Question 1

Effective short-term objectives should be ______________ and _____________.

Accepted Answer

A)   specific; measurable
B)   achievable; not challenging
C)   motivating; not limiting
D)   time defined; not limitingE) A) and B)
F) None of the above

Question 2

Tesco was forced to restate its earnings for the first half of 2014 to 431 million USD because senior managers in the UK food business had booked income early and delayed the booking of costs in order to improve appearances of financial performance.This scandal results from ____________ and __________.

Accepted Answer

A)   poor environment; management systems
B)   poor governance; control
C)   external environmental factors; internal environmental factors
D)   leadership; financial systemsE) C) and D)
F) A) and B)

Question 3

Auditors are appointed by the Securities and Exchange Commission to audit company financial statements.

Accepted Answer

A) True 
 B)False  False

Question 4

Contemporary approaches to strategic control rely primarily on

Accepted Answer

A)   feedback controls.
B)   single-loop learning.
C)   double-loop learning.
D)   comparative learning.E) All of the above
F) A) and B)

Question 5

One of the most critical roles of the board of directors is to create incentives that align the interests of the CEO and top executives with the interests of shareholders.

Accepted Answer

A) True 
 B)False

Question 6

All of the following are types of information that a firm is required to disclose except

Accepted Answer

A)   quarterly and annual filings of financial information.
B)   stock trading by insiders.
C)   details of new products under development.
D)   details of executive compensation packages.E) A) and B)
F) C) and D)

Question 7

For the maximum benefit of each part,a corporation is a mechanism created to allow different parties to contribute all of the following except

Accepted Answer

A)   buildings.
B)   capital.
C)   expertise.
D)   labor.E) A) and C)
F) A) and D)

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

Shareholders rely on CEOs to adopt policies and strategies that maximize the value of their shares.To motivate CEOs to maximize the value of their companies,boards of directors can consider all of the following options except one.Which one is it?

Accepted Answer

A)   Boards can require that the CEOs become substantial owners of company stock.
B)   Salaries, bonuses, and stock options can be structures to provide rewards for superior performance.
C)   Salaries can be structured to provide penalties for poor performance.
D)   Dismissal for poor performance is not an option.E) All of the above
F) B) and C)

Question 10

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

Accepted Answer

A) True 
 B)False  True

Question 11

Most organizations with strong cultures and a sound system of rewards and incentives can eventually internalize boundaries rather than use explicit rules and regulations.Which of the following is not a technique for moving in that direction?

Accepted Answer

A)   Hire people who identify with the dominant values of the organization.
B)   Develop managerial role models.
C)   Minimize training and indoctrination.
D)   Align reward systems with organizational goals and objectives.E) A) and C)
F) A) and D)

Question 12

In order to minimize the temptation for managers to act in their own self-interest,governance mechanisms exist for implementation consideration.Which of the following is not a primary means for monitoring managerial behavior?

Accepted Answer

A)   a board of directors that acts in the best interests of shareholders to create short-term value
B)   shareholder activism in which owners view themselves a shareowners
C)   a board of directors that acts in the best interests of shareholders to create long-term value
D)   managerial incentives to align management interests with those of the stockholdersE) A) and C)
F) B) and C)

Question 13

In choosing membership on the board of directors,consideration should be given to the size of the board as well as the individual member expertise and commitment to participate fully.

Accepted Answer

A) True 
 B)False

Question 14

As firms simultaneously downsize and face the need for increased coordination across organizational boundaries,a control system based primarily on ______________ is dysfunctional.

Accepted Answer

A)   boundaries and constraints
B)   culture and rewards
C)   organizational loyalty
D)   innovation and risk takingE) A) and B)
F) All of the above

Question 15

The traditional approach to strategic control is sequential.Which of the following is not one of the steps in the sequence?

Accepted Answer

A)   Action plans are submitted by lower level managers.
B)   Performance is measured against the predetermined goal.
C)   Strategies are implemented.
D)   Strategies are formulated and top management sets goals.E) A) and D)
F) B) and C)

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

The late Sam Walton,founder of Walmart,used to give pep rallies at local Walmart stores.What purpose did this serve?

Accepted Answer

A)   It was used to remind employees of Walmart rules and regulations.
B)   It helped reinforce and sustain the Walmart culture.
C)   It demonstrated to employees the importance of articulating explicit goals and objectives.
D)   It made the Walmart reward system very explicit.E) All of the above
F) A) and B)

Question 18

When firms like Siebel Systems,Disney,Oracle,and Microsoft separated the roles of CEO and chairman of the board,they were creating CEO duality.

Accepted Answer

A) True 
 B)False

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

Rules and regulations,rather than culture or rewards,would be used for strategic control at which type of company?

Accepted Answer

A)   software developer
B)   stock brokerage firm
C)   manufacturer of mass produced products
D)   high tech research facilityE) C) and D)
F) None of the above C

Exam 9: Strategic Control and Corporate Governance

Effective short-term objectives should be ______________ and _____________.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Auditors are appointed by the Securities and Exchange Commission to audit company financial statements.

Correct AnswerverifiedFalse

Contemporary approaches to strategic control rely primarily on

Correct AnswerverifiedShow Answer

One of the most critical roles of the board of directors is to create incentives that align the interests of the CEO and top executives with the interests of shareholders.

Correct AnswerverifiedShow Answer

All of the following are types of information that a firm is required to disclose except

Correct AnswerverifiedShow Answer

For the maximum benefit of each part,a corporation is a mechanism created to allow different parties to contribute all of the following except

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Shareholders rely on CEOs to adopt policies and strategies that maximize the value of their shares.To motivate CEOs to maximize the value of their companies,boards of directors can consider all of the following options except one.Which one is it?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedTrue

Most organizations with strong cultures and a sound system of rewards and incentives can eventually internalize boundaries rather than use explicit rules and regulations.Which of the following is not a technique for moving in that direction?

Correct AnswerverifiedShow Answer

In order to minimize the temptation for managers to act in their own self-interest,governance mechanisms exist for implementation consideration.Which of the following is not a primary means for monitoring managerial behavior?

Correct AnswerverifiedShow Answer

In choosing membership on the board of directors,consideration should be given to the size of the board as well as the individual member expertise and commitment to participate fully.

Correct AnswerverifiedShow Answer

As firms simultaneously downsize and face the need for increased coordination across organizational boundaries,a control system based primarily on ______________ is dysfunctional.

Correct AnswerverifiedShow Answer

The traditional approach to strategic control is sequential.Which of the following is not one of the steps in the sequence?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

The late Sam Walton,founder of Walmart,used to give pep rallies at local Walmart stores.What purpose did this serve?

Correct AnswerverifiedShow Answer

When firms like Siebel Systems,Disney,Oracle,and Microsoft separated the roles of CEO and chairman of the board,they were creating CEO duality.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Rules and regulations,rather than culture or rewards,would be used for strategic control at which type of company?

Correct AnswerverifiedC

Effective short-term objectives should be __ and _.

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False

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True

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C