Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which component of an organization is responsible for strategy?

1. Technostructure

2. Operation core

3. Strategic apex

4. Support staff

The correct answer is: Strategic apex

The strategic apex is the component of an organization that is primarily responsible for formulating and overseeing the overall strategy. This group typically comprises top management, including the CEO and other executive leaders, who are tasked with ensuring that the organization effectively meets its goals and objectives. They engage in long-term planning, make critical decisions that shape the direction of the organization, and allocate resources to achieve strategic aims. Their focus is on the bigger picture of organizational performance, such as market positioning, competitive advantage, and overall vision. The strategic apex also interacts with the various components of the organization to ensure alignment between strategy and operational activities. This governing body must consider external market conditions, internal capabilities, and stakeholder interests when crafting effective strategies. In contrast, other components like the technostructure, operating core, and support staff contribute in different ways but do not primarily hold strategy formulation and oversight responsibilities. The technostructure typically focuses on designing and implementing processes and systems, the operating core concerns itself with day-to-day operations, and the support staff provides necessary assistance to the other components without being involved in strategic decision-making.