Question

True or false: Rather than ask her assembly line management team about the purchase of new equipment, Kerri decided to go ahead and make the purchase. She feels that as the executive director of operations, she has the authority to make this type of decision without consulting other managers in the organization. This is an example of strategic management.

Answer 1

The assertion in the question is false; the scenario describes an executive's unilateral managerial decision-making rather than strategic management, which should involve wide-ranging planning, stakeholder consultation, and goal-oriented coordination.

Step-by-step explanation:

The statement provided is false; this scenario does not exemplify strategic management. Instead, it highlights an instance of managerial decision-making at the executive level. Strategic management involves a broader set of activities, encompassing comprehensive planning, analysis, and coordination among different levels of the organization, including consultation with the board of directors and other key stakeholders to align decisions with the company's long-term objectives and the interests of shareholders.

In the context provided, top executives indeed have a strong voice in shaping the composition of the board of directors. Although they have significant decision-making powers, strategic decisions, like purchasing new equipment for an assembly line, often need board approval or at least some level of consultation with other managers, to ensure alignment with the firm's strategic direction and shareholders' interests. Hence, the autocratic decision by Kerri, described in the question, is more about hierarchical authority rather than collaborative strategic planning.