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Ethics is a question of personal scruples, a confidential matter between employees and their consciences and therefore for a leader it is acceptable to assume the company should not bear any responsibility for individual misdeeds.

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Functional benchmarking


A) is not very useful for organizations with a divisional organizational structure.
B) endeavors to determine best practices regardless of industry.
C) restricts the search for best practices to competitors.
D) is useful when researching industry-specific standards.

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Which of the following is an important characteristic of a leader?


A) satisfied with the status quo
B) goal-oriented
C) reactive
D) focused on past performance

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Which of the following does not explain why organizations are prone to inertia and slow to change?


A) personal time constraints
B) political barriers
C) vested interests in the status quo
D) entry barriers

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Designing the organization is the leadership activity that involves building structures, teams, systems, and processes that facilitate the implementation of leader vision.

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Political barriers to change can be overcome by promoting collaboration throughout the organization, as seen in the case study on Natura Cosmeticos of Brazil, in which CEO Carlucci implemented a comprehensive engagement process across the organization.

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Which of the following is not a part of the three broad sets of capabilities that a leader should possess?


A) technical skills
B) cognitive abilities
C) physical abilities
D) emotional intelligence

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In order to gather information from informal sources, successful executives must be good listeners.

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Leaders play an important role in sustaining organization culture, but they are powerless to change it.

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The chance of ethical crises occurring is enhanced if


A) the leader defines the corporate culture.
B) the organization has a weak ethical culture.
C) the shareholders have no confidence in the CEO.
D) employees follow the direction of the leader.

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People with strong self-awareness are neither overly critical nor unrealistically optimistic.

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Corporate codes of conduct provide norms and expectations to impede employees from committing unethical acts.

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Research supports that there are many potential benefits of an ethical organization, including that there is a strong and consistent relationship between ethical performance and measures of financial performance.

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As a manager, when faced with ethical crises you should


A) focus on issues most relevant to stockholders.
B) wait for the other party to make the first move.
C) take the initiative to address the problem.
D) cover up as much as possible.

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According to the Gresham law of planning, operational decisions do not drive out the time necessary for strategic thinking and reflection.

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Leaders risk creating a culture of fear and micromanagement if they


A) create personal connections with their people through frequent unannounced visits.
B) express their passion frequently.
C) keep their workforce motivated.
D) recognize the opinions of others so that they feel valued.

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Which of the following positive relationships is not supported with consistent results?


A) between ethical performance and measures of financial performance
B) between ethical performance and strong organizational culture
C) between ethical performance and increased employee efforts
D) between ethical performance and enhanced social responsibility

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Leaders as good role models must walk the talk. This means they must be _______ in their words and actions.


A) effective
B) reliable
C) consistent
D) trust-worthy

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____________ is rarely self-sustaining in an organization.


A) High-integrity
B) Integrity
C) Individual integrity
D) Leader integrity

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According to Michael Williams, director of Entrepreneurship Activities and the Business and Entrepreneurship Clinic at the University of Wisconsin-Madison School of Business, effective leaders must design an organization to achieve the direction they have laid out for the business. Which of the following is not a key element in that design?


A) creating core values that are simple, clear, direct
B) creating a transparent environment
C) creating an environment of accountability
D) creating core values that matter only to shareholders

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