CHAPTER 8 – SETTING GOALS AND MAKING PLAN

41. In the Mainstream approach to organizational planning and goal setting, people at all levels of the firm
are involved in
a) developing the organization's mission and vision statements.
b) striving to fulfill SMART goals.
c) striving to fulfill SMART2 goals.
d) developing goals for a 360-degree evaluation.
e) setting strategic goals.
Ans: b

42. In the organizational planning process, ______ goals and plans, which mostly correspond to
nonprogrammed decision making, are evident in the organization's mission and vision statements.
a) change-oriented
b) strategic
c) operational
d) ongoing
e) standard
Ans: a

43. Once agreement is reached on goals, the next step in the Multistream goal-setting and planning process
is to develop and agree on the __________ that will be used to achieve those goals.
a) rules and regulations
b) standard operating procedures
c) action plans
d) vision statement
e) "living documents"
Ans: c

44. In Mainstream goal-setting, "SMART" goals are

a) Specific, Moral, Achievable, Realistic, and Time-specific.
b) Specialized, Measurable, Artistic, Results-based, and Timeless.
c) Stretched, Measurable, Altruistic, Realistic, and Time-specific.
d) Specific, Measurable, Achievable, Results-based, and Time-specific.
e) Specific, Meaningful, Agreed-upon, Results-based, and Time-specific.
Ans: d

45. In Multistream goal setting, "SMART2" goals are

a) Stretching, Meaningful, Agreed-upon, Results-based, and Timeless.
b) Significant, Meaningful, Altruistic, Rewarding, and Timely.
c) Specific, Measurable, Artistic, Realistic, and Time-based.
d) Significant, Measurable, Achievable, Realistic, and Time-based.
e) Significant, Meaningful, Agreed-upon, Relevant, and Timely.
Ans: e

46. __________ stretch goals are more consistent with Mainstream goal setting, whereas ___________
stretch goals are more consistent with Multistream goal setting.
a) Strategic; idealistic
b) Operational; strategic
c) Developmental; instrumental
d) Instrumental; developmental
 e) Timeless; time-based
Ans: d

47. When firms set goals and plans designed to maximize organizational productivity, they are exercising
a) acquisitive economics.
b) stretch goals.
c) a Multistream perspective.
d) corporate social responsibility.
e) standard operating procedures.
Ans: a

48. According to the ______________ approach to goal setting, as more key stakeholder groups participate
in the development of a firm's mission and vision statements, there will be wider appreciation for the
work of the organization.
a) Multistream
b) Mainstream
c) goal displacement
d) SMART
e) operational
Ans: a

49. According to the textbook, the discount retailers Wal-Mart and Costco both have mission statements
that express
a) Multistream values.
b) Mainstream values.
c) a bottom-up approach to goal and plans.
d) corporate social responsibility.
e) goal displacement.
Ans: b

50. Eric Aimes is a manager of a small company and must make a very important decision. In these types
of scenarios, Mr. Aimes does not consult other managers or stakeholders. What kind of a manager is
he?
a) Utilitarian
b) Fordist
c) Mainstream
d) Multistream
e) Progressive
Ans: c

51. Which of the following groups of stakeholders is(are) most involved in strategic goal setting?
a) Everyone in the organization
b) Top managers
c) Middle managers
d) Supervisors and subordinates
e) Top managers and middle managers
Ans: e

52. Which of the following groups of stakeholders is(are) most involved in developing the mission and
vision statements?
a) Everyone in the organization
 b) Top management
c) Middle management
d) Lower management
e) Middle management and lower management
Ans: b

53. According to the textbook, the city of Curitiba, Brazil, demonstrated Multistream planning and goal
setting, as evidenced by its including multiple stakeholders in the planning process by using an input
mechanism called
a) a groupthink round.
b) an interdisciplinary charrette.
c) a Delphi group.
d) ballot boxing.
e) contingency planning.
Ans: b

54. Regarding the typical Maintream approach to the four-step planning process,
a) managers set SMART2 (Significant, Meaningful, Agreed-upon, Relevant, Timely) goals in the
"operational planning" step.
b) employees seek to achieve competitive advantage in the "implementation and monitoring" step.
c) middle managers track progress to ensure that goals and plans are achieved during the "strategic
planning" step.
d) stakeholders seek to achieve mutual advantages during the "operational planning" step.
e) top managers establish the purpose and aspirations of the organization in the "mission and vision"
step.
Ans: e
55. Greg's main job in the organization is to develop contingency plans: operational goals and plans to
adopt in the event of various crises. Greg recommends these steps to limit the impact of a crisis:
a) be prepared, and do a good turn daily.
b) screen all stakeholders carefully, keep key information confidential, and hold an executive
meeting before deciding how to respond.
c) develop healthy relationships with key stakeholders, assemble information and define
responsibilities, and respond speedily.
d) form a crisis management team, and give each team member a pager so they can all be reached
24/7.
e) have all employees complete a course in CPR.
Ans: c

56. An organizational vision statement

a) identifies what an organization does, whom it serves, and how it differs from similar
organizations.
b) primarily defines the organization's target market for products and services.
c) is not related to strategic and operational goals.
d) describes what an organization is striving toward.
e) is a way to prepare for crises and reduce risks.
Ans: d

57. An organization's on-going goals and plans are reflected in its

a) mission statement.
b) operational goals and plans.
c) standard operating procedures.
d) All of these.
 e) None of these.
Ans: d

58. A corporation's mission statement most closely corresponds to its

a) ongoing goals and programmed decision making.
b) change-oriented goals and nonprogrammed decision making.
c) ongoing goals and nonprogrammed decision making.
d) change-oriented goals and programmed decision making.
e) change-oriented goals and contingency plans.
Ans: a

59. Jim is the new CEO of a company and he is changing the planning process. The changes are as follows:
decreasing its planning horizon to 7 years, increasing productivity by 2 percent, and increasing
earnings per share by $1.50/share in the next 4 years. Previously the planning horizon was 10 years,
productivity was not crucial to the company's goals, and EPS was not seen as a measure of success.
What type of planning shift seems to be taking place at this organization?
a) Multistream to Mainstream
b) Mainstream to Multistream
c) Increasingly Mainstream
d) Increasingly Multistream
e) None of these
Ans: a

60. Which of these is not part of the hierarchy of goals described in the textbook?
a) Mission
b) Vision
c) Strategic goals
d) Sales goals
e) Operational goals
Ans: d

61. Harry Hamburger is a senior executive at McDonald's. He wants to increase the company's market
share by 2 percent per year. What kind of goal is this?
a) Mission goal
b) Vision goal
c) Operational goal
d) Contingency goal
e) Strategic goal
Ans: e

62. Which of the following statements best describes the purpose of a firm's contingency plan?
a) It outlines specific steps for strategic planning.
b) It sets out in advance how a company will respond to a crisis or unexpected event.
c) It lays out the specific goals that subordinates are expected to meet.
d) When organizational members lose sight of Multistream ideals, contingency plans are
implemented to restore them.
e) It describes methods to develop stakeholder relations in Mainstream firms.
Ans: b

63. Alejandro's Travel Agency just had its computer system hacked. The hacker placed on the company's
computer system a virus that has crashed the system and prevented travel itineraries and ticket
 purchases from being processed. Agency managers are meeting in emergency session with a
computer consultant to develop a plan for recovering from this problem. However, the company
could have developed a ____________ earlier to be prepared for a situation like this.
a) contingency plan
b) consulting firm
c) vision statement
d) standing operating procedure
e) None of the above
Ans: a

64. A good mission statement identifies

a) what an organization does and whom it serves.
b) specific steps to achieve the organization's vision.
c) standard operating procedures.
d) contingency plans to be used in emergencies.
e) which organizational employees are responsible for each objective.
Ans: a

65. As a supervisor at Candy Mountain, Charlie notices that they are getting an increasing number of
customer queries by e-mail. If Charlie decides to set a goal to answer these queries personally within
24 hours, what level of goal setting is he demonstrating?
a) Mission and vision
b) Values and ethics
c) Strategic
d) Contingency
e) Operational
Ans: e

66. In the goal-setting/plan-making process, who sets the mission and vision of the company if the firm
operates from a Multistream perspective?
a) The CEO and other top-level managers
b) Top and middle managers together
c) Middle managers and union representatives
d) A wide collection of the firm's stakeholders
e) Firm shareholders at the annual shareholder meeting
Ans: d

67. Mario Dominguez has specifically chosen to operate his firm from a Multistream perspective. Which of
the following is most likely to be included in the firm's strategic goals?
a) A 5 percent increase in market share per year
b) A 10 percent return on investment
c) Placing among the top three in furniture design
d) Increasing shareholder value 8 percent per year
e) Obtaining a sustainable return on investment
Ans: e

68. An organizational mission statement is best described as

a) explaining what an organization does, whom it serves, and how it differs from similar
organizations.
b) expressing what an organization is striving toward.
c) ensuring that many stakeholders have an adequate understanding of the organization's goals.
d) an action plans that is a living document because it is revisited at regular intervals.
 e) None of these.
Ans: a

69. Contingency planning is part of what step in setting and achieving goals?
a) Implementing and monitoring goals and plans
b) Developing the organization's overarching mission and vision statements
c) Setting strategic goals and plans
d) Setting operational goals and plans
e) Setting new plans and goals when long-term feedback indicates that the outcome was
unsatisfactory
Ans: d

70. Managers at Gord's Electric thought that in order to best live up to its mission statement and work
toward its vision, the company had to set goals that included a 10 percent increase in its market share
each year, a 5 percent return on investment, and an increase of 7 percent in shareholder value. In
which goal-setting level for Mainstream management is Gord's Electric engaging?
a) Vision
b) Operational goals
c) Tactical goals
d) Strategic goals
e) Mission
Ans: d

71. Which of the following is not part of the four-step Mainstream approach to setting goals and plans?
a) Develop the organization's overarching mission and vision statements.
b) Set operational goals and plans.
c) Collaboratively develop operational goals and action plans.
d) Set strategic goals and plans.
e) Systematically implement and monitor goals and plans.
Ans: c

72. Mr. Wiggles is the manager of Nightcrawlers-R-Us. He has already developed the organization’s
overarching mission of providing his lakefront village with all of its angling needs. He has also set
strategic goals and plans. What is the next step in his Mainstream approach to goal setting and
planning?
a) Set tactical and operational goals and plans.
b) Convene multiple stakeholders to evaluate the strategic goals.
c) Implement and monitor all goals.
d) Encourage employees to boost productivity.
e) Re-evaluate the firm's mission and vision.
Ans: a

73. Which of the following is not part of the four-step process of setting goals?
a) Setting the organization's mission and vision
b) Setting the strategic goals and plans of the organization
c) Bringing the strategic goals down to the operational level
d) Determining competitors' best practices and putting them into action
e) Implementing the goals, monitoring how they are working, and adapting them as necessary
Ans: d
74. The Multistream manager of a Canadian furniture company has a mission to sell furniture in a
sustainable way. This manager's vision is most likely to be
a) to inspire others as an industry leader in the area of corporate social responsibility.
b) to be among the nation's three largest furniture manufacturers within 10 years.
c) to increase productivity by 2 percent in the next four quarters.
d) to double sales in three years.
e) to decrease inventory costs by 7 percent in 2 years.
Ans: a

75. When East Carolina Tea Distributors states that “We strive toward continued growth in the North
American tea market by providing the best-tasting, 100% natural tea products,” the statement is
representative of which level of goal setting?
a) Mission statement
b) Strategic goals
c) Tactical goals
d) Operational goals
e) Action goals
Ans: a

76. As marketing department manager of a Mainstream furniture company, Samika Johnson must
recommend to her supervisor an operational goal for her department. Which of the following would
be considered the best one for enhancing productivity and performance?
a) To encourage all employees to do their best.
b) To become the nation’s third-largest furniture manufacturer
c) To increase sales by 60 percent
d) To increase sales by 10 percent among upper-middle-class consumers in the next quarter
e) None of the above
Ans: d

77. Manager Joe Polaskiewicz is having trouble with his workers meeting his organization's expectations in
terms of how to perform their jobs. In an attempt to clarify expectations, he designs an outline with
specific steps on how to perform certain tasks, along with specific policies, rules, and regulations.
What has Mr. Polaskiewicz provided his workers?
a) Performance standards
b) Standing plans
c) Standard operating procedures
d) "Unspoken" or tactical goals
e) Contingency plans
Ans: c

78. In order to limit the impact of a possible network attack, Conglomerus Bank has assembled key
information that will help them if a virus infects the bank’s network. The bank has also designated a
security specialist spokesperson to address the public in such an event. Furthermore, it has developed
a detailed contingency plan outlining how it will respond to a virus, inform its clients, and provide
corrective services to those affected by the virus. What strategy (or strategies) has the bank thus taken
to limit the impact of the potential crisis?
a) Preparing for the crisis
b) Developing healthy, trusting relationships with all stakeholders
c) Planning a timely response
d) Preparing for the crisis and planning a timely response
e) Empowering all stakeholders
Ans: d
79. Which of the following actions is not consistent with the logic of contingency planning efforts?
a) Doing preventive work to avoid or minimize the affects of the crisis
b) Preparing for a crisis by assembling information that will be helpful if the crisis occurs
c) Meeting with diverse stakeholders to envision the best organizational future
d) Making a timely response, getting the truth out, and meeting safety and emotional needs
e) Continually monitoring key organizational parameters to be aware of potentially devastating
market developments
Ans: c

80. Managers in a start-up company try to determine the effect that a sudden 30 percent increase in sales
would have and develop plans to ensure that their organization could handle this situation. This is an
example of _______________.
a) contingency planning
b) performance standards
c) standing plans
d) setting strategic goals and plans
e) preparing a mission statement
Ans: a

81. When organizational members describe steps and actions (procedures) that are required to achieve the
goals that have been set, they are said to engage in
a) leading.
b) organizing.
c) controlling.
d) planning.
e) visioning.
Ans: d

82. Organizational plans are best described as

a) actions and processes that motivate organizational workers.
b) structures that coordinate resource flows throughout the organization.
c) steps and procedures that are required to achieve the goals that have been set.
d) mechanisms to ensure that all organizational efforts are productive.
e) actions aimed at innovation and entrepreneurship.
Ans: c

83. According to the four steps of the planning process, operational goals and plans consider which time
horizon?
a) Very long term (5 to 10 or more years)
b) 1 to 2 years
c) present to 6 months (immediate)
d) 3 to 5 years
e) 3 to 12 months (quarterly or annual)
Ans: e

84. According to the four steps of the planning process, strategic goals and plans consider which time
horizon?
a) Very long term (5 to 10 or more years)
b) 1 to 2 years
c) present to 6 months (immediate)
d) 3 to 5 years
e) 3 to 12 months (quarterly or annual)
 Ans: d
85. According to the four steps of the planning process, mission and vision consider which time horizon?
a) Very long term (5 to 10 or more years)
b) 1 to 2 years
c) present to 6 months (immediate)
d) 3 to 5 years
e) 3 to 12 months (quarterly or annual)
Ans: a

86. When organizational members set goals and plans for 5 to 10 years into the future, they are probably
considering:
a) organizational contingency planning.
b) the organizational mission and vision.
c) organizational strategic goals.
d) organizational operations.
e) organizational monitoring and controls.
Ans: b

87. An organization's mission statement and programmed decision-making process are most directly
reflected in its
a) contingency plans.
b) ongoing goals and plans.
c) monitoring processes.
d) change-oriented goals and plans.
e) innovation strategy.
Ans: b

88. An organization's vision and nonprogrammed decision-making process are most directly reflected in its
a) contingency plans.
b) ongoing goals and plans.
c) monitoring processes.
d) change-oriented goals and plans.
e) standard operating procedures.
Ans: d

89. Which of the following statements is most consistent with an organizational mission statement?
a) "to become the best provider of products and services in our industry"
b) "to change the world, one person at a time"
c) "to enrich people's lives through the written word"
d) "to hire one thousand employees in five years"
e) "to increase innovation to five new products per year"
Ans: c
90. Which of the following is not typically found in well-conceived mission statements?
a) Customers to be targeted
b) Organizational self-concept
c) Markets to be served
d) Organizational philosophy
e) Description of employee benefits
Ans: e
91. Which of the following is most likely to be found in a well-conceived mission statement?
a) Specific competitors to be targeted
b) Description of employee benefits
c) Corporate ethics code
d) Products and services to be offered
e) Crisis contingency plans
Ans: d

92. Which of the following factors is likely to have the greatest influence on the content of a firm's mission
statement?
a) The industry in which the firm competes
b) General economic conditions
c) The firm's governance structure
d) The geographic region where the firm's corporate headquarters are located
e) The number of organizational stakeholders
Ans: a

93. An effective organizational vision has all of the following characteristics except
a) future orientation.
b) ease of accomplishment.
c) inspirational ideas.
d) brevity.
e) clarity.
Ans: b
94. One World, a global capital firm, has the following vision statement: "One World will seek to become a
leader in the world financial markets, working in multiple markets and reaching multiple customer
segments in the process." Which of the following elements of an effective vision statement is not
represented in this example?
a) Future orientation
b) Inspirational
c) Challenging
d) Brief
e) Clear
Ans: e

95. Which of the following elements of the planning and goal-setting process is most specifically aimed at
achieving competitive advantage over other organizations?
a) Mission statement
b) Vision statement
c) Strategic goal setting
d) Operational goal setting
e) Contingency plan development
Ans: c
96. In the Mainstream operational goal-setting process, SMART goals are all of the following except
a) specific.
b) measurable.
c) achievable.
d) research-based.
e) time-specific.
Ans: d
97. In the Mainstream operational goal-setting process, SMART goals are
a) simplistic.
b) multifaceted.
c) achievable.
d) retroactive.
e) tamper-proof.
Ans: c

98. In the Multistream operational goal-setting process, SMART2 goals are all of the following except
a) significant.
b) market-based.
c) agreed-upon.
d) relevant.
e) timely.
Ans: b

99. Once SMART goals have been set, operational plans are developed. Which of the following is not
consistent with the "checklist for making a plan"?
a) Describe exactly what steps and actions are necessary to meet your goals.
b) Identify what resources are necessary to perform the activities.
c) Ensure that the required resources are available.
d) Identify in what order and when each action needs to be performed.
e) Conduct research aimed at assessing organizational performance.
Ans: e

100. Which of the following provide guidance for activities that are performed repeatedly and help
organizational members meet ongoing goals?
a) Contingency plans
b) Mission statements
c) SMART goals
d) Standing plans
e) Nonprogrammed goals
Ans: d

101. Which of the following set out in advance how managers will respond to possible future events that
could disrupt existing plans?
a) Contingency plans
b) Mission statements
c) SMART goals
d) Standing plans
e) Nonprogrammed goals
Ans: a

102. Which of the following represent a type of standing plan that outlines specific steps that must be taken
when performing certain tasks?
a) Contingency plans
b) Rules and regulations
c) Policies
d) SMART goals
e) Standard operating procedures
Ans: e
103. Which of the following represent a type of standing plan that specifies the proper response to various
types of situations?
a) Contingency plans
b) Rules and regulations
c) Policies
d) SMART goals
e) Standard operating procedures
Ans: c

104. Which of the following represent a type of standing plan that specifies actions that must be taken when
certain situations arise?
a) Contingency plans
b) Rules and regulations
c) Policies
d) SMART goals
e) Standard operating procedures
Ans: b

105. In terms of preparing for crises that affect the organization, effective managers would be expected to
do all of the following except
a) prepare a contingency plan.
b) assemble all organization members to vote on the best response methods.
c) do preventive work to minimize the impact of a crisis.
d) prepare for a crisis by assembling information and organization that is useful in such times.
e) make a timely response to the event when it does occur.
Ans: b

ESSAYS

127. Discuss the main differences between the Mainstream and Multistream approaches to planning and
goal setting.
Ans: The Mainstream approach involves many stakeholders, whereas the Multistream approach
involves mostly managers and owners. The Mainstream approach emphasizes acquisitive economics,
whereas the Multistream approach emphasizes sustenance economics. The Mainstream approach
requires financial solvency, whereas the Multistream approach simply requires socially beneficial
outcomes. The Mainstream approach focuses especially on managers, whereas the Multistream
approach focuses especially on employees.

128. Describe the critical differences between a Mainstream and a Multistream approach to goal setting and
planning, including differences in the "SMART" method.
Ans: There are many possible ways to answer this question. In the Mainstream approach, acquisitive
economics outcomes, such as profit, sales, and market growth, are the main guiding principles for
formulating goals. The Multistream approach emphasizes sustenance economics outcomes, such as
ecological well-being and social justice, in formulating goals. In the Mainstream approach,
organizational managers act as representatives of the interests of the organization's owners, whereas
the Multistream approach involves input from a much broader array of stakeholders in developing
goals and planning. Consistent with the focus on acquisitive economics, Mainstream SMART goals
are Specific, Measurable, Achievable, Results-based, and Time-specific. Multistream SMART2 goals
are Significant, Meaningful, Agreed-upon, Relevant, and Timely. This does not mean that
Multistream SMART2 goals do not have the qualities stressed in the Mainstream SMART approach
 to goal setting (Specific, Measurable, etc.). However, the Multistream approach places greater
emphasis on establishing goals that meet the needs of a greater body of stakeholders and achieve
outcomes that are sustainable and relevant to a larger community.
129. Give an example of how a firm might go about establishing goals and plans from a Multistream
approach. Be sure to include all steps of the planning process.
Ans: [Students may utilize any example here. They will need to include mission development, vision
development, strategic goals and plans, operational goals and plans, and monitoring and
implementation elements. Extra points should be awarded for inclusion of other relevant elements,
such as contingency plans. Students should emphasize elements of the Multistream approach, such as
inclusion of many stakeholders in the goal-setting process, sustenance economics outcomes, social
justice, and community well-being.]
130. Discuss the role, purpose, and process of contingency planning in organizations.
Ans: [Students should note that contingency plans are related to operational plans and are used only
in times of extraordinary events that disrupt normal operations and may even threaten the firm's
survival. Contingency plans set out in advance how managers will respond to such events. Credit
should be given for use of specific examples of events and responses. Contingency plans will have
preventive elements and will be timely. Contingency plans are aimed at reassuring key stakeholders
that the organization is in a position to continue normal operations in due time and will lay out a
timeline and process for recovery from the abnormal events.]