Question 1

The business media is a significant external control mechanism.

Accepted Answer

A) True 
 B)False

Question 2

Agency theory is concerned with the problem that arises when the goals of the agents conflict with those of the surrounding community members.

Accepted Answer

A) True 
 B)False

Question 3

Public companies are required by law to disclose information regarding executive compensation packages.

Accepted Answer

A) True 
 B)False

Question 4

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) None of the above
F) All of the above

Question 5

Strategic control systems, both informational and behavioral, are used to correct the performance and ultimate strategy of a firm.

Accepted Answer

A) True 
 B)False

Question 6

The primary participants in corporate governance do not include the

Accepted Answer

A)  shareholders.
B)  financial institutions.
C)  management (led by the chief executive officer) .
D)  board of directors.E) A) and D)
F) A) and B)

Question 7

Rewards systems that reinforce the core values of the organization and contribute to organizational cohesiveness are the least effective type.

Accepted Answer

A) True 
 B)False

Question 8

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) C) and D)
F) A) and B)

Question 9

Double-loop learning in the contemporary approach to strategic control means that the organizational assumptions, premises, goals and strategies are occasionally monitored, tested, and reviewed.

Accepted Answer

A) True 
 B)False

Question 10

The Sarbanes-Oxley Act of 2002 stipulates that executives of a firm will still be able to sell their shares in the firm when other employees cannot.

Accepted Answer

A) True 
 B)False

Question 11

Short-term objectives and action plans are types of boundaries that channel the efforts of employees toward goal accomplishment.

Accepted Answer

A) True 
 B)False

Question 12

Individual and institutional shareholders have the same rights that include all of the following except

Accepted Answer

A)  right to sell stock.
B)  right to vote the proxy.
C)  the right to bring suit for damages, if the economy declines.
D)  certain residual rights following the liquidation of the company, once creditors and claimants are paid.E) A) and B)
F) A) and C)

Question 13

Informational control is primarily concerned with whether or not the organization is doing the right things.

Accepted Answer

A) True 
 B)False

Question 14

In emerging economies and continental Europe, principal-principal conflicts are frequent. These consist of conflicts between controlling shareholders and executives.

Accepted Answer

A) True 
 B)False

Question 15

All organizations place the same emphasis on each type of control.

Accepted Answer

A) True 
 B)False

Question 16

As firms downsize, a control system based on rewards and culture becomes dysfunctional.

Accepted Answer

A) True 
 B)False

Question 17

The traditional approach to strategic control is interactive, while the contemporary approach to strategic control is sequential.

Accepted Answer

A) True 
 B)False

Question 18

According to Studzinski, in a 2014 Fortune magazine article, competing activist investor pressures push company management to decide between bottom line profits or social and environmental benefits. The company can only choose one or the other.

Accepted Answer

A) True 
 B)False

Question 19

Behavioral control is one of two types of strategic control and is concerned with strategy implementation.

Accepted Answer

A) True 
 B)False

Question 20

Top managers at ABC Company meet every Friday to review daily operational reports and year to date data. This is an example of

Accepted Answer

A)  behavioral control.
B)  informational control.
C)  strategy formulation.
D)  strategy implementation.E) A) and B)
F) None of the above

Exam 9: Strategic Control and Corporate Governance

The Sarbanes-Oxley Act of 2002 stipulates that executives of a firm will still be able to sell their shares in the firm when other employees cannot.

Correct AnswerverifiedShow Answer

Agency theory is concerned with the problem that arises when the goals of the agents conflict with those of the surrounding community members.

Correct AnswerverifiedShow Answer

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

The traditional approach to strategic control is interactive, while the contemporary approach to strategic control is sequential.

Correct AnswerverifiedShow Answer

The primary participants in corporate governance do not include the

Correct AnswerverifiedShow Answer

Individual and institutional shareholders have the same rights that include all of the following except

Correct AnswerverifiedShow Answer

Informational control is primarily concerned with whether or not the organization is doing the right things.

Correct AnswerverifiedShow Answer

In emerging economies and continental Europe, principal-principal conflicts are frequent. These consist of conflicts between controlling shareholders and executives.

Correct AnswerverifiedShow Answer

Public companies are required by law to disclose information regarding executive compensation packages.

Correct AnswerverifiedShow Answer

Rewards systems that reinforce the core values of the organization and contribute to organizational cohesiveness are the least effective type.

Correct AnswerverifiedShow Answer

According to Studzinski, in a 2014 Fortune magazine article, competing activist investor pressures push company management to decide between bottom line profits or social and environmental benefits. The company can only choose one or the other.

Correct AnswerverifiedShow Answer

The business media is a significant external control mechanism.

Correct AnswerverifiedShow Answer

Strategic control systems, both informational and behavioral, are used to correct the performance and ultimate strategy of a firm.

Correct AnswerverifiedShow Answer

As firms downsize, a control system based on rewards and culture becomes dysfunctional.

Correct AnswerverifiedShow Answer

Effective short-term objectives should be ______________ and _____________.

Correct AnswerverifiedShow Answer

Behavioral control is one of two types of strategic control and is concerned with strategy implementation.

Correct AnswerverifiedShow Answer

Double-loop learning in the contemporary approach to strategic control means that the organizational assumptions, premises, goals and strategies are occasionally monitored, tested, and reviewed.

Correct AnswerverifiedShow Answer

Top managers at ABC Company meet every Friday to review daily operational reports and year to date data. This is an example of

Correct AnswerverifiedShow Answer

Short-term objectives and action plans are types of boundaries that channel the efforts of employees toward goal accomplishment.

Correct AnswerverifiedShow Answer

All organizations place the same emphasis on each type of control.

Correct AnswerverifiedShow Answer

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Effective short-term objectives should be __ and _.

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