Question

Dream Slope Inc. is a leader in producing winter sports equipment, including skis and skates. Recently, the firm decided to expand into the bobsled market and acquired Sleek Phantom Inc. This company produced bobsleds, but its sales had slowed. The managers of Dream Slope convinced themselves that they were able to manage the business of Sleek Phantom more effectively even though they had no experience in the bobsled market. However, this move backfired and the sale of Sleek Phantom's bobsleds plummeted. Which of the following terms is often used to describe this scenario?
A.
managerial disadvantage

B.
managerial hubris

C.
managerial sympathy

D.
managerial empathy

Answer 1

Answer:

B. managerial hubris

Explanation:

Managerial hubris is the overconfident belief in managers that they can manage a particular business better than its current manager. This is usually an unrealistic belief which most times ends in losses as the overconfident manager is not skilled in that particular area and lacks the level of experience needed to make the new venture flourish as it should.

This was the predicament the managers at Dream Slope found themselves in after they convinced themselves they were better suited to manage Sleek Phantom. They were inexperienced in the businesses of Sleek Phantom and their foolish move soon backfired as sales dropped. This is known as managerial hubris.