.
E) creating a work atmosphere where there was genuine caring and mutual respect among staff
and between management and staff.
80) 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?
A) Make the performance bonus at least 3 to 4 percent of base salary to have some impact.
B) Make the performance bonus at least 10 to 12 percent of base salary to have some impact.
C) Make the performance payoff equal for average and below-average performers.
D) Set unrealistic performance standards, but with an equally high compensation.
E) Reward people who work very hard, even if they fall short of achieving performance targets.
81) A change in strategy nearly always entails budget reallocations because
A) revamping the performance of value chain activities can be costly.
B) the accompanying policy revisions and compensation incentives tend to require different
levels of funding than before.
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.
D) empowering employees to carry out the new strategy elements typically requires substantial
new funding and budget revisions.
E) adopting best practices and pushing for continuous improvement tends to reduce costs and
reduce overall resource requirements.
82) 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.
B) that strictly enforced policies work better than loosely enforced policies.
C) that more policies/procedures work better than few policies/procedures and that strict
enforcement always beats lax enforcement.
D) to let individuals act in an empowered and self-directed way, subject only to the constraint
that their actions and behavior be ethical and in step with the corporate culture.
E) to prescribe enough policies and procedures that little is left to chance in performing value
chain activities; employees should have no leeway to do things in a manner that deviates from
the company’s best practices standard.
83) 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.
B) is the most frequently used tool of total quality management (TQM).
C) requires that a company have many strategic partnerships and alliances with outsiders.
D) is typically cheaper and easier-to-do than using Six Sigma techniques to achieve the same
cost savings.
E) is usually a company’s most important “best practice” for achieving operating excellence.