Chapter 15 - Organizational Behavior

Which of the following best describes a company that has adopted a low-cost producer strategy?

It focuses on efficiency and productivity.

organizational chart

a drawing that represents every job in the organization and the formal reporting relationships between those jobs

restructuring and organizational commitment

a moderate negative effect on commitment, affective commitment tends to be lower in organizations that restructure

narrow spans of control

allow managers to be much more hands-on with employees, giving them the opportunity to use directive leadership styles while developing closely mentoring relationships with employees especially important if the manager has substantially more skill or expertise than the subordinates requires organizations to hire many managers, which can significantly increase labor costs if the span of control becomes too narrow, employees can become resentful of their close supervision and long for more latitude in their day-to-day decision making

Which of the following statements about organizational charts are true?

an organizational chart represents the formal reporting relationship between jobs an organizational chart represents every job in an organization an organizational chart typically is filled with the names of persons and job titles

chain of command

answers the question of "who reports to whom?" and signifies formal authority relationships

geographic structures

based around the different locations where the company does business reasons revolve around the different tastes of customers in different regions, the size of the locations that need to be covered by different salespeople, or the fact that the manufacturing and distribution of a product are better served by a geographic breakdown

An organization's customers, competitors, suppliers, and distributors are all parts of its

business environment

Which of the following factors influence the process of organizational design?

business environment company size company strategy

The degree to which decision-making authority is held by those at the top levels of the organization is referred to as

centralization

In ______ organization, power and authority are concentrated within a relatively tight group of individuals at the highest levels of the organization.

centralized

Kendra works as a sales representative for a large company. She reports to a regional sales manager, who in turn reports to the national sales manager. The national sales manager takes orders from the CEO of the company, who reports to the Board of Directors. This best describes which element of organizational structure?

chain of command

Which of the following is the element of organizational structure that describes who reports to whom within an organization?

chain of command

What has been the most common kind of restructuring that companies have undertaken in recent years to reduce costs?

changing to a flatter structure

The decisions and actions applied to achieve an organization's objectives and goals are its

company strategy

business environment

consists of its customers, competitors, suppliers, distributors, and other factors external to the firm, all of which have an impact on organizational design - effect on structure is whether the outside environment is stable or dynamic stable don't change frequently, and any changes that do occur happen very slowly, allow organizations to focus on efficiency and require little change over time. dynamic environments change on a frequent basis and require organizations to have structures that are more adaptive

In order to achieve standardization, formalization is a necessary _____________ mechanism.

coordination

company strategy

describes an organization's objectives and goals and how it tries to capitalize on its assets to make money two common strategies - be either a low-cost producer or a differentiator

The process of establishing, choosing, or altering the structure of an organization is known as organizational

design

organizational structure

dictates how jobs and tasks are divided and coordinated between individuals and groups within the company

mechanistic organizations

efficient, rigid, predictable, and standardized organizations that thrive in stable environments typified by a structure that relies on high levels of formalization, a rigid and hierarchical chain of command, high degrees of work specialization, centralization of decision making, and narrow spans of control

multi-divisional structures

employees are grouped into divisions around projects, geographic regions, or clients. each division operates relatively autonomously from the others and has its own functional groups generally develop from companies with functional structures whose interests and goals become too diverse for that structure to handle

bureaucratic structure

exhibits many of the facets of the mechanistic organization designed for efficiency and rely on high levels of work specialization, formalization, centralization of authority, rigid, and well-defined chains of command, and relatively narrow spans of control

True or false: When a company flattens its organizational structure it generally lays off employees but not managers.

false

Anton's company has gone through a massive restructuring over the past year and has eliminated many levels of management. Each manager now has more people reporting to him or her. It would appear that Anton's company has become a relatively ______ organizational structure.

flat

organic organizations

flexible, adaptive, outward-focused organizations that thrive in dynamic environments typified by a structure that relies on low levels of formalization, weak or multiple chains of command, low levels of work specialization, and wide spans of control more likely to allow for transformational leadership to have a positive effect on employees

A mechanistic organization would be characterized by which of the following?

formal policies, procedures, and rules centralized decision making

The degree to which rules, policies, and procedures are used to standardize behaviors and decisions within an organization is known as

formalization

Which of the following are elements of organizational structure?

formalization centralization

Billie works in the accounting department of an electronics firm. She interfaces regularly with the purchasing department to make sure they have approved requisitions for payment, as well as with the human resources department with respect to payroll. Her company has a ______ organizational structure.

functional

The most basic bureaucratic structure is one that is

functional

Match the type of bureaucratic structure (at left) with its definition (at right). Instructions

functional - groups employees by the jobs they perform product - groups business units around what the company produces geographic - based around the different locations where the company does business client - based upon the types of customers the organization serves

types of bureaucratic structures

functional structure geographic structure product structure client-based structure

The multi-divisional structure can be based on any of the following except

functions

A gourmet burger restaurant has established separate divisions for operations in the northeast, southeast, western, and central United States. Managers in each of these regions have authority to change the restaurant's menu to adapt to local tastes and to make use of fresh, regionally available ingredients. What type of organizational structure has this restaurant chain adopted?

geographic

Marketing a product in Western Europe may have different requirements from marketing the same product in the United States or in South America, so companies that market products globally often adopt a ______ structure.

geographic

product structures

group business units around different products that the company produces. each of those division becomes responsible for the manufacturing, marketing, and doing research and development for the products in its own division make sense when firms diversify to the point that the products they sell are so different that managing them becomes overwhelming downsides - when the divisions don't communicate and they don't have the ability to learn from one another

functional structure

groups employees by the functions they perform for the organization success is based on the efficiency advantages that come with having a high degree of work specialization that's centrally coordinated extremely efficient when the organization as a whole has a relatively narrow focus, fewer product lines or services, and a stable environment biggest weaknesses tend to revolve around the fact that individuals within each function get so wrapped up in their own goals and viewpoints that they lose sight of the bigger organizational picture

restructuring and job performance

has a weak negative effect on performance. task performance tends to be somewhat lower in organizations that restructure

characteristics of mechanistic organizations

high degree of work specialization - employees are given a very narrow view of the tasks they are to perform very clear lines of authority - employees know exactly to whom they report high levels of hierarchical control - employees are not encouraged to make decisions without their manager's consent information is passed through vertical communication between an employee and his or her supervisor employees are encouraged to develop firm-specific knowledge and expertise within their area of specialization

high level of work specialization

high level of formalization

Which of the following are benefits of high levels of job specialization?

increased work productivity decreased training costs and time

characteristics of organic organizations

low degree of work specialization - employees are encouraged to take a broad view of the tasks they are to perform although there might be a specified chain of command, employees think more broadly in terms of where their responsibilities lie knowledge and expertise are decentralized - employees are encouraged to make their own decisions when appropriate lateral communication is encouraged - focusing on information and advice is opposed to orders employees are encouraged to develop knowledge and expertise outside of their specialization

When a company has a product structure, which of the following are handled by each division?

manufacturing marketing research and development

In a ______ structure, each employee has two or more chains of command, along with multiple groups with which to interact.

matrix

Marcus is an engineer who heads up a product development team working on a new line of chairs for computer desks. The team has members from marketing, finance, manufacturing, and quality. Based on this information, Marcus's company has a ________ structure.

matrix

The organizational structure that uses a combination of the functional and product structures is the ______ structure.

matrix

A bureaucratic structure exhibits many of the facets of a(n) ______ organization in terms of work specialization, formalization, and centralization.

mechanistic

An organization that is highly centralized with narrow spans of control and very formalized procedures is a(n) ______ organization.

mechanistic

As a general rule, the larger an organization becomes, the more ______ it is likely to be.

mechanistic

matrix structures

more complex designs that try to take advantage of two types of structures at the same time the matrix allows an organization to put together very flexible teams based on the experiences and skills of their employees this flexibility enables the organization to adjust much more quickly to the environment than a traditional bureaucratic structure would

The bureaucratic structure that arranges employees by multiple factors such as region, products, or clients is known as the ______ structure.

multi-divisional

In a simple structure, the central decision maker is typically

one person

An ______ is a graphic representation of the jobs and reporting relationships within an organization.

organizational chart

Which of the following are combined in a matrix structure?

product structure functional structure

General Motors groups its business units around the different lines of cars it sells, such as Buick, Cadillac, GMC, and Chevrolet, indicating it has an organizational structure based on

products

differentiation strategy

rather than focusing on supplying a product or service at the lowest cost, these companies believe that people will pay more for a product that's unique in some way. often hinges on adjusting to changing environments quickly, which often makes an organic structure more appropriate.

centralization

refers to where decisions are formally made in organizations

low-cost producer strategy

rely on selling products at the lowest possible cost, have to focus on being as efficient as they can be

span of control

represents how many employees each manager in the organization has responsibility for

Anton's company recently reduced its headcount by over 2,000 employees and eliminated several layers of management. This is an example of

restructuring

Organizations change their structure through the process of

restructuring

As a general rule, the more ______ the technology, the more mechanistic an organization will be.

routine

Angi has opened a new gourmet cupcake store in a small college town. It has two employees: Angi, who does all of the baking and decorating, and her daughter Sandi, who takes orders and runs the cash register. Based upon this information, it can be assumed that Angi's cupcake shop has a ______ structure.

simple

The organizational structure used by most new businesses is the ______ structure, because it is very flexible and easy to coordinate.

simple

The number of employees a supervisor oversees is known as the supervisor's

span of control

In a ____________ business environment, changes occur slowly and organizations can focus on efficiency.

stable

Organizational ______ refers to how an organization arranges people and jobs so that its work can be performed and its goals can be met.

structure

An organization that has a relatively narrow span of control requires more managers and more hierarchical levels, creating a ______ organization structure.

taller

Organizations transform inputs into outputs through the use of

technology

formalization

the degree to which rules and procedures are used to standardize behaviors and decisions in an organization

work specialization

the degree to which tasks in an organization are divided into separate jobs sometimes referred to ask a company's division of labor

organizational design factors

the environment in which the organization does business its corporate strategy and technology the size of the firm

technology

the method by which it transforms inputs into outputs the more routine a technology is, the more mechanistic a structure should be

simple structures

the most common form of organizational design, primarily because there are more small organizations than large ones more than 80 percent of employing organizations have fewer than 19 employees generally used by extremely small organizations in which the manager, president, and owner are all the same person a flat organization with one person as the central decision-making figure; not large enough to have a high degree of specialization and will only have very basic differences in work specialization

Elena is a middle manager in a large organization. Her span of control within the organization is defined by

the number of subordinates she supervises.

restructuring

the process of changing an organization's structure research suggests it has a small negative effect on task performance, likely because changes in specialization, centralization, or formalization may lead to confusion about how exactly employees are supposed to do their jobs, which hinders learning and decision making has a more significant negative effect on organizational commitment restructuring efforts can increase stress and jeopardize employees' trust in the organization lower level of affective commitment on the part of the employees, because they feel less emotionally attached to the firm

organizational design

the process of creating, selecting, or changing the structure of an organization

company size

the total number of employees, and structure

True or false: Large organizations with more employees generally require more standardization, formalization, and coordinating mechanisms to function efficiently.

true

client structure

when organizations have a very large number of customers or groups of customers that all act in a similiar way, they might organize their businesses around serving those customers

All the following determinations are influenced by organizational structure, except

whether an employee is fired or promoted.

At a small bakery, two workers are assigned the tasks of baking bread and sweet rolls. Two other workers are responsible for baking cakes and cupcakes. Yet another worker does all of the cake decorating. This describes how the bakery handles

work specialization

five key elements of organizational structure

work specialization chain of command span of control centralization formalization

Match the organizational structure dimension (at left) with its description (at right). Instructions

work specialization - the way in which tasks in an organization are divided into separate jobs chain of command - the line of authority that runs from the top level of the organization to the lowest level span of control - the number of subordinates for which a manager is responsible centralization - a type of organization where decisions are made at the top levels of the organization formalization - the degree to which rules and procedures are used to standardize behaviors and decisions