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Review moment
Exam
Name BMSE04 Exam 2019
Course BMSE04|2019|Corporate Entrepreneurship
Status Closed

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Result
Grade 5.6
Changed 
Score 28.2 (Maximum score: 50)
Result Pass

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Order by  Question number
Question 1 
Answered on Dec 20, 2019, 10:38:11 AM Duration 29 min. and 28 sec. Score 7.25 of 10 points

Corporate Entrepreneurship at 3M
3M has been known for decades as an entrepreneurial company that pursues growth through innovation. It generates a quarter of its annual revenues from products that are less than five years old. 3M started life as the
Minnesota Mining and Manufacturing Company back in 1902. Its most successful product –flexible sandpaper- still forms an important part of its product line but this now comprises over 60,000 products that range from
adhesive tapes to office supplies, from medical suppliers to traffic signs, from magnetic tapes and CDs to electrical equipment. Originally innovation was encouraged informally by the founders, but over more than a century
some of these rules have been formulized. Most important off all, however, there has built up a culture which encourages innovation. For example, there is a ‘hall of fame’ of staff elected on the basis of their innovative
achievements. And because this culture has built up a history of success, it perpetuates itself as well as helping the company to recruit people with innovative characteristics.

3M started life selling a somewhat inferior quality of sandpaper. The only way the company could promote this was by getting close to the customer – demonstrating it to the workmen that used it and persuading them to specify
their product – an early form of relationship selling. This was the first strategic thrust of the fledgling business – get close to customers and understand their needs. For example, when it developed its overhead projector
business it got technical staff to contact users to find out how the product could be improved. To this day it encourages close links with users.

However the company was desperate to move away from selling a commodity product and competing primarily on price, and its closeness to the customer led it to discover market opportunities that it had the expertise to
capitalize on. The first such product was Three-M-Ite Abrasive – an abrasive clothe using aluminum oxide for durability in place of a natural abrasive. This was followed by waterproof sandpaper – an idea bought from an
inventor who subsequently came to work for 3M. This was followed shortly by Wetordry – a product designed for use by the car industry in finishing bodywork. And with this the second strategic thrust of the company was
developed – to seek out niche markets, no matter how small, which would allow it to charge a premium price for its products. The company began to realize that many small niche markets could prove to be more profitable than
few large ones.

In the 1990s this began to change somewhat, to the extent that some technologies became more sophisticated and the investment needed to develop new products increased. Therefore the required return became larger and
markets needed to be correspondingly bigger. Luckily the world was increasingly becoming a global market place. At the same time, competition was becoming tougher and the rapidity of technological change and shortening
of product life cycles made 3M recognize the need to dominate any market niche quickly – so refining its second strategic thrust. Speed of response was vital. By the 1990s many of the market niches 3M was pioneering were
turning out to be not that small at all particularly in the global market place. So the approach remained the same, but the speed of response and seize of market niche, world-wide, increased.

The company really started to diversify when it entered the tape market in the 1920s, but even this built on its expertise in coatings, backings and adhesives. What is more, the way the first product evolved demonstrates
perfectly how an entrepreneurial architecture works. By being close to its customers 3M saw a problem that it was able to solve for them through its technical expertise. In selling Wetordry to car body finishers, an employee
realized how difficult it was for the painters to produce the latest fad in car painting – two-tone paintwork. The result was the development of masking tape – imperfect at first, but developed over the years ‘out-of-hours’ by an
employee to what we know it to be today, and from that technology developed the Scotch range of branded tapes. So, the third strategic thrust was developed- diversify into the related areas identified as market opportunities
by customers. Once 3M found a niche product to offer in a new market, it soon developed other related products and developed a dominant position in the new market. In the 1990s 3M came to recognize that it did best when it
introduced radically innovative products into a niche market in which it already had a toehold.

This experience not only taught 3M the value of research but also to appreciate maverick inventors who were so attached to their ideas that they would push them through despite the bureaucracy of the company. In the late
1920s it developed the policy of allowing researchers to spend up to 15% of their time working on their own projects. To this day, it tries to make innovation part of the corporate culture by encouraging staff to spend 15% of their
time working on pet ideas that may one day become new products for the company. The company accepts that this can take time. Although staff are encouraged to ‘bootleg’ resources early in the development, they can also
get money to buy equipment and hire extra help once an idea is accepted. To get an idea accepted, they must first get the personal backing of a member of the main board. Then an inter-disciplinary team of engineers,
marketing specialist and accountants is set up to take the idea further. Membership of these teams is encouraged and often voluntary. Failure is not punished, but success is well rewarded.

Perhaps the best-known contemporary example of the success of this policy is the developments of the Post-IT Note by Art Frye in the 1980s. He was looking for a way to mark places in the hymn book- a paper marker that
would stick, but not permanently. At the same time the company had developed a new glue which, unfortunately as it seemed at the time, would not dry. Art spotted a use for the product but what was different was the way he
went about persuading his bosses to back the project. He produced the product complete with its distinctive yellow colour, and distributed it to secretaries who started using it throughout 3M. Art then cut their supplies, insisting
that there would be no more unless the company officially backed the product. The rest is history.

So the fourth strategic thrust of the company was developed – to pursue product development and innovation at every level in the organization through research. This was formulized when the Central Research Laboratory was
set up in 1937, but maverick research continued to be encouraged. In 1940, a New Product Department was developed to explore the viability of new products or technologies unrelated to existing ones. In 1943, a Product
Fabrications Laboratory was set up to develop manufacturing processes. In the 1980s four Sector Labs were created with a view to being more responsive to the market place and undertaking medium-term research (5-10
years). The Central Lab renamed the Corporate Lab, was maintained to undertake more long- term research (over 10 years). In addition most of the Divisions had their own Labs undertaking short term, developmental
research (1-5 years).

3M has always been admired for its ability to share knowledge across the organization and link technologies to produce numerous products that could be sold in different markets. It has a Technology Forum, which seeks to
encourage ‘free and active interchange of information and cross-fertilization of ideas’. One product of this interchange is Scothlite Reflective Sheeting used for road signs, developed in the 1940s – in fact as a result of failed
research to develop reflective road markings. This combined research from three different laboratories to produce signs with a waterproof base onto which a covering of an opaque, light reflecting pigment was added followed
by microscopic beads. This was all sealed with a thin coat of plastic to ensure weather durability. The fifth strategy had emerged- get different parts of the organization to communicate and work together and, most important of
all, share knowledge.

This became formalized in the 1950s with the establishment of the Technical Forum, set up with the aim of sharing knowledge across the company. It held annual shows. Out of this came the Technical Council, made up of
technical directors and technical personnel, which met several times a year to review research and address common problems. Alongside this the Manufacturing Council and then the Marketing Council were established. At the
same time technical directors and researchers regularly moved around different divisions. The fifth strategy was in place – to share knowledge across the company.

The culture in 3M evolved out of its place of origin and has been called ‘Minnesota nice’. It has been described as non-political, low ego, egalitarian and non- hierarchical as well as hardworking and self-critical. It has also, at
least in its earlier days, been described as paternalistic in its approach to employees. Above all, 3M is achievement-orientated and achievement, particularly in research, is rewarded, often through promotion. For example
successful new product teams were spun off to form new divisions. The leader of the team often became general manager of the new division and this was seen as a great motivator. Lesser achievements were also
acknowledged. Researchers who consistently achieved ‘high standards of originality, dedication and integrity in the technical field’ - as judged by their peers, not management – were invited to join the exclusive ‘Carlton
Society’. The ‘Golden Step’ and ‘Pathfinder’ awards were also given to those helping develop successful new products. Achievement was lauded at all levels. Strategy six was emerging – to encourage achievement through
reward.

Today 3M faces many challenges to maintain its reputation for innovation. As it becomes larger and more complex, involved in different markets with different products and technologies, at different stages off their life cycle, it
recognizes that different managerial approaches may be necessary. The ‘maverick’, high-risk approach to research and development may not be appropriate in certain sectors. The 25% rule – the proportion of new product
sales – may not be achievable by all Divisions. 3M also faces stiffer competition which means that cost economies have had to be made to maintain profitability. As a result the 15% rule – slack time to research new products –
is under severe pressure, to the point where it is described as more of an attitude than a reality. Nevertheless, 3M has for over a century successfully practiced corporate entrepreneurship.
In lecture 1, we talked about corporate entrepreneurship and the role of managers. In one of the required readings of this lecture titled “Strategizing throughout the Organization: Managing Role Conflict in Strategic Renewal”,
Floyd and Lane (2000) distinguish between three subprocesses of strategic renewal. Two of the three processes reflect the top-down and bottom-up models of strategic behavior (Burgelman, 1983, 1984).

Give the names of these two processes and describe how they work. Include the different roles of top-, middle-, and operating managers in your answer. (6 points)

Top-down - Formal structure for stimulating entrepreneurial behavior that are encouraged by top management. Top management relays a structure and innovation ideas from the top, especially based on observations of
changer markets and competitive landscape (large scale, big-picture thinking) to middle-managers. Middle managers are in charge of relaying that information to operating managers who then implement the new policy.
Operating managers are in charge of implementation and middle managers are then in charge of making sure they are implemented and relaying feedback back to top managers.

Bottom up - Operating managers who are on the front lines with customers recognize where the pitfalls are or how to improve the organization, sometimes directly from consumer feedback and from interactions with
consumers on a daily basis. They can come up with new ideas to help address these pitfalls or better the organization and propose them to middle managers. Middle managers then select ideas that are good and allow
the operating managers to implement them in select stores. If successful, middle managers will champion these ideas to top management. If top management deems this a viable initiative, then they will disperse the idea
across different branches and across the organization.

Word count: 197 (character count: 1294)

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In the same paper, Floyd and Lane (2000) also discuss strategic role conflict.
Describe what strategic role conflict is and give an example of a situation in which middle-managers might experience strategic role conflict. (2 points)

Strategic role conflict is the balance between the need to succeed and be efficient at the current task at hand and perform the current position well, while also being able to explore new ideas and develop ways to improve
the organization.
Middle managers may face this in supermarkets, for example, when trying a new structure for inventory. If they deem that the current method of categorizing products makes it hard for customers to find products, then
they may restructure the store. However, this restructure takes time out of the work day, may result in the store having to close for a few hours if employees do not work overtime, and in the immediate future may result in
employees being less used to the layout and slower when restocking or pointing out products to customers.

Word count: 134 (character count: 784)

During the lecture, we discussed that a top-down view on Corporate Entrepreneurship essentially is a “formal tolerance of informal entrepreneurial behavior”.
What does a “formal tolerance of informal entrepreneurial behavior” mean? Please explain. (1.5 point)

Informal entrepreneurial behavior is initiatives that managers can take to address downfalls in the current organization or explore new ideas that can bring the organization to a better level. These are informal because
they can entail anything and do not have a specified structure to them and are done independent of the company. Formal tolerance means official support and encourage from top management that encourages such
behaviors and provides resources to develop these ideas and give the platform for lower management to communicate these ideas and implement them if successful.

Word count: 90 (character count: 586)

Read the case text Corporate Entrepreneurship at 3M. Give two examples of formally supported informal entrepreneurial behavior at 3M. (1 point)

- Allowing researchers to spend up to 15% of their work time on their own projects and till this day encourage staff to spend 15% of their time on these pet projects that may one day be implemented into 3M
- Technical forum where researchers can exchange ideas and share their knowledge

Word count: 52 (character count: 287)

Score part a: 0 Correction criterion:

(max 4.5 points) The top-down model is the competence deployment subprocess
0.25 Correction criterion:
Competence deployment involves the adjustment of organizational structure, systems, and people to fit the strategy (i.e., structure follows strategy)
0 Correction criterion:
Top-down: Top-managers have a directing role
0.25 Correction criterion:
They determine the firm’s / competencies / strategic position / strategy / allocation of organizational resources / direction
0 Correction criterion:
Top-down: Middle-managers have an implementing role
0 Correction criterion:
They implement the current strategy / increase the scale of current competencies (chosen direction)
0 Correction criterion:
Top-down: Operating managers have a conforming role
0 Correction criterion:
They adapt their operating procedures / work / policies to conform with the current strategy (chosen direction)
0 Correction criterion:
The bottom-up model is the competence definition subprocess
0.25 Correction criterion:
Competence definition involves the experimentation with new skills and exploration of new market opportunities (i.e., strategy follows structure)
0 Correction criterion:
Bottom-up: Top-managers have a ratifying role
0.25 Correction criterion:
They ratify the initiatives with the most potential (and adjust the strategy accordingly)
0.25 Correction criterion:
Bottom-up: Middle-managers have a championing role
0.25 Correction criterion:
They evaluate the long-term implications of the experiments and champion the most promising ones to top management
0 Correction criterion:
Bottom-up: Operating managers have an experimenting role
0.25 Correction criterion:
They experiment with novel solutions to emerging problems

Score part b: 1 Correction criterion:

(max 2 points) Strategic role conflict occurs when managers face inconsistent behavioral expectations based on the need to efficiently deploy existing competencies and the need to
experiment with new ones (Floyd & Lane, 2000: 154)
1 Correction criterion:
The example shows that a middle-manager experiences different expectation from top- and operating management

Score part c: 1. Correction criterion:

(max 1.5 points) 5 Explanation: A formal tolerance of informal behavior means that the firm’s strategy and structure provide a context in which entrepreneurial behavior is stimulated and
promoted

Score part d: 2 Correction criterion:

(max 2 points) Examples (1 point per example): (1) hall of fame’ of staff elected on the basis of their innovative achievements; (2) recruit people with innovative characteristics; (3) get
close to customers and understand their needs; (4) allowing researchers to spend up to 15% of their time working on their own projects; (5) they can also get money to
buy equipment and hire extra help once an idea is accepted; (6) employees can become a member of inter-disciplinary team of engineers, marketing specialist and ac-
countants is set up to take the idea further; (7) Failure is not punished, but success is well rewarded; (8) pursuit of product development and innovation at every level in
the organization through research; (9) a New Product Department was developed to explore the viability of new products or technologies; (10) most of the Divisions had
their own Labs undertaking short term, developmental research; (11) Technology Forum, which seeks to encourage ‘free and active interchange of information and
cross-fertilization of ideas; (12) technical directors and researchers regularly moved around different divisions; (13) encourage achievement through reward.

Given score: 7.25

Question version identifier: 803c8530-9a60-73a0-3a3a-b415254de500

Question 2 
Answered on Dec 20, 2019, 10:42:15 AM Duration 11 min. and 42 sec. Score 4.5 of 10 points

In lecture 2 ("Social Networks, Social Capital, and Intrapreneurship"), we discussed two types of social capital and their effects on the innovative behavior of employees. In the paper “Social Networks, the Tertius Iungens
Orientation, and Involvement in Innovation”, David Obstfeld (2005) claims that each of these two network structures pose a certain problem when it comes to innovation and introduces the Tertius Iungens Orientation as a
different perspective on intrapreneurship.
Describe the two types of social capital in terms of their network structure. (3 points)

Closed network - everyone is interconnected, the middle person knows the people surrounding them and the people surrounding also all know one another. One node in the middle with lines to surrounding nodes, and
surrounding nodes also have lines connected to each other (not just the middle node)

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Brokerage network - the one middle person is the link between everyone else, everyone around the middle person only knows the middle person but not each other. One node in the middle with lines to surrounding
nodes, and surrounding nodes only have lines to the one middle node but not to anyone else.

Word count: 101 (character count: 596)

Describe the advantages they offer and the problems they pose with regard to innovative behavior. (4 points)

Closed network advantage - speak the same language, easy to communicate and spread/implement new ideas, trust because of social pressure (if someone acts outside of the norms that are implied then the rest of the
group will shame the member so members are discouraged from deviating from normal behavior)
Closed network disadvantage - difficult to come up with new ideas since there is very little room to maneuver and everyone has already settled into the norm. New ideas are sometimes shut down by other members who
do not want change or do not see a point in change.
Brokerage network advantage - easy to come up with new ideas, early access to innovation, control advantage so get access to ideas before anyone else and can control how people interact giving the middle person
power
Brokerage network disadvantage - difficult to implement ideas because there is less trust, hard to spread, a lot of pressure on the middle person to communicate with everyone

Word count: 162 (character count: 961)

Decribe theTertius Iungens orientation and explain how this perspective on intrapreneurship differs from the two types of social capital mentioned above. (3 points)

Network structure constantly shifts as the organization evolves and different people are introduces and start communicating with each other more. Intrapreneurship means that an employee can take initiative and new
ideas to improve the organization by sourcing from a brokerage network style. However, they can also tap into the resources that the company already has such as infrastructure and data, in a similar way that closed
networks use. Intrapreneurship gives the best of both worlds. It is different in that there is less pressure on just one person (like the brokerage network has) once a connection is made but also unecessary connections
are not made if they are not useful.

Word count: 110 (character count: 684)

Score part a: 0.5 Correction criterion:

(max 3 points) One type of social capital is called brokerage (equivalent terms: Sparse Network; Brokerage; Networks with Structural Holes)
0.5 Correction criterion:
Brokerage is about connecting otherwise unconnected people (i.e., people that are not directly connected themselves
0 Correction criterion:
Brokerage is characterized by low network density, low transitivity, many structural holes
0.5 Correction criterion:
The other type of social capital is called closure (equivalent terms: Dense Networks; Closure; Cohesion; Cohesive Network
0.5 Correction criterion:
Closure is about being part of a dense network of relationships (i.e., in which most or all people are directly connected themselves
0 Correction criterion:
Closure is characterized by high network density, high transitivity, few structural holes

Score part b: 0 Correction criterion:

(max 4 points) . Brokerage has an information advantage: access to diverse knowledge stimulates idea generation and creates opportunities for the novel combination and recombina-
5 tion of ideas. (Obstfeld, 2005: 101)
0 Correction criterion:
. Brokerage leads to an action problem: the action problem hinders idea implementation. The dispersed, unconnected people found around structural holes are inherently
5 more difficult to mobilize or coordinate, especially around novel ideas. People surrounding structural holes have different interests, unique perspectives, and employ dif-
ferent language. (Obstfeld, 2005: 101)
1 Correction criterion:
Closure has the advantage of shared language, support and trust, which stimulates idea implementation. (Obstfeld, 2005: 101)
0 Correction criterion:
. Disadvantage: the idea problem hinders idea generation. Dense networks present an idea problem because of the redundancy of information circulating within the net-
5 work (Granovetter, 1973; Obstfeld, 2005).

Score part c: 0 Correction criterion:

(max 3 points) A Tertius Iungens orientation is a strategic behavioural orientation toward connecting people in one’s social network by either introducing disconnected individuals or fa-
cilitating new coordination between connected individuals.
0 Correction criterion:
Brokerage and closure describe the structural position of a person in her/his social network. They therefore provide a static account of social capital. The Tertius Iun-
gens Orientation is a behavioural attitude focused on change / behavior.
0 Correction criterion:
While brokerage explains idea generation and closure idea implementation, Teritus Iungens Orientation explains people’s involvement in innovation

Given score: 4.5

Question version identifier: bbb34ed0-fc1c-9dab-bef6-4ed1ffadc920

Question 3 
Answered on Dec 20, 2019, 10:42:52 AM Duration 14 min. and 3 sec. Score 5.2 of 10 points

 Response model changed by JS Breet on Jan 13, 2020, 4:30:44 PM for reason "Response model 3a changed"

Corporate Social Entrepreneurship (CSE) was the topic of the third lecture.
What are the differences between CSE and Corporate Social Responsibility (CSR)? (2 points)

CSR is usually just a separate department in the company focused mostly on public relations and long term helping of the environment (people and planet) with less regard to profits in the short run.
CSE is a different way of looking at helping the environment while also keeping profits in mind and improving both simultaneously. It comes up with ways to advance the CSR journey while also helping the bottom line
that can be implemented on a larger scale.

Word count: 79 (character count: 456)

The paper of Kuratko et al., (2012) “Conceptualizing the development of a social corporate entrepreneurship scale” examines corporate entrepreneurial strategies within the context of “social business”. Besides the five
underlying factors—management support, autonomy, rewards, time availability and organizational boundaries—that stimulate CE, the authors include four underlying factors that stimulate CSE. Name the four factors and
explain what these entail. (4 points)

Stakeholder salience - stakeholders recognize their role and interactions with one another
Social proactiveness - taking initiative to address social problems before they even arise or become an issue (eg reducing risk of polluting lakes by building better pipes since the start instead of just cleaning up the lake
once you have polluted it)
Governance - rules and regulations in place from the top management to ensure efforts are seen through
Transparency - disclosure with the public (usually complying with increasingly strict regulation) on operations and data

Word count: 87 (character count: 566)

During the second half of the lecture, the case of Tennet was extensively discussed by Jeroen Dicker. Name two underlying factors for stimulating CE and two underlying factors for stimulating CSE that you have identified in
the Tennet case. Please explain why you would argue that these were the most obvious in the story of Jeroen and explain your answer. (4 points)

CE: expanding into bigger European market and reducing operating costs - these are the most important as they are key to giving Tennet a competitive advantage in Europe and maintaining that advantage across
competitors who are no doubt also trying to innovate and also start-ups with brand new ideas.
CSE: Using more eco-friendly energy harvesting methods (eg wind) and attracting financiers that are environmentall concerned (i.e. green bonds). These are importnat as eco-friendly energy not only is good for the
environment but also good for the bottom line since for these, apart from infrastructure costs, are almost free and there is a lot of space in the seas, for example, to harvest wind. Green bonds are also key because they

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still give Tennet the money needed to fund initiatives and leverage (ie not having to use their own money but borrow from investors instead, improving the overall profit margin) while also getting to attract the right
investors who share concerns about improving the environment so there is less conflict between money and environment.

Word count: 173 (character count: 1070)

Score part a: 2 Correction criterion:

(max 2 points) CSE provides an approach that will accelerate the CSR journey. CSE is not another form of CSR but rather a process for stimulating and advancing the development of
CSR.
0 Correction criterion:
CSE is focused on creating shared value; both economic and value for society. CSE tries to find a way to improve aspects in the value chain to benefit the company and
create value.
0 Correction criterion:
CSR follows governments, policies to limit harm to society. It is mainly a separate department and not related to the core business of a company.
0 Correction criterion:
CSE: is about people within the firm, creating a platform, mindset, integrated in the company. Intrinsic, bottom up, creative and entrepreneurial. CSR: a department with-
in a company, top down, separate from other departments and the core of the business.

Score part b: 0 Correction criterion:

(max 4 points) . Definition: Stakeholder Salience
5
0 Correction criterion:
. Explanation: understanding each role of the stakeholder maintaining relationships with them. Primary those without their participation the firm would not exist, secondary
2 those that influence the company. These stakeholders can be allocated based on: Power (power of stakeholders to influence the behavior in the company), legitimacy
5 (legal moral bonds between stakeholders and the company) Urgency (the extent to which the company is called to take action based on the stakeholders claim).
0 Correction criterion:
. Definition: Social Proactiveness:
5
0 Correction criterion:
. Explanation: Organizational posture on how it response to its environment. Companies can be reactive or defensive, accommodating or proactive. Reactive (doing less
2 than is required), Defensive (the company does the least required), Accommodating (the company does the required) and Proactive (the company does more than is re-
5 quired). The company actively changes its environment rather than changing because of survival needs or external pressure
0 Correction criterion:
. Definition: Governance
5
0 Correction criterion:
. Explanation: mechanisms in place to assure managers strive to achieve outcomes that include Social Corporate Entrepreneurial goals
5
0 Correction criterion:
. Definition: Transparency
5
0 Correction criterion:
. Explanation: performance on environmental social value: disclosure. The company openly publishes its performance scores on social indicators. This transparency is
2 needed in order to establish dialogues with stakeholders and adjust the strategy accordingly.

Score part c: 0 Correction criterion:

(max 4 points) The underlying CE factors are:
• Management Support:
after not succeeding with the first project Jeroen Dicker received support and the trust from the BoM to continue with the Green Bunds. He got promotion of creating so-
cially friendly innovations. For example the wind track that was developed and championed inside the corporation for minimizing magnetic field while at the same time
improving flow of electricity.

• Autonomy/Work discretion:
Jeroen Dicker described the moderate of tolerance to failure but the work discretion he experiences when elaborating a plan that he acknowledges to have failed: The
Burgergleihe.

• Rewards:
Jeroen Dicker described that his salary/bonus was not depending on success. His first project the Burgergleihe failed, yet he remained his position. Also he has been
rewarded for the Green Bunds project. This project was successfully implemented and therefore Jeroen received a payraise.

The answer should:

• Mention two of the above underlying factors (0,5 point; 0.25 per factor)
• Explain how these factors were applied/mentioned In the Tennet case presentation of Jeroen Dicker. (So the right explanation for the chosen factor: 1,5 points; 0,75
per explanation)
0 Correction criterion:
Two underlying CSE factors. The underlying CSE factors are:

• Transparency:
Jeroen Dicker provided a lot of examples of their publications, year reports, green finance report and the Halo. Halo tries to become investment ratings for CO 2 foot-
print companies. All these examples make clear that Tennet is very transparent in their disclosure of all CSE activities.

• Stakeholder salience:
Example of failed project where they held a lot of stakeholder meetings and even try to provide interests rates for stakeholders. Jeroen Dicker mentioned that Tennet
emphasized the great value of stakeholder dialogues with multiple shareholders: -Customers (they created a portal where customer centric service are promoted, -Em-
ployees: safety first, - NGO’s: work in cooperation with NGOs that help Tennet measure its performance, - visiting homes in Arab countries.

• Social Proactiveness:
Tennets posture is focused on the way the market and its environment is currently changing. Based on Jeroen Dickers story it can be concluded that Tennet maintains a
Proactive posture since it does more than is required. One of their goals is to make renewable energies accessible to all citizens in the Netherlands.

The answer should:

•Mention two of the above underlying factors (0,5 point; 0.25 per factor)
• Explain how these factors were applied/mentioned In the Tennet case presentation of Jeroen Dicker. (So the right explanation for the chosen factor: 1,5 points; 0,75
per explanation

Given score: 5.2

Comment
On part b: some explanations are too short and incomplete

Question version identifier: 7827978e-9b80-6963-8f42-3a870d47a9d7

Question 4 
Answered on Dec 20, 2019, 10:57:30 AM Duration 15 min. and 5 sec. Score 6.25 of 10 points

During the fourth lecture, we discussed two modes in which organizations can balance exploration and exploitation.

Read the following excerpt from the Jumbo case:

“Innovation began in the company as a disruptive process. Food market and city concepts were new to the supermarket retail industry, so they began building dedicated teams to work solely on innovation and the formula with
developments in service and assortment. They did that separately from regular business, testing the entire operation and logistics of new projects on a small scale first. Only when the results were positive and customers were
enthusiastic, they did transfer the projects to real business at scale.”

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What is the name of the approach to ambidexterity described in this excerpt? Give the name and describe how this appraoch works. (2.5 points)

Structural ambidexterity
A dynamic capability where a new department is set up to work solely on a new innovation. They have their own dedicated team and resources to work on the innovation as much as they want. Once implemented the
innovation is monitored for success and if successful then the innovation is the selected by top managers who disperse the information and implement across the entire organization.

Word count: 67 (character count: 413)

Describe the challenge that organizations in general face if they implement this approach. (2 points)

It is difficult to be able to leverage resources that the company already has if a new team is set up. With a new team, there is a lot of friction within the organization and it is hard to get collaboration between departments.
It is also difficult to spread the idea throughout the whole organization, especially when the people throughout the organization may not be as excited and buy into the new innovation as much as top management or the
team that worked on it. It will also be difficult to integrate the new department into the wider organization as they have almost certainly already developed their own different culture and working styles.

Word count: 113 (character count: 650)

The paper by Jansen, Tempelaar, van den Bosch, & Volberda (2009) titled “Structural Differentiation and Ambidexterity: The Mediating Role of Integration Mechanisms” presents four mechanisms that can help organizations to
deal with this challenge.

Name two of these mechanisms and describe how they mitigate the challenge you described above. (3 points)

- Informal social integration - having the new team and existing teams meet in informal setting gives insight into culture and forms a relationship that can be leveraged when pulling resources or integrating a successful
business idea.
- Using experienced staff members from different departments as part of the new innovation team - having access to the experience and network of old staff members (usually from higher positions as well) will meant the
team works and integrates more smoothly with the rest of the organization

Word count: 85 (character count: 527)

In the paper “Two Routes to Resilience”, Gilbert, Eyring, and Foster (2012) argue that organizational transformations are two separate efforts that must happen simultaneously
Describe the two efforts and explain why they should happen simultaneously. (2.5 points)

- Reacting to market changes: recognizing the pitfalls of the current organization, relative to the rest of the market, and identifying and implementing methods to address that pitfall and change the organization
- Anticipating market changes: thinking ahead and trying to identify where the market is headed and how to get ahead. Anticiating and making changes before they become necessary.

Both should happen simultaneously as the market and competitive landscape and constantly changing. There is no way to constantly sustain a competitive advantage without doing both. Must always be reactive
otherwise you fall behind current competitors and also must anticipate the future otherwise you will not stand a chance against current competitors innovation efforts and also potential new entrants to the market.

Word count: 122 (character count: 811)

Score part a: 1 Correction criterion:

(max 2.5 points) The approach is called structural separation (or structural differentiation)
1 Correction criterion:
Structural separation means that the organization has separate units dedicated to exploration and exploitation activities
0.5 Correction criterion:
These activities are coordinated by senior management (i.e, at the corporate level)

Score part b: 1 Correction criterion:

(max 2 points) It is difficult to coordinate across units
0 Correction criterion:
The organization should manage contradictions at the senior management team

Score part c: 1 Correction criterion:

(max 3 points) . The answer should mention two of the four integration mechanisms (1 point per mechanism). For every mechanism that is mentioned, the answer should explain how it
5 mitigates the challenge (0.5 point per explanation:

• Senior team contingency rewards

Contingency rewards reconcile conflicts associated with allocating resources to differentiated exploratory and exploitative efforts.

• Senior team social integration

Social integration triggers alternative ways to reconciling conflicting goals across spatially distributed units

• Cross-functional interfaces
Cross-functional interfaces facilitate the generation and recombination of knowledge sources

• Connectedness
Connectedness provides a common base of understanding through which organizational members with disparate experience, knowledge, and backgrounds can trans-
fer and integrate new ideas

Score part d: 0 Correction criterion:

(max 2.5 points) . “Transformation A” adapts the core business to the realities of the disrupted marketplace.
5
0 Correction criterion:
. “Transformation B” creates a new, disruptive business that will become the company’s next source of growth (1)
5
0 Correction criterion:
. This dual approach allows leaders to save as much of the legacy business as they can while also granting the growth business the time it needs to establish itself.
2 What one transformation effort cannot accomplish alone, two together have a far better chance of achieving.
5

Given score: 6.25

Question version identifier: 8f7c7d18-cab7-a130-82fe-7c4dcbbea300

Question 5 
Answered on Dec 20, 2019, 10:59:39 AM Duration 19 min. and 23 sec. Score 5 of 10 points

In the fourth lecture Organizational Culture has been discussed.

What are the main functions of an organizational culture? Describe at least three of them. (3 points)

- Smooth flow of organization - already implied on how people are expected to behave
- Easy to integrate new members as they can mimick behaviors of existing ones
- Can recognize which risks to take that are within acceptable boundaries

Word count: 41 (character count: 236)

Name the four types of organizational culture of Handey (1985) and explain what each type entails. (4 points)

- Power culture - web where a lot of power sits in one individual

- Support culture - people are expected to help one another and share information

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2/3/2020 - Erasmus Universiteit Rotterdam - RemindoToets Afnameomgeving
- Reward culture - good behavior is rewarded and that tells people which behaviors they are expected to undertake and makes clear what the company's priorities are
- Achievement culture - work across teams towards a common goal where each team does their own work independently

Word count: 74 (character count: 426)

During the live case discussion of KPMG, Arjen van Ulden explained how KPMG tries to create a more entrepreneurial culture within their firm and that it can be a painful process. Which of the four types of organizational
cultures from Handey (1985) relates best to KPMG? Explain why and name an advantage and at least one disadvantage of this type in order to become more entrepreneurial. (3 points)

Achievement culture. At the end of the day, KPMG puts their clients first and the common goal is to address the clients needs and solve their problems together as a firm. That means that Arjen’s new branding team has
to come up with new, exciting branding ideas while the people in audit, for example, need to show how these ideas will fit into the balance sheet. The advantage is, if done well, there is a lot of potential resources and
developed skill sets across the company that the department can tap into and leverage across departments which improve efficiency and eliminate the need to do and learn everything from scratch.
However, there is a lot of friction involved for example work hours (branding gets in at 10 but work from home late while audit is 9-5 so there may be less channels of communication available) that inhibit the ability of
teams to coordinate. The different cultures also mean a lot of time is wasted in the small details that are not important in the long run eg coloring and formatting on slide presentations but are still a source of contention
between departments that need to be resolved.

Word count: 197 (character count: 1124)

Score part a: 1 Correction criterion:

(max 3 points) 1 point for every bullet point:
• Defines Boundaries
• Provides a sense of identity
• Reinforces the values of the organization
• Enhances social stability
• Serves as control mechanism for shaping behavior

Score part b: 3 Correction criterion:

(max 4 points) From the answer, it should be clear that they refer to:

- Power culture
-> where power is concentrated in a single source, with communication and authority radiating out from the centre. ‘Web’ structure.

- Role culture:
-> where delegated power is exercised through clearly defined roles and strict procedures and individuals are judged by how well they adhere to these. Authority is
based on position and job descriptions. For instance government structure

- Achievement culture:
-> where power is delegated to individuals and teams to perform given tasks and they are judged by how well they perform them. ‘Net’ structure, people work together
based on their information and expertise. Example is hospital where specialist need to work together on one patient.

- Support culture:
-> where the organization serves the individual and the individual thrives through their personal expertise. No formal management control and reporting lines. Consen-
sus model of management. Example non profit organisations

Score part c: 1 Correction criterion:

(max 3 points) One of the two choices 1 point and for advantage 1 point and for disadvantage also 1 point.

Role Culture: Relies on procedures where clear goals are being set and achieved. Arjen explained that within KPMG the roles and achievements KPI’s are clearly de-
fined.
+ Advantage: goals are usually met by the employees.
- Disadvantage: employees need to be given meaning to their work beyond their day to day functions. Also there is a non-collaborative nature. As Arjen explained very
clearly that based on how KPMG is structured they work in silo’s.

Achievement Culture:
+ Advantage: motivated people that work independently to better the group as a whole. Extremely ambitious and goal oriented.
- Disadvantage: competitiveness, and leadership becomes assertive

Given score: 5

Comment
On part a: Although you do not directly mention the bullets above, they are somewhat reflected in your answer

On part b: Mentioned the achievement culture, power culture and support culture

Question version identifier: b0c67441-7ac0-1d45-0928-d260e8d5bbdd

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