Putting Together a Capable Top Management Team

question 20

Multiple Choice

Putting together a capable top management team

• A)should take top priority in building competitively valuable core competencies.
• B)is particularly important when the firm is pursuing unrelated diversification or making a number of new acquisitions in related businesses.
• C)is important in building an organization capable of proficient strategy execution but is nearly always less crucial than doing a superior job of training and retraining employees.
• D)entails filling key managerial slots with people who are good at figuring out what needs to be done and skilled in making it happen and delivering good results.
• E)is particularly essential for executing a strategy to keep a company's costs lower than rivals' and become the industry's low-cost leader.

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Definitions:

Gross Investment

The total amount of capital expenditure a company spends on maintaining and increasing the scope of its operations.

Net Investment

The total spending on new fixed investment minus depreciation on existing physical assets.

Depreciation

The process of allocating the cost of a tangible asset over its useful life, reflecting the decrease in value due to use, wear and tear, or obsolescence.

Disposable Income

The net income available to an individual or household for saving or spending after income taxes have been deducted.