Changes in strategy often entail budget reallocations because
A) more money will be needed to fund the new strategy initiatives.
B) the policy revisions and compensation incentives that tend to accompany strategy changes typically require different levels of funding.
C) the value chain activities and organizational units critical to executing the old strategy are not necessarily as critical in executing the new strategy, thus making it desirable to reduce budget allocations to areas having a lesser strategy-executing role and to increase budget allocations for those value chain activities having a bigger strategy-executing role.
D) substantial budget revisions are usually needed to empower employees to carry out the new strategy elements.
E) adopting best practices and pushing for continuous improvement tends to reduce costs and reduce overall resource requirements.
Answer: C