Chapter 7

10. Which tactics are used more initially and which are used more as follow-
up tactics?

10. Most initial influence attempts involve either a simple request or a relatively
weak form of rational persuasion. These tactics are easy to use and entail little in
the way of agent costs. However, if some target resistance is anticipated, then the
agent is likely to use a stronger form of rational persuasion, and "soft" tactics such
as personal appeals, ingratiation, consultation, collaboration, and inspirational
appeals. In the face of continued resistance by a target, the agent will either
escalate to "harder" tactics or
abandon the effort if the request does not justify the risks entailed by escalation.
Pressure, exchange, and coalitions are likely to be saved for follow-up influence
attempts, because they involve the greatest costs and risks.

11. Which influence tactics are most likely to result in target commitment?

The most effective tactics for influencing target commitment to carry out a request
of support a proposal (sometimes called "core tactics") are rational persuasion,
consultation, collaboration and inspirational appeals.
Rational Persuasion: The agent uses logical arguments and factual evidence to
show a proposal or request is feasible and relevant for attaining important task
objectives.
Consultation: The agent encourages the target to suggest improvements in a
proposal or to help plan an activity or change for which the target person's support
and assistance are desired.
Collaboration: The agent offers to provide relevant resources and assistance if
the target will carry out a request or approve a proposed change.
Inspirational Appeals: The agent makes an appeal to values and ideals or seeks
to arouse the target person's emotions to gain commitment for a request or
proposal.
Chapter 8

4. Is it possible to develop different dyadic relationships with individual

subordinates and still treat everyone fairly?
The theory would he improved by a clear description of the way a leader's different
dyadic relationships affect each other and overall group performance. Some
differentiation is likely to benefit group performance, especially if it is perceived by
members as fair and appropriate to facilitate team performance.
However, as differentiation of dyadic relationships increases, at some point it
probably begins to create feelings of resentment among the low-exchange
members.
The minimal level of compliance expected of them may fail to occur if the leader's
'favorites' appear to be getting more benefits than they deserve. The negative
effects of extreme differentiation will be greater when the work unit 15 an
interacting team, because hostility among members undermines necessary
cooperation. The challenge for a leader is to develop differentiated relationships
with some subordinates to facilitate achievement of the team’s mission, while
maintaining a relationship of mutual trust, respect, and loyalty with the other
subordinates. It is not necessary to treat all subordinates exactly the same, but
each person should perceive that he or she is an important and respected member
of the team rather than a "second-class citizen." Not every subordinate may desire
more responsibility, but each person should perceive an equal opportunity based
on competence rather than arbitrary favoritism.

5. Use attribution theory to explain how leaders interpret the reason for poor
performance by a subordinate.
Green and Mitchell (1979) described the reaction of a manager to poor
performance as a two stage process. In the first stage the manager tries to
determine the cause of the poor performance; in the second stage the manager
tries to select the appropriate response to correct the problem.
Managers attribute the major cause of poor performance either to something
internal to the subordinate (e.g., lack of effort or ability) or to external problems
beyond the subordinate's control (e.g., the task had inherent obstacles, resources
were inadequate, information was insufficient, other people failed to provide
necessary support, or it was just plain bad luck).
An external attribution is more likely when 1) the subordinate has no prior history of
poor performance on similar tasks; (2) the subordinate performs other tasks
effectively; (3) the subordinate is doing as well as other people who are in a similar
situation; (4) the effects of failures or mistakes are not serious or harmful; (5) the
manager is dependent on the subordinate for his or her own success; (6) the
subordinate is perceived to have other redeeming qualities ( popularity, leadership
skills); (7) the subordinate has offered excuses or an apology; or (8) evidence
indicates external causes. In addition, managers with prior experience doing the
same kind of work as the subordinate are more likely to make external attributions
than managers without such experience, perhaps because they know more about
the external factors that can affect performance. Manager trait, such as internal
locus of control orientation, can also influence attributions.
The type of attribution made by a manager influences the response to the problem.
When an external attribution is made, the manager is more likely to respond by
trying to change the situation, such as providing more resources, providing
assistance in removing obstacles, providing better information, changing the task
to reduce inherent difficulties, or in the case of bad luck, by showing sympathy or
doing nothing. When an internal attribution is made and the manager determines
that the problem is insufficient ability, the likely response is to provide detailed
instruction, monitor the subordinate's work more closely, provide coaching when
needed, set easier goals or deadlines) or assign the subordinate to an easier job. If
the problem is perceived to be lack of subordinate effort and responsibility, then the
likely reaction is to give directive or nondirective counseling, give a warning or
reprimand, punish the subordinate, monitor subsequent behavior more closely, or
find new incentives.
6. How can subordinates influence a leader's perceptions about them?
Subordinates can influence leader’s perception about them by being competent
and dependable, and if their values and attitudes are similar to those of the leader.

7. What are some guidelines for corrective feedback?

Corrective feedback should be provided soon after the problem is noticed rather
than waiting until a later time when the person may not remember the incident.
Deal immediately with improper behavior that you observe yourself, and handle
other performance problems (complaints about a subordinate, substandard quality
or productivity) as soon as you conduct a preliminary investigation. Some
managers save up criticism for the annual appraisal meeting or scheduled
progress review meetings. This practice is likely to be ineffective. By delaying
feedback, you lose the opportunity to deal with the problem immediately before it
becomes worse. Moreover, by not responding to inappropriate or ineffective
behavior, the wrong message may be sent, namely that the behavior is acceptable
or not of any consequence. Finally, a person is likely to be more defensive after
hearing a barrage of criticism at the same time.

Chapter 9

1. Briefly describe the attribution theory of charismatic leadership.

Attributions of charisma are the result of an interactive process between leader, followers
and the situation. Charismatic leaders arouse enthusiasm and commitment in followers
hy articulating a compelling vision .and increasing follower confidence ahout
achieving it. Attribution of charisma to the leader is more likely if the vision and strategy
for attaining it are innovative, the leader t~lkes personal risks to promote it. and the
strategy appears to be succeeding.
2. Briefly describe the self-concept theory of charismatic leadership.
The theory identifies how charismatic leaders behave, their traits and skills,
And the conditions in which they' are most likely to emerge. One limitation of the initial
theory was a ambiguity about the influence processes.
The following assumptions were made about human motivation:
1) behavior is expressive of a person's feelings, values, and self-concept as well as
being pragmatic and goal oriented; 2) a person's self-concept is composed of a hierarchy
of social identities and values; 3) people are inuinsically motivated to enhance
and defend their self-esteem and self-worth; and 4) people are intrinsicaly motivated
to maintain consistency among the various components of their self-concept, and between
their self-concept and behavior.

3. Briefly descrihe the psychoanalytic and social contagion theories.

psychoanalytic theorists attempt to explain the unusual and seemingly irrational influence
of some charismatic leaders who are idolized as a superhuman hero or worshiped as a
,Spiritual figure. The intense personal identification of followers with such leaders is
explained in terms ofpsychodynamic processes such as regression, transference, and
projection. Regression
involves a return to feelings and behaviors that were typical of a younger age.
Transference occurs when feelings toward an important figure from the past (e.g., a
parent) are shifted to someone in the present. Projection involves a process of attributing
undesirable feelings and motives to someone else, thereby shifting the blame for
things about which one feels guilty.
According to one psychoanalitic explanation, followers suffering from fear, guilt,
or alienation may experience a feeling of euphork empowennent and transcendence
by submerging their identity in that of a seemingly superhuman leader.

Social contagion used to explain how followers influence each other is social contagion,
which involves the spontaneous spread of emotional and behavioral reactions among a
group of people. people have a positive image of themselves as emotionally
involved in a righteous cause for which they are willing to make self-sacrifices and
exert extra effort. This social identity is usually inhibited by other, more central social
identities, hy social norms about appropriate behavior, and by the desire for material
benefits. Ho\vever, these people are waiting for a leader and a cause to activate the
heroic social identity
4. What influence processes are emphasized by each charismatic theory?
The attribution theory of charismatic leadership, when strong personal identification
occurs, followers will imitate the leader's behavior,carry out the leader's requests, and make
an extra effort to please the leader.
The self-concept theory does not emphasize personal identification.More important as
sources of leader influence over followers are social identification, internalization, and
augmentation of individual and collective selfefficacy,
5. What behaviors are generally associated with charismatic leadership?
Attributions of charisma are the result of an interactive process between leader, followers
and the situation. Charismatic leaders arouse enthusias and commitment in followers
by articulating a compelling vision and increasing follower confidence about
achieving it.Attribution of charisma to the leader is more likely if the vision and strategy
for attaining it are innovative, the leader takes personal risks to promote it and the
strategy appears to be succeeding. Other relevant behaviors have also been identified,
but they vary somewhat across the different theolies.
6. What is routinization of charisma, and how is it accomplished?
Charisma is a transitory phenomenon when it is dependent on personal identification
with an individual leader who is perceived to be extraordinary. When the
leader dies, a succession crisi is likely. Many organizations founded by an
autocratic charismatic leder fail to survive this succession crisis
Charismatic leaders can do several things in an effort to perpetuate their influence on the
organization atier they depart
One approach is to transfer charisma to a designated successor through rites and
ceremonies.
A second approach is to create an administrative structure that will continue to
implement the leader's vision with rational-legal authority
This routinization of charisma" can reduce the effectiveness of the organization.
A third approach to perpetuate the leader's vision is to embed it in the culture
of the organization by influencing followers to internalize it and empowering them
to implement it.

Chapter 9

1. Briefly describe the attribution theory of charismatic leadership.

Attributions of charisma are the result of an interactive process between leader,
followers
and the situation. Charismatic leaders arouse enthusiasm and commitment in
followers
hy articulating a compelling vision .and increasing follower confidence ahout
achieving it. Attribution of charisma to the leader is more likely if the vision and
strategy
for attaining it are innovative, the leader t~lkes personal risks to promote it. and the
strategy appears to be succeeding.
2. Briefly describe the self-concept theory of charismatic leadership.
The theory identifies how charismatic leaders behave, their traits and skills,
And the conditions in which they' are most likely to emerge. One limitation of the
initial
theory was a ambiguity about the influence processes.
The following assumptions were made about human motivation:
1) behavior is expressive of a person's feelings, values, and self-concept as well
as
being pragmatic and goal oriented; 2) a person's self-concept is composed of a
hierarchy
of social identities and values; 3) people are inuinsically motivated to enhance
and defend their self-esteem and self-worth; and 4) people are intrinsicaly
motivated
to maintain consistency among the various components of their self-concept, and
between
their self-concept and behavior.

3. Briefly descrihe the psychoanalytic and social contagion theories.

psychoanalytic theorists attempt to explain the unusual and seemingly irrational
influence of some charismatic leaders who are idolized as a superhuman hero or
worshiped as a ,Spiritual figure. The intense personal identification of followers
with such leaders is explained in terms ofpsychodynamic processes such as
regression, transference, and projection. Regression
involves a return to feelings and behaviors that were typical of a younger age.
Transference occurs when feelings toward an important figure from the past (e.g.,
a
parent) are shifted to someone in the present. Projection involves a process of
attributing
undesirable feelings and motives to someone else, thereby shifting the blame for
things about which one feels guilty.
According to one psychoanalitic explanation, followers suffering from fear, guilt,
or alienation may experience a feeling of euphork empowennent and
transcendence
by submerging their identity in that of a seemingly superhuman leader.

Social contagion used to explain how followers influence each other is social
contagion,
which involves the spontaneous spread of emotional and behavioral reactions
among a group of people. people have a positive image of themselves as
emotionally
involved in a righteous cause for which they are willing to make self-sacrifices and
exert extra effort. This social identity is usually inhibited by other, more central
social
identities, hy social norms about appropriate behavior, and by the desire for
material
benefits. Ho\vever, these people are waiting for a leader and a cause to activate
the
heroic social identity
4. What influence processes are emphasized by each charismatic theory?
The attribution theory of charismatic leadership, when strong personal identification
occurs, followers will imitate the leader's behavior,carry out the leader's requests,
and make an extra effort to please the leader.
The self-concept theory does not emphasize personal identification.More important
as sources of leader influence over followers are social identification,
internalization, and augmentation of individual and collective selfefficacy,
5. What behaviors are generally associated with charismatic leadership?
Attributions of charisma are the result of an interactive process between leader,
followers
and the situation. Charismatic leaders arouse enthusias and commitment in
followers
by articulating a compelling vision and increasing follower confidence about
achieving it.Attribution of charisma to the leader is more likely if the vision and
strategy
for attaining it are innovative, the leader takes personal risks to promote it and the
strategy appears to be succeeding. Other relevant behaviors have also been
identified,
but they vary somewhat across the different theolies.

6. What is routinization of charisma, and how is it accomplished?

Charisma is a transitory phenomenon when it is dependent on personal
identification
with an individual leader who is perceived to be extraordinary. When the
leader dies, a succession crisi is likely. Many organizations founded by an
autocratic charismatic leder fail to survive this succession crisis
Charismatic leaders can do several things in an effort to perpetuate their influence
on the organization atier they depart
One approach is to transfer charisma to a designated successor through rites and
ceremonies.
A second approach is to create an administrative structure that will continue to
implement the leader's vision with rational-legal authority
This routinization of charisma" can reduce the effectiveness of the organization.
A third approach to perpetuate the leader's vision is to embed it in the culture
of the organization by influencing followers to internalize it and empowering them
to implement it.

Chapter 10
7. What are some reasons why efforts to change organizations often fail?
One of the most important and difficult leadership responsibilities is to guide and
facilitate the process of making a major change in an organization. People tend to
resist major change for many reasons, including distrust, doubts about the need for
change, doubts about the feasibility of change, doubts that the benefits from
change would justify the costs, fear of economic loss, fear of losing status and
power, fear of personal failure, perception the change is inconsistent with values,
and resentment about interference from above. Resistance should be viewed as a
normal defensive response, not as a character weakness or a sign of ignorance.

11. How can leaders increase collective learning and innovation?

Leaders can do many things to increase collective learning and innovation, and
here are some of the guidelines that help accomplish such goals:
1. Encourage appreciation for flexibility and innovation.
2. Encourage and facilitate learning by individuals and teams.
3. Help people improve their mental models.
4. Leverage learning from surprises and failures.
5. Encourage and facilitate sharing of knowledge and ideas.
6. Set innovation goals.
7. Reward entrepreneurial behavior.

Chapter 11

1. Why is it so difficult to evaluate ethics and morality for individual

leaders?

Despite the growing interest in ethical leadership, there is considerable

disagreement about the appropriate way to define and assess it. It is useful to
make a distinction between the ethics of individual leader and the ethics of specific
types of leadership behavior, and both types of ethics are difficult to evaluate.
Several criteria are relevant for judging individual leaders, including the person's
values, stage of moral development, conscious intentions, freedom of choice, use
of ethical and unethical behavior, and types of influence used. Famous leaders
usually have a mix of strengths and weaknesses with regard to these criteria. One
difficulty in evaluating the morality of individual leaders is the subjectivity inherent
in determining which criteria to use and their relative importance. The final
evaluation can be influenced as much by the qualities of the judge as by the
qualities of the leader. Judgments about the ethics of a particular decision or action
usually take into account the purpose (ends), the extent to which behavior is
consistent with moral standards (means), and the consequences for self and
others (outcomes). The three criteria are usually considered in relation to each
other, and a common issue is the extent to which the ends justify the means.
(Influencing follower commitment and optimism are central aspects of most
theories of effective leadership. Leaders are usually expected to influence follower
commitment to an existing task or a new activity. However, this influence is also the
source of ethical concerns. The problem for evaluating ethical leadership is to
determine when such influence is proper. It is easier to evaluate ethical leadership
when the interests of the leader, the followers, and the organization are congruent
and can be attained by actions that do not involve much risk or cost to any of the
parties. However, in many situations the influence process may involve (1) creating
enthusiasm for a risky strategy or project, (2) inducing followers to change their
underlying heliefs and values, and (3) influencing decisions that will benefit some
people at the expense of others. Each type of influence involves some ethical
dilemmas.
The criteria for evaluating ethical leadership include leader values, intentions, and
the extent to which leader behavior is morally justifiable.)

2. What are some examples of ethical and unethical leadership?

Conceptions of ethical leadership include nurturing followers, empowering them,

and promoting social justice. Ethical leadership includes efforts to encourage
ethical behavior and efforts to stop unethical practices in the organization. Ethical
leaders seek to build mutual trust and respect among diverse followers and find
integrative solutions to conflicts among stakeholders with competing interests.
Such leaders do not foster distrust or play favorites to gain more power or achieve
personal objectives. Determinants of ethical behavior by a leader include
situational influences and aspects of leader personality such as level of cognitive
moral development.
Examples of behavior that is usually considered unethical in Western nations
indude falsifying information, stealing assets for personal use, blaming ofhers for
one's own mistakes, provoking unnecessary hostility and distrust among ofhers,
selling secrets to competitors, showing favoritism in return for a bribe, and
engaging in reckless behaviors iliat are likely to injure others. Judgments about
ethical leadership vary somewhat across cultures, but researchers find that some
types of leader behavior (e.g. exploiting followers) are considered improper
regardless of national culture.
Most scholars consider integrity to be an important aspect of ethical leadership, but
the appropriate definition is still a subject of debate. The most basic definition
emphasizes honesty and consistency between a person's espoused values and
behavior. Some examples of behaviors usually regarded as morally justifiable
include following: the same rules and standards applied to others, being honest
and candid when providing infofmation or answering questions, keeping promises
and commitments, and acknowledging responsibility for mistakes while also
seeking to correct them.
Unethical, abusive leadership is more likely for a person who has low
concientiousness, low emotional maturity, high neuroticism, high narcissism, an
external locus of control orientation, and a personalized power orientation. This
type of leader is likely to perceive that other people are untrustworthy and to view
themas objects to be manipulated for personal gain. Power is used to exploit
others and achieve personal objectives, rather than to benefit others and achieve
organizational objectives.
Most people would agree that it is unethical to deliberately manipulate followers to
do something contrary to their self-interest by making false promises or deceiving
them about likely outcomes. One proposed standard for ethical leadership in the
case of risky ventures is for the leader to fully inform followers about the likely
costs and benefits and ask followers to make a conscious decision about'whether
the effort is worthwhile.

3. Can unethical behavior occur for a leader who has proper values and
intentions?

Leader personality and cognitive moral development interact with aspects of the
situation in the determination of ethical and unethical behavior. That is, ethical
behaviour can be explained better by consideration of both the individual leader
and the situation than by either variable alone.
A leader may have ulterior motives for using behaviors that appear morally
justifiable. An example is to use kindness to gain the trust of people who will later
be exploited. For this reason, it is necessary to consider a leader's intentions and
values as well as behaviors when evaluating ethical leadership. To be ethical, the
leader must intend no harm and respect the rights of all affected parties.
Emotionally mature leaders with a high level of cognitive moral development are
more likely to resist the temptation to use their power to exploit others, and they
are less likely to use unethical practices to accomplish objectives.

Chapter 12

1. What factors determine the performance of a team?

Factors that determine the team performance are:
 Commitment to Shared Objectives

 Member Skills and Role Clarity

 Internal Organization and Coordination

 External Coordination

 Resources and Political Support

 Mutual Trust and Cooperation

 Collective Efficacy and Potency

2. What leadership processes are important for cross-functional teams?

Essential leadership processes for cross-functional teams are: idea generation,

idea structuring, and idea promotion.

3. Why is leadership more difficult in cross-functional teams than in

traditional functional teams?
To be leader in cross-functional team is more difficult because manager is
responsible for other representatives of functional subunits in the organization and
the member of that subunit involved in a project. Leader in cross-functional team
need to have technical expertise, project management skills, cognitive skills,
interpersonal skills, and political skills. While to be leader in the traditional
functional team is much easier, because leader is responsible for one group of the
people, although other group members may assist in performing specific
leadership functions.
4. What leadership roles and processes are important for self-managed
teams?
-First we need to make difference between internal and external leadership roles.
In internal leadership the most important responsibilities are shared by group
members, not concentrated in the team leader. The primary role of internal leader
is to coordinate and facilitate the process of making and implementing team
decisions (conduct meetings, prepare work schedules, and administrative
paperwork).
The role of an external leader involves managerial responsibilities not delegated to
the team. They can be middle managers, special facilitators or some of the
previous first-line supervisors. One important role of external leaders is to serve as
coach, facilitator and consultant to the team. Another important role is to obtain
necessary information, resources and political support from the organization.

5. Under what conditions are self-managed teams most likely to be

successful?
-Firstly, as the team continues to develop, the external leader should communicate
clear expectations about new responsibilities of members, but also to clearly
communicate new objectives and changing priorities.
Secondly, he has to continue to serve as a champion and advocate for the team,
helping it to obtain necessary resources and political support from the organization.
Finally, it is often necessary for the external leader to assist the team in dealing
with unusual, disruptive events.

6. Explain how after-activity reviews and dialogue sessions can improve

team learning.
Read pages 371-373

Chapter 13

1. What are the major performance determinants for organization?

There are three major types of performance determinants and the conditions that
increase their importance for organization:
 Adaptation to the Environment.
Adaptation is enhanced by accurate interpretation of information about the
environment; collective learning by members (understanding of processes and
causal relationships); effective knowledge management (retention and diffusion of
new knowledge within the organization); flexibility of work processes (capacity to
change them quickly as needed); innovations in products, services, or processes;
and availability of discretionary resources (to support new initiatives and crisis
management).
 Efficiency and Process Reliability.
Efficiency is the use of people and resources to carry out essential operations in a
way that minimizes costs and avoids wasted effort and resources.
Process reliability means avoiding unnecessary delays, errors, quality defects, or
accidents. It is an important component of efficiency when defective products or
unreliable processes increase costs. Examples include employee theft or misuse
of resources, expenses for correcting or replacing defective products or inadequate
services, expenses for repairing or replacing damaged equipment, and lawsuits by
customers or employees who are injured by errors, accidents, or exposure to
harmful substances.
 Human Resources and Relations.
The term human capital is sometimes lIsed to describe the quality of an
organization's human resources, which include the relevant skills and experience
of members.
Human resources and relations are more important when the work is complex and
difficult to learn, new members require extensive training, successful performance
requires a high level of skill and motivation, and it is difficult to recruit and train
competent replacements for people who leave (e.g., hospitals, consulting firms,
legal fIrms, advertising agencies, research universities).

2. How can leaders influence each type of performance determinant?

Leaders can enhance the performance determinants with a combination of

methods, including (1) leadership behaviors; (2) changes in programs, systems,
and structure; and (3) competitive strategy.
 Leadership Behaviors

Most forms of direct leadership behavior can be classified into three general types
or metacategories that are differentiated by their primary objective.
- The task-oriented behaviors are used primarily to improve efficiency and
process reliability.
- The change-oriented behaviors are used primarily to improve adaptation to
the external environment.
- The relation-oriented behaviors are used primarily to improve human
relations and human resources.
  Programs, Systems, and Structure

Another way for leaders to influence the performance determinants is by

implementing or modifying formal programs, management systems, and aspects of
formal structure, this type of influence is sometimes called indirect leadership,
because no direct interaction with followers is necessary to influence their attitudes
and behavior.
 Decision about Competitive Strategy

Top executives usually have primary responsibility for making decisions about
competitive strategy, and these decisions are an especially important source of
influence on an organization's performance. Competitive strategy includes
decisions about the types of products or services to offer, the basis for appealing to
potential customers (e.g., price, quality, customer service, uniqueness, patriotism),
and the methods used to influence potential customers or clients (e.g., advertising,
discounts, promotions).

3. What conditions limit the discrecion of the CEO?

We have two types of constraints that influence the discrecion of the CEO:
-internal constraints, and
-external constraints.
 Internal constraints

The CEO's discretion can be limited by a variety of internal organizational factors.

One type of constraint involves powerful inside forces or coalitions in the
organization. There is less discretion when the CEO must operate in the shadow of
the company founder, satisfy a dominant owner (e.g., the organization is a family-
owned firm or the subsidiary of another firm), or answer to a strong board of
directors with rigid ideas about the appropriate way to do things. Power and
discretion are greater when the CEO is a major owner or shareholder of the firm or
when the board of directors is easily influenced ro support the CEO.
Another type of internal constraint is a strong organization culture that is resistant
to change. Large organizations with a strong bureaucracy and standardized ways
of doing things have an inertia that is difficult to overcome.
 External constrains

External constraints on the discretion of a CEO include the nature of the

organization's primary products and services and the type of markets in which the
organization operates. Managerial discretion is greater if the organization is in a
growth industry that has rapidly increasing demand rather than flat or declining
demand, if the organization's products or services can be differentiated from those
of competitors and if the organization dominates its markets and faces little or no
direct competition (e.g., it is a monopoly or has a dominant share of the market).
Discretion is also constrained by powerful external stakeholders who can dictate
conditions, as when a few major clients account for most of the company's sales,
or when the company is dependent on a single source of key materials. Even when
the organization is a monopoly, discretion in key areas such as pricing, technology,
and product changes may be severely limited by government regulation.