Questions Chapter 10

Communicating Strategy and Developing Action Plans

 True/False Questions

Question Question stem Choice Reference

title

TF10.01 The difference between the term “business plan” and “action plan” as descriptors of F Implementation through
implementation strategies is that business plan is strategic and action plan is tactical. Action Plans
TF10.02 An effective action plan, regardless of level, consists of objectives that specify how the unit T The Level and Orientation of
(division, hospital, pharmacy) is going to contribute to the strategy, what actions will be the Strategy
required to achieve the objectives and within what time period, who is responsible for the
actions, the resources required to achieve the objectives, and how results will be measured.

TF10.03 Identifying objectives, determining who is responsible to accomplish them, the resources T The Level and Orientation of
required, and how results will be measured is an approach that keeps the strategic plan the Strategy
straightforward and comprehensible.

TF10.04 One of the organizational imperatives of strategic planning is that everyone in an organization F Action Plan Development
can be involved in the planning process. Responsibilities

TF10.05 The initial strategic plan for an organization is usually the product of a relatively small T The Level and Orientation of
number of strategic thinkers. the Strategy

TF10.06 Because of their involvement in the development of the strategic plan, every employee within F Communicating Strategy to
the organization knows the underlying issues and assumptions that were used to develop the Initiate Action Planning
strategy and the associated goals for the strategic plan.
Question Question stem Choice Reference
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TF10.07 Because everyone cannot be directly involved in developing a strategic plan, successive layers T Communicating Strategy to
of management must communicate the overall strategy and provide guidance for the various Initiate Action Planning
units that will need to be engaged if the strategy is to be achieved.

TF10.08 All communication within the organization concerning strategies and strategic F Communicating Strategy to
implementation should be “top down.” Initiate Action Planning

TF10.09 It is important to have specific milestones in the strategic planning process to provide updates T Communicating Strategy to
for all employees, telling them that the process is ongoing and explaining expected timelines for Initiate Action Planning
the strategy to be handed over to those who will be responsible for carrying it out.

TF10.10 The engagement of employees is not essential to implementing strategies. F Communicating Strategy to
Initiate Action Planning

TF10.11 Action plans concern translating directional, adaptive, market entry/exit, and competitive T The Process of
strategies into tasks, work assignments, and deadlines. Developing Action Plans
Question Question stem Choice Reference
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TF10.12 The establishment of measurements for results is not an element of developing an F Set Unit Objectives
action plan.

TF10.13 An action plan identifies actions required to accomplish objectives and the sequence in T Set Unit Objectives
which the actions should be undertaken.

TF10.14 A critically important responsibility of the health care organization’s leadership is to T Review the Broader
carefully articulate its strategy to the unit managers. Strategic Decisions

TF10.15 Unit manager action plans in aggregate represent the implementation plan for the T Set Unit Objectives
organization.

TF10.16 Concerning objectives, attainability as a characteristic is not necessary as long as the F Set Unit Objectives
objectives support strategic goals and are measurable.

TF10.17 Objectives should easily be accomplished. F Set Unit Objectives

TF10.18 Objectives should be formulated with the assistance of the individuals who will be T Set Unit Objectives
responsible for accomplishing the work.

TF10.19 For health care organizations, revenue expectations from plan implementation are more F Determine Resource
important than cost estimates since the revenues will offset the costs. Requirements

TF10.20 The Balanced Scorecard approach to strategy implementation is compatible with, and T Focusing on Strategy
complementary to, the value chain concept. through Implementation
– A Balanced Score
Card Approach
Question Question stem Choice Reference
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TF10.21 The primary value of the Balanced Scorecard approach is to focus the health care organization T Focusing on Strategy
on those aspects of its operations that most directly impact the accomplishment of its Through Strategy
strategies. Implementation
– A Balanced Score
Card Approach
TF10.22 Once developed and implemented, action plans operate on “autopilot,” without the need F Implementation Challenges
for managerial monitoring, evaluation, and adjustment.

TF10.23 Effective strategy implementation requires the same determination and effort as situation T Implementation Challenges
analysis and strategy formulation.

TF10.24 A primary reason why strategies are not implemented is because, in many health care T Implementation Challenges
organizations, effective or ineffective implementation makes little or no difference in resource
allocation and reward distribution.

TF10.25 Contingency planning may be incorporated into the normal strategic management process T Contingency Planning
at any level and is a part of managing the strategic momentum.

TF10.26 With well-defined directional strategies, there is little need to translate the strategic plans F Why Communicating the
into specific actions because the directional strategies will make the implementation clear. Strategy and Developing
Action Plans Are Important

TF10.27 Regardless of the level at which the strategic plan is developed, all action plans are F The Level and Orientation
required only at the unit level. of the Strategy

TF10.28 The development of the initial strategic plan is usually the product of a relatively few T Action Plan Development
informed and engaged strategic thinkers that can focus on the big picture. Responsibilities

TF10.29 Strategic leaders shape the strategic plan less by framing the context than they do by F Action Plan Development
deciding on the content of the plan. Responsibilities

TF10.30 Communication from the top down and the bottom up as well as across the organization is T Communicating Strategy to
required if everyone is to be engaged in the process. Initiate Action Planning

TF10.31 Stretch moves the organization toward its goals by leveraging resources or systematically T Set Unit Objectives
achieving more than is normally expected.
Question Question stem Choice Reference
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TF10.32 In action planning it is important to identify all the activities needed to accomplish and F Identify Actions
objective but the actual sequencing of the activities is not important as long as one focuses Required to Accomplish
on the objective. Unit Objectives

TF10.33 A process is a collection of activities that takes one or more kinds of inputs and creates and T Set Timelines
output that is valuable to an organizational stakeholder.

TF10.34 Strategic control is the process of determining if the strategy is successful and, where T Determine How Results
appropriate, taking corrective action. Will Be Measured

TF10.35 One of the valid criticisms of the Balanced Scorecard is that it evaluates strategy exclusively F Focusing on Strategy
on financial criteria and neglects some of the “softer” aspects of strategic success. through Implementation
– A Balanced Score
Card Approach

TF10.36 Successful strategy requires a willingness to seek the good of the entire organization over T Implementation
any individual division or unit. Challenges

TF10.37 Contingency planning is successful when it provides only one clear focus for the health care F Contingency Planning
managers because it avoids confusion with alternative paths to goal accomplishment.

TF10.38 Strategic plans are based on assumptions that are considered less likely because in this way F Contingency Planning
plans may always allow the health care leader to make less risky strategic decisions.

TF10.39 Continuity of operations planning is not an example of contingency planning. F What Is Continuity of
Operations Planning?

TF10.40 If the managers do not have a map it is difficult to start the journey. T The Map and the
Compass
 Multiple Choice Questions

Question Question stem Selections Choice Reference

title

MC10.01 Which of the following terms a- Business plans. c Implementation through

does NOT refer to b- Action plans. Action Plans
implementation strategies? c- Sequential plans.
d- Tactical plans.

MC10.02 An effective action plan a- Objectives that specify how the organizational unit will d The Level and Orientation of
consists of which of the contribute to the strategy and actions required to the Strategy
following elements? achieve the objectives.
b- Time period over which the actions will be taken and
who is responsible for the actions.
c- The resources required to achieve the objectives and
how results will be measured.
d- All of the above.

MC10.03 Within an organization, what a- The strategic planning team. b Action Plan Development
is the best choice for b- The organizational unit. Responsibilities
developing action plans? c- The chief executive officer.
d- The board of directors.

MC10.04 Successive layers of a- Provide “maintain or change” guidance. a Communicating Strategy to

management must b- Provide specific objectives and timelines. Initiate Action Planning
communicate the overall c- Provide detailed action plans.
strategy by doing which of d- Provide guidance only when a “change order” has
the following? been issued.
MC10.05 Specific milestones in the a- The strategic planning team. b Communicating Strategy to
strategic planning process b- All employees. Initiate Action Planning
should be communicated to c- The organizational unit.
which of the following d- The consultants involved in developing the
groups? strategic plan.
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MC10.06 Which of the following is a- Unit manager action plans are dictated by the d Communicating Strategy to
TRUE of unit manager strategic planning team. Initiate Action Planning
action plans? b- Unit managers do not develop action plans, they
implement action plans developed by their superiors.
c- Unit manager action plans only matter in situations
where “maintain” directions have been issued.
d- Unit manager action plans in aggregate represent the
implementation plan for the organization.

MC10.07 Which of the following is a- Objectives should reinforce organizational strategic c Set U n i t Objectives
NOT a characteristic that goals. Strategic goals relate to mission-critical activities.
should be demonstrated by Reinforcing objectives ensures that the various units
unit objectives? contribute to the accomplishment of the organization’s
mission.
b- Objectives should be challenging but attainable.
Objectives that are easy to accomplish do not require
stretch. Objectives that are impossible to attain are not
motivational.
c- Objectives should acknowledge the weaknesses of the
organization and the strengths of the action plan to be
implemented.
d- Objectives should identify the time frame for
accomplishment.

MC10.08 Budget requests associated a - Expected revenues. d Determine Resource

with unit objectives should b- Costs of personnel. Requirements
include which of the c- Costs of all resources associated with
following? implementing each activity.
d- All of the above.
Question Question stem Selections Choice Reference
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MC10.09 The primary value of the a- To focus the health care organization on those aspects of a Focusing on Strategy
Balanced Scorecard its operations that most directly impact the Through Strategy
approach is: accomplishment of its strategies. Implementation
b- To provide direction to unit managers in the – A Balanced
development of unit action plans. Scorecard Approach
c- To measure the success of senior management in
communicating the overall organizational strategy.
d- To inform lower-level employees of the need to pay
close attention to the detailed action plans being
implemented by their supervisors.
MC10.10 Contingency plans are: a- Specific time- and resource-oriented action plans to c Contingency Planning
achieve alternate sets of strategic goals.
b- Generic alternative plans.
c- Alternative plans that are put into effect if the strategic
assumptions change quickly or dramatically, or if
organizational performance is lagging.
d- “Gotcha” plans used to find unit managers who have
not been effective in implementing the organizational
strategy.

MC10.11 Which of the following are a- Budgets, control systems and decision support units. c Logic for Developing Action
components of action b- Strategic information systems and culture templates. Plans
plans: c- Objectives, activities, timetables, and responsibilities.
d- Tactics, policies and operating instructions.

MC10.12 The strategic planning a- Developing strategy through service delivery and support d Action Plan Development
team should determine strategies. Responsibilities
the broad strokes and b- Review the directional strategies.
shape the organization by: c- Provide guidance on what should be accomplished.
d- All the above.
Question Question stem Selections Choice Reference
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MC10.13 Which of the following is a- Assigning responsibility for accomplishing individual b The Process of
NOT a step in the actions. Developing Action
development of action b- Scanning the environment to ensure changing Plans
plans: conditions have been incorporated into the action plan.
c- Determination of resource requirements for
accomplishing each action.
d- Determination of how results will be measured.

MC10.14 Which of the following is a- Customer perspective. d Focusing on Strategy

NOT one of the areas of b- Learning/growth perspective. through Implementation
short-term activity not c- Financial perspective. – A Balanced Score
specifically linked by the d- Cultural perspective. Card Approach
overall strategy as
measured by the Balanced
Score Card:
MC10.15 If strategy is to be a- Performance evaluation system. d
Implementation
successful it must be b- Resource allocation system (budgeting).
Challenges
integrated into which of the c- Action planning systems.
following systems: d- All the above.
MC10.16 Which of the following is the a- Details of the individual action plans. b Action Plan
primary responsibility of the b- Broad strokes of the strategy. Development
strategic planning team: c- Individual linkages among strategic and tactical plans. Responsibilities
d- None of the above.
MC10.17 Which of the following a- Celebration of accomplishment of individual d Communicating
should be included in milestones. Strategy to Initiate
employee updates when b- Discussions regarding how the process is progressing. Action Planning
milestones are reached in c- Expected timelines for transferring the planning to the
the strategic planning implementation process.
process: d- All the above.

MC10.18 Strategic goals should: a- Be numerous since organizations are complex and a c Set Unit Objectives
number of areas must be addressed simultaneously.
b- Be very general in nature with little concern for
attainability since the main purpose of the goals is to
simply provide direction.
c- Related specifically to mission-critical activities.
d- Be impossible to obtain in order to be motivational.
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MC10.19 Strategic control is the a- Establishing the goals and objectives for the c Determine How Results
process of: organization. Will be Measured
b- Determining the activities required to accomplish goals
and organizing them under similar categories.
c- Determining whether the strategies are successful and
taking corrective action.
d- Matching the assumptions underlying strategic
decisions with the decision-making process.

MC10.20 A Balanced Scorecard is an a- Defining what is important to the organization. d Focusing on Strategy
effective tool for: b- Developing ways to measure strategic goals. through Implementation
c- Focusing the organization on its strategic direction. – A Balanced Score
d- All the above. Card Approach
 Short Essay Questions

Question Question stem Rationale Reference

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SE10.01 Discuss the “broad strokes” The development of the initial plan is usually the product of a relatively Action Plan
of strategy and action plans. small number of strategic thinkers – the strategic planning team. Development
Because of its involvement in developing strategy, the strategic planning Responsibilities
team determines the “broad strokes” of strategy. The team shapes the
organization through: a review or revision of the organization’s mission,
vision, values, and goals; development of strategy through service
delivery and support strategies; and providing guidance for what needs
to be accomplished. The implementation strategies or action plans,
however, should be left to the organizational units. Senior managers
shape strategic direction less by deciding the specific strategic content
than by framing the context – creating a sense of purpose that not only
provides an integrating framework for bottom-up strategic
initiatives but also injects meaning into individual effort. Others in the
organization should use their ingenuity to develop action plans and
carry out the strategy.
SE10.02 Discuss the importance of Because everyone cannot be directly involved, many employees within Communicating
communication in strategy the organization do not know the underlying issues and assumptions Strategy to Initiate
implementation. that were used to develop the strategy; nor do they know the goals for Action Planning
which they will develop objectives. Therefore, successive layers of
management must communicate the overall strategy and provide
“maintain or change” guidance for the various units that will need to be
engaged if the strategy is to be achieved. For example, if management
has determined that an expansion strategy is required, guidance is
needed as to which parts of the organization have been identified for
the expansion. Managers in the identified part or parts then determine
the objectives to accomplish the expansion in that area. When different
units have overlapping or integrated activities, multiple groups have to
coordinate planning. Communication from the top down and the bottom
up – as well as across – is required to engage everyone to do his or her
part.
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SE10.03 Discuss the need for and the Managing action plans involves agreeing upon objectives, measuring Implementation
methods used to manage performance, evaluating performance against the objectives, and taking through Action Plans
action plans. corrective action, if necessary. All of the units act in concert to ensure
that the level of actual performance comes as close as possible to a set
of desired performance specifications. Managing the strategy provides
strategic managers a means of determining whether the organization is
performing satisfactorily; it is an explicit process for refining or
completely altering the strategy. Therefore, strategic managers must
monitor, evaluate, and adjust the action plans. Strategic thinking to
evaluate action plans involves asking and answering a set of seven
questions: (1) Has the organization’s overall strategy been well
communicated to all members of the organizational units? (2) Do the
organizational units have the resources required for successful
implementation of the strategy? (3) Is there a high level of commitment
to the strategy within the organizational unit? (4) Has the organizational
unit developed action plans, including realistic objectives, timelines,
responsibilities, and budgets? (5) Are the unit objectives consistent and
compatible with the strategy? (6) Do the organizational units have the
managerial and employee capabilities required for successfully
implementing the organization’s strategy? (7) Do the combined action
plans accomplish the overall strategies of the organization?
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SE10.04 Discuss what is required for Successful implementation relies on communicating the strategic plan Chapter Summary
successful implementation of and developing action plans – the translation of organizational
a strategic plan. strategies into action plans. Otherwise, strategy remains little more than
wishful thinking. Action plans make strategy happen, yet strategy
cannot happen if people do not understand their roles in accomplishing
the strategies of the organization. It is important that the
interrelationships among situational analysis, strategy formulation, and
action plans are understood by managers and employees. Such
understanding is critical because, unless it is achieved, action plans are
unlikely to reflect organizational priorities. Action plans should contain
clear objectives that, when accomplished, will achieve the strategies of
the organization. These objectives should be measurable, easy to
understand, contain timeframes, and involve the individuals responsible
for accomplishing them in their formulation. If they are to be effective
guides to behavior, unit objectives – whether the unit is a division, a
single entity, or a department – must be understood and agreed on by
the members of that unit who are responsible for accomplishing the
tasks necessary to achieve the objectives. Action plans are important
aids to accomplish the strategies of health care organizations. They
outline the activities required for the accomplishment of each unit
objective along with an estimate of resources generated and expended
in the accomplishment of each unit objective. In addition, action plans
specify the time requirements for the accomplishment of each action
and the individual or group responsible for ensuring the action is
accomplished. Action planning is an effective aid in the formulation of
unit budget requests and when rewards are based on action plan
accomplishments, everyone recognizes their importance.
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SE10.05 How are action plans A critical factor in maintaining strategic momentum is strategy Practical Lessons for
important in maintaining evaluation and control. Through strategy evaluation and control Health Care Strategic
strategic momentum? managers regulate, guide, and direct the strategy and, within the Thinkers
process, emergent learning takes place and informs later strategy
formulation. Another important factor is effective communication of the
strategic plan. This is critically true when related to those individuals
who will be tasked with actually implementing the plan.

SE10.06 What are some of the Although many organizational resources are devoted to strategy Implementation
primary reasons why formulation, strategies are often not implemented for a variety of Challenges
strategies are not reasons including a lack of understanding of the strategy, a diversion to
implemented? more urgent demands for action, or a lack of appreciation for the
difficulty of actually making strategy happen. Understanding the many
likely conflicting attributes, ironies, or contradictions that occur in
attempting to manage the future is a good start toward better
comprehending strategy and implementation difficulties. Typically, more
attention has been given to strategy formulation and its link to
organizational performance than to the intervening process of strategy
implementation. In addition, the organization’s culture and hierarchical
structure may have been ignored and those responsible for
implementation may know little about the thinking that provided the
basis for the strategy.
SE10.07 It is agreed that strategic Managing the strategy provides strategic managers with a means of Strategic Thinking Map
managers must monitor, determining whether the organization is performing satisfactorily; it is an for Evaluating the
evaluate, and adjust action explicit process for controlling – refining or completely altering – the Action Plans
plans – in other words, they strategy. They do this by asking questions like the following: (1) has the
have to manage the organization’s overall strategy been well communicated to all members
strategy. How do they do in the organizational units? (2) do the organizational units have the
this? financial resources required for successful implementation of the
strategy? (3) is there a high-level commitment to the strategy in the
organizational units? (4) have the organizational units developed action
plans, including realistic objectives, timelines, responsibilities, and
budgets? (5) are the unit objectives consistent and compatible with the
strategy? (6) do the organizational units have the managerial and
employee capabilities required for successfully implementing the
organizational strategy? and (7) do the combined action plans
accomplish the overall strategies of the organization?
Question Question stem Rationale Reference
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SE10.08 Why is it important to assign A specific individual or group of individuals should be assigned the Action Plan
responsibilities for responsibility for ensuring that each activity is accomplished. Assigning Development
accomplishing the activities responsibility for the accomplishment of each activity in the proper Responsibilities
contained in action plans? sequence helps to build ownership. The assignment of responsibility
also provides another important function – in the periodic updates of
progress on the action plans, there is an identified spokesperson who
can provide precise updates on each activity. In addition, if individuals
know they will be called on to report at the update meetings, they are
incentivized to stay on schedule.
SE10.09 Why is careful articulation of A critically important responsibility of the health care organization’s Review the Broader
the organization’s strategy so leadership is to carefully articulate its strategy to the unit managers by Strategic Decisions
important to strategy providing guidance or strategy statements regarding their responsibility to
implementation? change or maintain the scope of their respective areas. These managers,
in turn, are obligated to continue the communication by articulating the
manner in which each unit is expected to contribute to service delivery or
support services as well as adaptive, market entry/exit, and competitive
strategies. Unit manager action plans, in aggregate, represent the
implementation plan for the organization.
SE10.10 What is contingency planning Contingency planning is the development of alternative plans that may be Contingency Planning
and why is it particularly put into effect if strategic assumptions change quickly or dramatically, or
important in dynamic, rapidly if organizational performance is lagging. This type of planning may be
changing organizational incorporated into the normal strategic management process at any level
environments? and is a part of managing the strategic momentum. Contingency planning
is really about resourcefulness. The more turbulent, discontinuous, and
unpredictable the external conditions, the more likely it is that unexpected
or dramatic shifts will occur and the greater the need for contingency
planning. Incorporating contingency planning requires top management
to have some very specific contingency plan triggers that are understood
by everyone and significant enough to require a change. Strategic plans
are based on the events and trends that management views to be the
most likely (the strategic assumptions). However, these events may not
occur, or trends may weaken, or accelerate far faster than strategic
managers anticipated. Therefore, contingency plans are normally tied to
key issues or events occurring or not occurring.