Chapter 14: Organization Structure and Design
A firm using unit production and making custom products would typically have a _________ structure with a smaller managerial span of control. a. flatter b. larger c. taller d. complex e. None of these are correct.
Flatter
The organizational ________ is defined as the system of task, reporting, and authority relationships within which the work of the organization is done. a. goal system b. management c. structure d. community e. matrix
Structure
Employee talent is relied on most in which type of production? a. Unit production b. Mass production c. Continuous production d. A primary production system e. A matrix structure
Unit production
Halo runs a tattoo parlor. Customers often make requests for unique words, phrases, or images to be inked permanently into their skin. This is an example of a. mass production. b. unit production. c. continuous production. d. matrix structure. e. lattice structure.
Unit production
In Tom's company, employees are given an opportunity to participate in decision making related to policy development, which is known as a. formalized centralization. b. formalized concentration. c. decentralization. d. formalization. e. centralization.
Decentralization
Authority cannot be delegated to others.
False
Businesses should strive to determine an optimal organizational size.
False
A company's characteristics are determined largely by the founder's personality and values, often stay with the company even after it grows.
True
Dividing an organization's manufacturing jobs into drill press, milling, heat treat, and assembly areas is an example of grouping employees by a. work process. b. employee knowledge and skills. c. business function. d. client. e. location.
Work process
An innovation business strategy would best support firms with which type of organizational structure? a. Centralization b. Decentralization c. Low specialization d. High formalization e. None of these are correct.
Decentralization
Centralization is the system of reporting relationships in the organization.
False
All of the following elements increase as an organization's size increases, EXCEPT a. centralization. b. the number of rules. c. the number of levels in the hierarchy. d. flexibility. e. specialization of labor.
Flexibility
_________ is an organizational structure that groups people with the same skills, or who use similar tools or work processes, together into departments. a. Matrix structure b. Functional structure c. Bureaucratic structure d. Prebureaucratic structure e. Lattice structure
Functional structure
Smaller organizations with low standardization, total centralization, and mostly one-on-one communication have a a. matrix structure. b. functional structure. c. bureaucratic structure. d. pre-bureaucratic structure. e. lattice structure.
Prebureaucratic structure
A virtual organization may not even have a permanent office.
True
An example of formalization is writing down job descriptions and procedures.
True
An organizational chart illustrates the chain of command and reporting relationships in a company.
True
Efficient use of labor is one of the advantages of division of labor.
True
When a firm uses _________ production, the organization typically produces small batches or makes one-of-a-kind custom products.
Unit
One downside of a high division of labor is that it tends to isolate employees.
True
Span of control is the degree to which rules and procedures shape employees' jobs and activities
False
If there is a lot of employee participation in the decision-making process, the organization structure is decentralized, regardless of the nature of the decisions being made.
True
____________________ means decision making occurs throughout the organizational hierarchy.
Decentralization
_________ is the extent to which workers in an organization specialize as opposed to performing a variety of tasks as generalists. a. Segregation b. Departmentalization c. Differentiation d. Administrative component e. Division of labor
Division of labor
Organizations with a _________ are characterized by formal division of labor, hierarchy, and standardization of work procedures. a. matrix structure b. functional structure c. bureaucratic structure d. prebureaucratic structure e. lattice structure
Bureaucratic structure
When a firm uses _________ production, the organization typically uses machines to make the products while employees monitor the machines and implement changes.
Continuous
Organizational structure is NOT impacted by which of the following factors? a. External environment b. Organization's production technology c. Organizational age d. Organizational size e. Business strategy
Organizational age
Most organizational problems can be fixed with restructuring.
True
Span of control refers to the number of people reporting to an individual.
True
When a firm uses _________, typically small batches or one-of-a-kind custom products are produced. a. unit production b. mass production c. continuous production d. a primary production system e. a matrix structure
Unit production
A _________ contracts out almost all of its functions except for the company name and managing the coordination among the contractors. a. lattice organization b. virtual organization c. network organization d. matrix organization e. community of practice
Virtual organization
Which term refers to a group of people whose shared expertise and interest in a joint enterprise informally binds them together? a. Community of practice b. Task force c. Liaison role d. Direct contact e. Cross-functional team
Community of practice
Organizational structure can be analyzed by examining all of the following EXCEPT a. division of labor. b. span of control. c. hierarchy. d. centralization. e. All of these can be examined.
All of these can be examined! a. division of labor. b. span of control. c. hierarchy. d. centralization.
Delegation is the transfer of ____ to make decisions and use organizational resources. a. responsibility b. authority c. leadership d. operational control e. None of these are correct.
Authority
A ____________ is a group of people whose shared expertise and interest in a joint enterprise informally binds them together.
Community of practice
A ___________ is a permanent task force created to address specific problems or recurring needs.
Cross-functional team
Formalization reflects the extent to which organizational rules, procedures, and communications are a. ethical. b. fair. c. written down. d. comprehensive. e. top-down.
Written down
A mechanistic structure can be characterized by all of the following EXCEPT a. it is primarily hierarchical. b. communication is typically vertical. c. knowledge is concentrated at the top. d. instructions come from the boss. e. a high focus on adaptability.
A high focus on adaptability
When individuals or groups throughout the hierarchy are not given an opportunity to participate in decision making, authority is a. centralized. b. efficient. c. specialized. d. flexible. e. decentralized.
Centralized
Which of the following is NOT likely to increase when an organization creates smaller units within a larger organization? a. Flexibility b. Adaptability c. Decision-making speed d. Bureaucracy e. All of these are correct.
Bureaucracy
Which type of multinational organizational structure is appropriate when local differences are large and the benefits of global integration are small? a. Global area division structure b. Regional lattice structure c. Regional headquarters structure d. Global product division structure e. Global transnational division structure
Global area division structure
Large organizations tend to have a _________ hierarchy and more specialization than small organizations. a. relaxed b. smaller c. greater d. shorter e. None of these are correct.
Greater
Grouping employees by ___________ means that groups are organized according to a region of the country or world. a. business function b. location c. output d. work process e. client
Location
Compared to wider spans of control, narrow spans of control are _________ and provide more supervision. a. more structured b. less structured c. less costly d. more costly e. of equal cost
More costly
An organizational ___________ shows all the people, positions, reporting relationships, and lines of formal communication in the organization.
Chart
____________________ is the transfer to others of authority to make decisions and use organizational resources.
Delegation
____________________ refers to the way the organization's work is separated into different jobs to be done by different people.
Division of labor
_________ structure groups people with the same skills, or who use similar tools or work processes, together into departments.
Functional
_________ structure refers to smaller organizations with low standardization, total centralization, and mostly one- on-one communication.
Prebureaucratic
Organizational structure is impacted by the organization's technology, which is also called its a. hours of operation. b. business strategy. c. organizational chart. d. primary production system. e. secondary production system.
Primary production system
A ________ is a collection of functions organized around a particular geographic area, product or service, or market. a. division b. lattice c. network organization d. matrix e. bureaucracy
Division
In which integrating mechanism do managers from different units informally work together to coordinate or to identify and solve shared problems? a. Community of practice b. Task force c. Liaison role d. Direct contact e. Cross-functional team
Direct contact
Communities of practice are not an official part of organizational structure, but they can make money for the organization.
True
Which of the following is a potential disadvantage of division of labor? a. Slower response to environmental changes b. Organizational flexibility c. Decreased potential for conflict, both constructive and destructive d. Greater isolation of employees e. All of these are potential disadvantages of division of labor.
All of these are potential disadvantages of division of labor! a. Slower response to environmental changes b. Organizational flexibility c. Decreased potential for conflict, both constructive and destructive d. Greater isolation of employees
The main advantage of division of labor is that it promotes a. worker satisfaction. b. worker autonomy. c. the creation of stimulating jobs. d. efficient use of labor. e. increased employee motivation.
Efficient use of labor
Which type of multinational organizational structure works best when both global integration and local responsiveness are needed? a. Global area division structure b. Regional lattice structure c. Regional headquarters structure d. Global product division structure e. Global transnational division structure
Global transnational division structure
In Jack's organization, the span of control is very wide. In Pam's organization, the span of control is rather narrow. The number of levels of managers in Jack's organization is likely to be _______ in Pam's organization. a. greater than b. smaller than c. the same as that d. narrower than e. wider than
Smaller than
Organizations with a _________ create horizontal or vertical teams that can define part or all of the organization. a. division structure b. team-based structure c. network structure d. virtual structure e. centralized structure
Team-based structure
A group of civil engineers who share their knowledge and insights with other civil engineers is an example of a a. structured organization. b. virtual organization. c. community of practice. d. task force. e. cross-functional team.
Community of practice
When a firm uses _________, products are created on machines, and employees monitor those machines and implement changes. a. unit production b. mass production c. continuous production d. a primary production system e. a matrix structure
Continuous production
Employees are typically encouraged to make decisions and work collaboratively when the organizational structure is _________ a. centralized. b. flat. c. narrow. d. decentralized. e. None of these are correct.
Decentralized
Which of the following is NOT a good suggestion for creating the conditions that enable communities of practice to flourish? a. Start with a clear area of business need. b. Recruit management involvement. c. Don't start timidly. d. Build on informal employee initiatives already underway. e. Celebrate contributions.
Don't start timidly.
____ is the number of people reporting to a manager. a. Administrative intensity b. Span of control c. Work group size d. Organizational control e. Organizational management
Span of control
Division of labor is often referred to as a. departmentalization. b. the organizational chart. c. specialization. d. configuration. e. the administrative hierarchy.
Specialization
Formalization tends to delineate rules and procedures for employees' jobs
True
It's impossible for managers to create effective communities of practice, only the conditions necessary for them to exist.
True
Which type of structure is characterized by employees having two bosses at the same time? a. Matrix structure b. Functional structure c. Bureaucratic structure d. Prebureaucratic structure e. Lattice structure
Matrix structure
In a ____________, all functional activities are controlled by a product group at headquarters; local managers do not usually provide input into product decisions and are involved only in local administrative, legal, and financial affairs. a. global area division structure b. regional lattice structure c. regional headquarters structure d. global product division structure e. global transnational division structure
Global product division structure
Which type of multinational organizational structure is appropriate when the benefits of global integration are large and local differences are small? a. Global area division structure b. Regional lattice structure c. Regional headquarters structure d. Global product division structure e. Global transnational division structure
Global product division structure
A ____________ has a balanced, matrixed relationship between local managers and headquarters with a two-way flow of ideas, resources, and employees between the two locations. a. global area division structure b. regional lattice structure c. regional headquarters structure d. global product division structure e. global transnational division structure
Global transnational division structure
The structure of an organization is defined as a. the basic purpose of the organization. b. the sum of the individual working arrangements in place in an organization. c. a system of task, reporting, and authority relationships. d. a system of relationships that provides a framework of people. e. the basis through which individual activities are monitored.
A system of task, reporting, and authority relationships.
Which term refers to a permanent committee formed to address specific problems or recurring needs? a. Community of practice b. Task force c. Liaison role d. Direct contact e. Cross-functional team
Cross-functional team
The purpose of organizational structure is to appeal to external competitors.
False
When a manager has a large span of control, he or she can maintain close control over workers and stay in contact with daily operations.
False
When an organizational restructuring results in fewer employees, which of the following is NOT a common effect on the employees who remain? a. Increased turnover intention b. Increased stress c. Increased motivation d. Decreased commitment e. All of these are common effects.
Increased motivation
The structure of small organizations tends to be _________ than the structure found in large organizations. a. less flexible b. more centralized c. more bureaucratic d. less bureaucratic e. None of these are correct.
Less bureaucratic
A _________ is a collection of autonomous units or firms that act as a single larger entity, using social mechanisms for coordination and control. a. division b. lattice c. network organization d. matrix e. bureaucracy
Network organization
In which type of organization do managers spend a lot of time coordinating and controlling the network of contractors and strategic alliances? a. Multinational organization b. Lattice organization c. Network organization d. Matrix organization e. Bureaucratic organization
Network organization
The ________ shows all people, positions, reporting relationships, and lines of formal communication in the organization. a. objectives chart b. organizational chart c. position chart d. PERT chart e. activities chart
Organizational chart
A large organization's legal department is staffed solely with lawyers. This illustrates a. matrix structure. b. functional structure. c. bureaucratic structure. d. prebureaucratic structure. e. lattice structure.
Prebureaucratic structure
Which type of multinational organizational structure is best when a balance of global integration and local responsiveness is needed? a. Global area division structure b. Regional lattice structure c. Regional headquarters structure d. Global product division structure e. Global transnational division structure
Regional headquarters structure
The difference between direct contact and a liaison role is that direct contact is _________ whereas a liaison role is formal. a. informal b. permanent c. temporary d. ineffective e. effective
permanent
Grouping employees by ___________ is similar to grouping them by output, except that the focus is on specific job tasks rather than on what the final product is. a. work process b. employee knowledge and skills c. business function d. client e. location
Client
Little supervision is required with which type of production? a. Unit production b. Mass production c. Continuous production d. A primary production system e. A matrix structure
Continuous production
Which type of organizational structure provides the founder the most control over the organization's decisions and growth? a. Matrix structure b. Functional structure c. Bureaucratic structure d. Prebureaucratic structure e. Lattice structure
Prebureaucratic structure
In organizations with a _________, cross-functional and cross-level subteams are formed and dissolved as necessary to complete specific projects and tasks. a. matrix structure b. functional structure c. bureaucratic structure d. prebureaucratic structure e. lattice structure
Lattice structure
Firms tend to start with an organic structure and then they retain elements of that structure as they grow
False
Which type of organizational structure places a greater importance on employees higher in the structure, as reflected by centralized decision making and a strict chain of command? a. Matrix structure b. Functional structure c. Bureaucratic structure d. Prebureaucratic structure e. Lattice structure
Bureaucratic structure
Jobs grouped according to traditional business tasks such as marketing and human resources are grouped by a. work process. b. employee knowledge and skills. c. business function. d. client. e. location.
Business function
Which of the following is NOT true about communities of practice? a. They must be recognized by executive leadership. b. They usually do not show up on organizational charts. c. They can use the company intranet to develop a sense of community. d. They share knowledge and experience openly and creatively. e. All of these are true of communities of practice.
They must be recognized by executive leadership.
A centralized organization concentrates decision making at the top of its hierarchy.
True
Division of labor is the separation of work into different jobs to be done by different people.
True
In a ____________, regional and/or country managers are given substantial autonomy to adapt strategies to fit local situations. a. global area division structure b. regional lattice structure c. regional headquarters structure d. global product division structure e. global transnational division structure
Global area division structure
The system of reporting relationships in the organization, from the first level up through the president or CEO is known as a. informal communication channels. b. hierarchy. c. bureaucracy. d. administrative interdependence. e. formal communication channels.
Hierarchy
A flatter, team-based structure is usually most appropriate when firms rely primarily on a. unskilled workers. b. highly skilled workers. c. mass production. d. continuous production. e. None of these are correct.
Highly skilled workers
The benefits of a matrix organizational structure include all of the following EXCEPT a. it is flexible. b. it can provide coordinated responses to pressures. c. it is cheaper. d. it improves project coordination. e. it improves communication.
It is cheaper
In which integrating mechanism is a manager or team member held formally accountable for communicating and coordinating with other groups? a. Community of practice b. Task force c. Liaison role d. Direct contact e. Cross-functional team
Liaison role
When a firm uses _________, typically large volumes of identical products are produced, often using assembly lines and machines. a. unit production b. mass production c. continuous production d. a primary production system e. a matrix structure
Mass production
In organizations with a _________, employees report to both a project or product team and to a functional manager. a. matrix structure b. functional structure c. bureaucratic structure d. prebureaucratic structure e. lattice structure
Matrix structure
In which type of structure do costs tend to be higher due to the presence of program managers in addition to the functional managers? a. Bureaucratic structure b. Prebureaucratic structure c. Network structure d. Matrix structure e. Team-based structure
Matrix structure
When there is a small span of control, there is likely to be a. an increase in the number of workers. b. less control over production workers. c. more administrative levels. d. less bureaucracy. e. looser managerial control.
More administrative levels
An organization with _________ structure is likely to succeed in a rapidly changing environment. a. less flexible b. more formalized c. more bureaucratic d. more mechanistic e. more flexible
More flexible
Larger organizations tend to have ________ specialization and more rules, compared to smaller firms. a. less overall b. more overall c. less complicated d. more complicated e. None of these are correct.
More overall
_________ organizations are flexible and decentralized, have open communication channels, and focus on adaptability in helping employees accomplish their goals. a. Organic b. Mechanistic c. Matrix d. Simple e. Bureaucratic
Organic
Which type of structure do new or young organizations typically have? a. Matrix structure b. Functional structure c. Bureaucratic structure d. Prebureaucratic structure e. Lattice structure
Prebureaucratic structure
In a ____________, a headquarters is established in major geographical areas that work collaboratively with the product divisions to give the local units clearer operational goals and directions. a. global area division structure b. regional lattice structure c. regional headquarters structure d. global product division structure e. global transnational division structure
Regional headquarters structure
Organizations that have an organic structure typically a. have many levels in their organizational hierarchy. b. concentrate decision-making powers among few managers. c. require obedience without questioning the organization's goals. d. require their members to be committed to the organization's tasks. e. None of these are correct.
Require their members to be committed to the organization's tasks
Which term refers to a temporary committee formed to address a specific project or problem? a. Community of practice b. Task force c. Liaison role d. Direct contact e. Cross-functional team
Task force
The difference between a task force and a cross-functional team is that a task force is _________ whereas a cross-functional team is permanent. a. formal b. informal c. temporary d. ineffective e. effective
Temporary
Which of the following is true about communities of practice? a. They provide only qualitative, rather than quantitative, value. b. They can span multiple companies. c. They meet regularly. d. They meet in person. e. None of these are correct.
They can span multiple companies
