Chapter 10

A strategy of related diversification requires most firms to organize around geographical areas or product lines. This type of organizational growth leads to a(n) ______________ structure. A. divisional B. functional C. matrix D. international

A

A virtual organization may be most appropriate for firms A. whose strategies require merging technologies. B. whose product life cycles are just beginning. C. who have no need to get to market quickly with new offers. D. who have no need to meet competitive pressures.

A

A global start-up faces many management challenges including A. communication and coordination across time zones. B. pressure to perform internally all primary activities of the value chain. C. assuring financing from home country only. D. hiring only from home country.

A

A matrix organizational structure is characterized by a combination of the ______________ and _____________. A. functional structure; divisional structure B. simple structure; functional structure C. simple structure; divisional structure D. holding company structure; divisional structure

A

According to author, Jeffrey Pfeffer, which of the following is not an advantage of teams? A. Teams interact so closely and therefore coordination and integration becomes unnecessary. B. Teams substitute peer-based control for hierarchical control of work. C. Teams often develop more creative solutions, because they share. D. Teams permit the absorption of administrative tasks previously performed by specialists.

A

Coca-Cola, Ford Motor Company, H. J. Heinz, Nike, and Procter & Gamble are working together to develop plant-based plastics. Each company brings its own competency to the table. This collaboration is an example of a _____________ organization. A. virtual B. modular C. horizontal D. vertical

A

Functional structures are usually found in organizations where there A. is high volume production. B. are unrelated product lines or service offerings. C. is very little vertical integration. D. there exists a strong need to decentralize decision making.

A

If a firm outsources some parts of its value chain in order to reduce costs and increase quality and at the same time engages in multiple alliances to penetrate new markets, this is a example of a firm using a ______________ of organizational types. A. combination B. boundaryless consortium C. bounded consortium D. barrier free collection

A

Important advantages of a holding company structure include A. savings in personnel and overhead expenses associated with a small corporate office. B. a high level of awareness at the corporate office of issues facing individual divisions. C. a high level of control of division executives by executives at the corporate level. D. gaining synergistic benefits across businesses.

A

In large organizations, a strategy of diversification requires a need to reorganize around ______________ or _____________. A. product lines; geographic markets B. product lines; competition C. competitor lines; geographic markets D. distribution lines; competitor markets

A

In the ambidextrous firm, if managers direct their efforts primarily at _______, they are likely to miss out on promising business opportunities. A. alignment B. adaptability C. structure D. opportunities

A

Organizations generally tend to become internally focused when faced with ______________ and _____________. A. resource scarcity; declining performance B. internal pressures; improving performance C. resource abundance; declining performance D. external pressures; resource abundance

A

Strategic business unit (SBU) and holding company structures result from extensive A. diversification. B. vertical integration. C. international expansion. D. organizational flattening.

A

The appropriateness of the type of organizational structure depends upon the ___________ and _______ of growth. A. nature; magnitude B. definition; accessibility C. accessibility; nature D. nature; definition

A

Which of the following is a disadvantage of a functional type of organizational structure? A. Differences in functional orientation may impede communication and coordination. B. Use of managerial and technical talent is inefficient due to pooling of expertise in functional areas. C. Decision making is centralized at the top of the organization. D. Managers tend to be overly concerned with long-term strategies that minimize the importance of functional area strengths.

A

Which of the following is not a disadvantage of virtual structures? A. difficulty in individual and organizational knowledge sharing B. potential loss of operational control among partners C. loss of strategic control over emerging technology D. difficulty in determining where one company ends and another begins due to close interdependencies

A

Successful organizations create ______ boundaries among the _____ activities as well as between the organization and its external customers, suppliers, and alliance partners. A. impermeable; external B. impermeable; internal C. permeable; external D. permeable; internal

D

When an organization with a functional structure diversifies into related product-markets, it generally A. maintains its functional structure. B. develops a divisional structure. C. develops a matrix structure. D. develops a worldwide product-division structure.

B

When an organization with a simple structure increases its sales revenue and volume of outputs, it is most likely to develop a ______________ structure. A. divisional B. functional C. product-market D. geographic

B

A simple structure is characterized by A. high specialization and low centralization. B. low specialization and high centralization. C. low formality and low creativity. D. high formality and low centralization.

B

According to the study by O'Reilly and Tushman, effective ambidextrous structures had all of the following attributes except A. a clear and compelling vision. B. managerial efforts were highly focused on revenue enhancement. C. cross-fertilization among business units. D. established units were shielded from the distractions of launching new businesses.

B

As firms expand into foreign markets, they generally follow a pattern of change in structure that parallels the changes in their strategies. Which one of the following is not a major contingency that influences the structure they choose? A. the type of strategy that is driving the company foreign operations B. the research and development budget commitment C. product diversity D. the extent of the company dependence on foreign sales

B

Complicated working relationships, intense power struggles, and excessive reliance on group processes are disadvantages of which type of organizational structure? A. divisional B. matrix C. holding company D. functional

B

Generally speaking, discussions of the relationship between strategy and structure strongly imply that A. strategy follows structure. B. structure follows strategy. C. strategy can effectively be formulated without considering structural elements. D. structure typically has a very small influence on the strategy of a firm.

B

If an international firm has a global strategy and a relatively low level of product diversity, the best choice for its organizational structure is a(n) ______________ structure. A. worldwide functional B. worldwide product division C. worldwide matrix D. international division

B

In an ambidextrous firm, if too much focus is placed on _______ the firm with suffer low profitability in the short run. A. alignment B. adaptability C. structure D. opportunities

B

What is the name of the practice that many modular organization use to grow? A. operational effectiveness B. outsourcing C. strategic leveraging D. strategic enabling

B

Which of the following is an advantage of a divisional type of organizational structure? A. efficient use of managerial and technical talent B. an enhanced ability to respond quickly to changes in the external environment C. high degree of emphasis on long-term performance D. uniformity in image and quality across divisions

B

An organization such as ConAgra that has dozens of different divisions with similar products will probably have the greatest success with which form of organization structure? A. functional structure B. matrix structure C. strategic business unit structure D. holding company structure

C

As illustrated in the opening case for Chapter 10, Boeing lost a lot of control and therefore incurred high operating costs for its build out of the 787 Dreamliner, because it ____________ design and manufacturing. A. on-shored B. internalized C. outsourced D. internationalized

C

Effective ambidextrous organizations have alignment, which means that A. employees are rewarded according to both profit and sales growth. B. managers are focused on growth opportunities. C. there is a clear sense of how value is being created in the short-term and how activities are properly integrated and coordinated. D. divisional-level goals are consistent with overall corporate goals.

C

If an international firm has a multidomestic strategy and a relatively high level of product diversity, the best choice for its organizational structure is a(n) ______________ structure. A. worldwide functional B. worldwide product division C. worldwide matrix D. international division

C

Nike is a company that makes use of the concept of product expatriates. Product expatriates are A. managers from the home country sent abroad to oversee the marketing of company products. B. managers from suppliers who come to work at the company headquarters. C. managers of the company sent abroad to work at the plants of its suppliers. D. local nationals hired by the company in the countries from which it sources products.

C

Organizations are increasingly using teams for many reasons. The difference between a good team and an outstanding team has been found to be A. the combined technical skills of the members. B. similarities in the way team members solve problems. C. the way team members treat each other. D. similarities in the age and experience of team member.

C

Organizations that make it to the growth stage design strategies to A. reduce the tendency to increase operational scope. B. leave exiting product-market domains. C. increase the overall scope of operations. D. reduce the commitment to new product-market domains.

C

Strategic business unit (SBU) structures are best suited for corporations pursuing _____________, whereas holding company structures are best suited for companies with ______________ strategies. A. product-market diversification; international B. international diversification; product-market C. related diversification; unrelated diversification D. unrelated diversification; related diversification

C

Structures help to ensure that ____________ are used effectively in accomplishing the mission of the organization. A. strategies B. relationships C. resources D. boundaries

C

The relationship between strategy and structure can be best described as A. strategy determines structure but structure does not determine strategy. B. structure determines strategy but strategy does not determine structure. C. strategy and structure influence each other. D. a third force determines both strategy and structure.

C

The two vital ongoing activities necessary for creating boundaryless organizations that managers today must concern themselves with are A. financial returns and marketplace value. B. market share and shareholder value. C. type of structure, mechanisms, processes, and techniques for enhancing permeability. D. product marketability and capital structure.

C

Tools and techniques used to achieve effective coordination and integration of key activities in an organization include all of the following except A. horizontal organization structures. B. horizontal systems and processes. C. horizontal diversification. D. communications and information technologies.

C

What type of organization is defined as a central hub surrounded by networks of outside suppliers and specialists? A. matrix organization B. virtual organization C. modular organization D. barrier-free organization

C

Which of the following activities is not identified structure? A. managerial B. executive C. social responsibility D. administrative

C

Which of the following is an advantage of a functional type of organizational structure? A. Decentralized decision-making enhances an organization-wide perspective across functions. B. It facilitates the development of general management talent. C. Pooling of specialists enhances coordination and control. D. It is easy to establish uniform performance standards

C

Which of the following is considered to be an advantage of a matrix structure? A. the layering of matrices B. increased clarity in reporting relationships C. increased responsiveness to the market D. fewer power struggles and reduced conflict

C

Which of the following is not a boundaryless organizational design? A. virtual B. modular C. matrix D. barrier-free

C

Which of the following is not a disadvantage of the barrier-free form of organization? A. Lack of strong leadership can lead to coordination problems. B. Democratic process can be time-consuming and difficult to manage. C. Additional integration issues result in a slower response to market changes. D. If trust among employees is not sufficiently high, organizational performance may suffer.

C

Effective ambidextrous organizations maintain adaptability, which means that A. managers are focused on growth opportunities. B. there is a clear sense of how value is being created in the short-term and how activities are properly integrated and coordinated. C. divisional-goals are consistent with overall corporate goals. D. managers must remain proactive in expanding and/or modifying their product-market scope to anticipate and satisfy market conditions.

D

Organizational structure refers to the formalized patterns of interactions that link company ___________, ___________, and _____________. A. processes; mechanisms; techniques B. tasks; mechanisms; techniques C. processes; people; mechanisms D. tasks; technologies; people

D

The phrase that best defines a virtual organization is a(n) A. dot.com company. B. type of modular structure. C. organization that uses information technology to integrate different functions. D. continually evolving network of independent companies.

D

Virtual organizations ______________ whereas modular organizations _____________. A. are usually permanent; are usually temporary B. accept interdependent destinies; pursue collective strategies C. pursue collective strategies; forfeit strategic control D. give up part of their strategic control; retain full strategic control

D

What advantages does outsourcing not provide an organization? A. accessing best in class goods and services B. enabling rapid expansion with relatively low capital investment C. focusing scarce resources on core competencies D. improved buyer positioning

D

Which of the following is not a disadvantage of a divisional type of organizational structure? A. It can be very expensive compared to a functional organizational structure. B. There is a strong tendency for divisions to focus on short-term performance. C. There can be dysfunctional competition among divisions. D. There is separation of strategic and operating control.

D

Which of the following is not a primary factor that a large firm with international operations should consider when choosing the appropriate structure for its organization? A. the extent of international expansion B. the type of strategy (global, multidomestic, or transnational) C. the degree of product diversity D. the degree of market diversity

D

Which of the following is not a strategic risk of outsourcing? A. loss of critical skills B. loss of cross-functional skills C. loss of control over a supplier D. loss of non-vital functions

D

Which of the following is not an advantage of a strategic business unit (SBU) type of organizational structure? A. Divisions with similar products, markets, or technologies are formed into homogeneous groups that can achieve synergies. B. Divisional executives can respond quickly to market changes and opportunities. C. Planning and control by the corporate office is more manageable. D. The corporate office is more removed from the individual divisions.

D

Which of the following statements about simple organizational structures is false? A. Small firms with a narrow product-market scope will adopt such a structure. B. Decision making authority is highly centralized. C. There is little specialization of tasks. D. Creativity and individualism are rare.

D

Which one of the following is not a primary types of organizational structures used to manage the international operations of a company? A. international division B. worldwide matrix C. geographic-area division D. home country product division

D