Chap 11

Because organizational culture encompasses interactions among employees in all levels of the firm as well as the firm's relationships with its customers and suppliers, it is said to be

socially complex

A system that allows managers to specify goals, measure progress, and provide performance feedback by ensuring that the incentives of shareholders and employees are aligned is called a ______ system.

strategic control-and-reward

What is the goal of a differentiation strategy?

to create a competitive advantage by offering products or services at a higher perceived value, while keeping costs under control

What is the goal of organizational design?

to enable managers to translate their chosen strategy into a realized one

Big companies, such as Apple and Comcast, tend to have

a higher degree of specialization than smaller companies

The organizational structure at Gore, in which everyone is encouraged to speak to anyone they wish to within the organization, is called a(n) ______ organizational form.

boundaryless

The extent to which the ability to make decisions rests with the people at the top of a firm is referred to as

centralization

Mechanistic organizations tend to have

codified operating procedures

A firm would use input controls if it wanted to

define and direct employee behavior through a set of explicit, codified rules and standard operating procedures

Companies pursuing business-level strategies like cost leadership, differentiation, and integration should organize using a _____ structure.

functional

The inability to effectively deal with higher levels of ______, a common result of growth, is a weakness of the functional structure.

diversification

Which of the following terms describes applying current knowledge to enhance firm performance in the short term?

exploitation

Which of the following terms describes searching for new knowledge that may enhance a firm's future performance?

exploration

Motivation that is driven by external factors, such as rewards or punishments, is called ______ motivation.

extrinsic

Which of the following is typical of an organic organization?

flexible division of labor

The Foamy Mug, a chain of coffee shops, ensures consistent quality and service in each of its cafés by using policy and procedure manuals that explicitly describe employee tasks. The Foamy Mug is characterized by a high degree of

formalization

The organizational structure element that deals with the degree to which employees are guided by specific, codified rules and processes is known as

formalization

The organizational element that determines the organization's formal, position-based reporting lines is known as

hierarchy

Which of the following is typical of mechanistic organizations?

high division of labor

When the span of control within an organization is wide, one manager supervises

many employees

When firms tie employee compensation and rewards to predetermined goals, such as a specific sales target, but do not specify the means to those results, they are using ______ controls.

output

Which of the following tends to directly improve employee conformity and performance?

peer control

If a company fails to change its culture as the firm and environment change, the company's culture can turn into a core

rigidity

Ravi works for a small company. The company owner makes all strategic decisions and manages the day-to-day operations. Ravi's company has a _____ structure.

simple

Employees learn about their firm's culture through

socialization

Which of the following structures is divided into several distinct business units, each of which has its own profit-and-loss center?

the multi-divisional structure

What is the goal of an internal capital market?

to allocate capital more efficiently than would happen in an external capital market

Which of the following determines the allocation of resources and the organization and operations of workers?

a firm's organizational structure

Which type of structure uses domain expertise to separate employees into specific areas based on their purpose, such as sales and human resources?

a functional structure

The organizational structure at Gore may be described as

informal and decentralized

What must a firm that pursues a cost-leadership strategy do in order to nurture and constantly upgrade core competencies in manufacturing and logistics?

use a functional structure that has mechanistic organizational elements

Which of the following are frequently associated with organic organizations?

greater employee creativity high levels of employee satisfaction fast decision making

Disadvantages of the ______ structure include organizational complexity, increased administrative costs, slow decision making, and difficulty in implementation.

matrix

If there are several levels of management between the lowest employee and the CEO, the firm has a ______ structure.

tall

Firms that pursue ______ strategy tend to use a global matrix structure.

transnational

Firms that follow a single-business or dominant-business strategy at the corporate level generally employ a ______ structure.

functional

When a firm covers a limited geographic area and is narrowly focused in terms of product/service offerings, a ______ structure is recommended.

functional

Groups that are highly cohesive and lack diversity are at risk of falling victim to

groupthink

A top-down strategic plan generally takes place in which type of organization?

highly centralized

Which of the following is a top-down approach to managing innovation that involves implementing structures and systems that foster creativity?

induced innovation

Which are examples of strategic control-and-reward systems?

input controls organizational culture output controls

When corporate headquarters efficiently allocates capital to individual strategic business units, it acts as a(n)

internal capital market

What is needed to motivate innovations through autonomous actions and increase the possibility of their success?

internal champions who are willing to support promising projects

A characteristic of a matrix organizational structure is that it

is difficult to implement

Which of the following are characteristics of simple organizational structures?

low formalization flat hierarchies single leader makes all important decisions

A firm that is organized according to SBUs but also is decentralized in that different geographic locations are fully functional is likely organized in the ______ structure.

matrix

Which of the following structures is a combination of the multidivisional structure and the functional structure?

matrix structure

Which of the following is true of an M-form?

Each division operates independently.

Why does management frequently fail at strategy implementation?

Managers cannot make needed adjustments because of their effect on the firm's resource allocation and power distribution.

Which two of the following accurately describe mechanistic organizations?

They are highly specialized. They have a tall hierarchy.

Which of the following are true of cross-functional teams?

They work on a specific product or project. They are meant to facilitate collaboration between departments.

The functional structure results in difficulty communicating across departments.

True. A disadvantage of a functional structure is that it lacks effective communication channels across departments.

When a firm's organizational structure is tall, the span of control is

narrow

The structure, processes, and procedures of an organization are designed, put into place, reviewed, and reworked through a process known as

organizational design

Motivation that is driven by the employee's interest and the meaning of the work itself is called ______ motivation.

intrinsic

In order for firms to achieve superior performance,

structure must follow strategy

Which two of the following accurately describe organic organizations?

- a flat organizational structure - a low degree of specialization

When causal relationships among values, norms, artifacts, and the firm's performance are hard to establish, making it difficult to imitate a firm's culture, the culture is characterized by

causal ambiguity

What is the best way for organizations to overcome the lack of collaboration across departments in a functional structure?

set up cross-functional teams

The functional areas present in a functional structure frequently correspond to which of the following?

stages in the value chain