Allocating resources can be a political and an ad hoc

activity in firms that do not use strategic management. Why

is this true? Does adopting strategic management ensure
easy resource allocation? Why?
Answer: Allocating resources can be ad hoc and political in
the absence of strategic management Because no good
substitute approach for making major decisions exists.
Intuition, subjectivity, and emotions are not adequate for
making resource allocation decisions that have strategic
ramification for an entire organization. Strategic
management does not assure easy resource allocation, but it
generally results in more effective resource allocation.
2. Compare strategy formulation with strategy
implementation in terms of each being an art
or a science.
Answer: The strategy-formulation process is more of a
science, whereas strategy implementation is more of an art.
Strategy implementation involves motivating employees.
However, neither strategy formulation nor strategy
implementation is a pure science or art because, for
example, intuition and good subjective judgment are always
essential in strategy formulation.
3. Describe the relationship between annual objectives and
policies.
Answer: Interrelationships among organizational
objectives, strategies, and policies are revealed
in the strategic-management model. Note that long-term
objectives and strategies are part of the strategy-formulation
process, whereas annual objectives and policies are part of
strategy implementation. Clear policies facilitate attainment
of annual objectives.
4. Identify a long-term objective and two supporting annual
objectives for a familiar organization.
Answer: Answers to this question vary for each student. An
example might be for a business
school: Schools withoutAACSB accreditation might seek it
as a long-term objective with increased scholarly output and
increased outcome measures (job placement or field test
scores) as supporting annual objectives.
6. Explain the following statement: Horizontal consistency
of goals is as important as vertical consistency.
Answer: This is a true statement. Horizontal consistency of
objectives is as important as vertical consistency.An
example of horizontal consistency could be that ³there is no
need for the marketing department to plan on doubling sales
if the production department cannot produce the additional
units.´
7. Describe several reasons why conflict may occur during
objective-setting activities.
Answer: The objective-setting process can lead to conflict
due to competition over scarce resources, different
expectations among individuals, different perceptions
 among individuals, miscommunication, time pressure,
personality incompatibility, and line and staff
misunderstandings.
8. In your opinion, what approaches to conflict resolution
would be best for resolving a disagreement between a
personnel manager and a sales manager over the firing of a
particular salesperson? Why?
Answer: Various approaches for minimizing and resolving
conflict can be classified in three ways:
avoidance, defusion, and confrontation. Depending on the
situation, any of these three alternative approaches could
justifiably be most effective in solving a dispute between a
personnel manager and sales manager.
9. Describe the organizational culture of your college or
university.
Answer: Answers to this question will vary by college or
university. Every institution has different rituals, values,
stories, legends, heroes, ceremonies, and the like.
10. Explain why organizational structure is so important in
strategy implementation.
Answer: Organizational structure is important in strategy
implementation because a firms design dictates how
resources will be allocated and how objectives will be
established. In a geographically structured organization, for
example, objectives are stated in geographic terms and
resources are allocated by region.
11. In your opinion, how many separate divisions could an
organization reasonably have without using an SBU-type
organizational structure? Why?
Answer: The answer to this question depends on the size
and type of divisions, but, generally speaking, a firm that
hat has six or more divisions could benefit from an SBU-
type of organizational structure
12. Would you recommend a divisional structure by
geographic area, product, customer, or process for a
medium-sized bank in your local area? Why?
Answer: A divisional structure by geographic area is
appropriate for organizations whose Strategies need to fit
the particular needs and characteristics of customers in
different geographic areas. A divisional structure by
product type design is effective when special emphasis
needs to be placed on specific products or services, when an
organization offers only a limited number of products or
services, when the nature of an organization product differs
substantially, or when different marketing approaches are
required for the organization various products. When a few
major customers are of paramount importance and many
different services are provided to these customers, then a
divisional structure by customer can be most effective. A
divisional structure by process can be particularly effective
when distinct production processes represent the thrust of
 competitiveness in an industry. A divisional structure by
geographic area is most commonly used by medium-sized
banks.
13. What are the advantages and disadvantages of
decentralizing the wage and salary function of an
organization? How could this be accomplished?
Answer: Decentralizing the wage and salary function of an
organization could allow a firmsreward system to be more
closely linked to strategic performance. It also could allow
decisions on salary increases, promotions, merit pay, and
bonuses to be more closely aligned to support the long-term
strategic objectives of an organization. .
15. As production manager of a local newspaper, what
problems would you anticipate in implementing a strategy to
increase the average number of pages in the paper by 40
percent?
Answer: Problems that could be encountered include the
need to obtain additional advertising to cover the cost of
additional pages, as well as needing additional employees.
A problem could arise in deciding whether to raise the price
of the paper. There may need to be an increase in the
market area coverage of the paper.
16. Do you believe expenditures for childcare or fitness
facilities are warranted from a Cost/benefit perspective?
Why or why not?
Answer: Reports suggest that yes, these expenditures are
warranted. Managers and employees become more
committed to the firm when child care and fitness facilities
are provided, or at least when some resources are allocated
to these areas.
17. Explain why successful strategy implementation often
hinges on whether the strategy- formulation process
empowers managers and employees

Answer: Managers and employees make or break a firm.

More and more, firms are empowering managers and
employees through involvement in the strategic-
management process. Lack of
involvement or ³empowering´ often results in a lack of
commitment to see the firm do well.
18. Compare and contrast the culture in Mexico, and Japan.
Answer: Mexican and Japanese cultures are very different.
Mexico always has been and still is an authoritarian society
in terms of schools, churches, businesses, and families.
Employers seek workers who are agreeable, respectful, and
obedient, rather than innovative, creative, and independent.
Mexican workers tend to be activity oriented rather than
problem solvers. Mexican employers are paternalistic,
providing workers with more than a paycheck, but in return,
they expect allegiance. The Japanese place great importance
on group loyalty and consensus, a concept calledwa. Nearly
all corporate activities in Japan encourage wa among
managers and employees. Wa requires that all members of
a group agree and cooperate; this results in constant
discussion and compromise. Most Japanese managers are
reserved, quiet, distant, introspective, and other oriented,
whereas most U.S. managers are talkative, insensitive,
impulsive, direct, and individual oriented.
19. Discuss the glass ceiling in the United States, giving
your ideas and suggestions.
Answer: The glass ceiling refers to the set of obstacles
(which are primarily cultural) that prevent women from
rising above a certain hierarchical level in the majority of
organizations. Ask your students to comment on the causes
for the glass ceiling and how the glass ceiling can be
removed in the United States.
20. Discuss three ways the book discusses linking
performance and pay to strategies.
Answer: Some methods of linking performance to pay
include profit sharing, gain sharing, and bonus systems.
Profit sharing is widely used but can be a less than desirable
criterion since individuals may not be clearly able to affect
profits. Gain sharing requires employees or departments to
establish performance targets. If actual results exceed
objectives, all members get bonuses. In a bonus system, if
an organization meets certain agreed-upon objectives, every
member of the enterprise shares in the benefits. Criteria for
bonus systems include sales, profit, production efficiency,
quality and safety.