mgt test 2
Strategic position emerges from three sources:
(1) few needs, many customers; (2) broad needs, few customers; and (3) broad needs, many customers.
Nine Common Decision-Making Biases
1. Availability Bias 2. Representativeness Bias 3. Confirmation Bias 4. Sunk-Cost Bias 5. Anchoring & Adjustment Bias 6. Overconfidence Bias 7. Hindsight Bias 8. Framing Bias 9. Escalation of Commitment Bias
Common Elements of Organizations Four proposed by Edgar Schein:
1. Common purpose: gives everyone an understanding of the organizations reason for being 2. Coordinated effort: the coordination of individual effort into group-wide effort 3. Division of labor: having discrete parts of a task done by different people 4. Hierarchy of authority: making sure the right people do the right things at the right time
Porters Five Competitive Forces
1. Threat of new entrants 2. Bargaining power of suppliers 3. Bargaining power of buyers 4. Threat of substitute products or services 5. Rivalry among competitors
Porters Four Competitive Strategies
1. cost-leadership 2. differentiation 3. cost-focus 4. focused-differentiation
The Four Steps in Rational Decision Making
1. identify the problem or opportunity 2. think up alternative solutions 3. evaluate alternatives and select a solution 4. implement and evaluate the solution chosen
Which of the following is not true about group decision making?
An added benefit of group decision making is groupthink.
types of cultures
Clan, Adhocracy, Hierarchy, Market
benchmarking
Comparing an organization's practices, processes, and products against the world's best.
___________ is an example of a reactive change.
Giving compensation to a customer who complained of receiving bad service
Growth strategy
Involves expansion, as in sales revenues, market share, number of employees, or number of customers
Stability
Involves little or no significant change
Defensive
Involves reduction in the organizations efforts
Cost-focus strategy
Keep the costs of a product below those of competitors and to target a narrow market
Cost-leadership strategy
Keeps the costs of a produce or service below those of competitors and target a wide market
Which of the following is not a supertrend affecting the future of business?
Managers are thinking in terms of mass markets—mass communication, mass behavior, and mass values.
Competitive Intelligence
Means gaining information about one's competitors' activities so that you can anticipate their moves and react appropriately
consensus
Occurs when members are able to express their opinions and reach agreement to support the final decision
Which of the following is not a way that Amazon encourages innovation?
Providing specific solutions
Corporate-level strategies
Single-product Strategy, diversification, vertical integration, blue ocean strategy
Which of the following is not a common reason why incentives may fail to motivate employees?
The incentive plan is based on clear and realistic goals.
union shop
Workers are not required to be union members when hired for a job but must join the union within a specified time
open shop
Workers may choose to join or not join a union
agency shop
Workers must pay equivalent of union dues, but aren't required to join the union
market culture
a. Focused on the external environment b. Values stability and control c. Driven by competition and a strong desire to deliver results
adhocracy culture
a. Has an external focus b. Values flexibility c. Adaptive, creative, and quick to respond to changes in the marketplace
Clan culture
a. Has an internal focus b. Values flexibility rather than stability c. Encourages collaboration among employees
hierarchy culture
a. Has an internal focus b. Values stability and control over flexibility c. Formalized, structured work environment
Closed shop
an agreement in which a company agrees to hire only union members
Four General Decision Making Styles
analytical, conceptual, directive, behavioral
To help with hiring decisions during peak seasons and holidays, Touching Cards uses time-series forecasts, like sales from last Valentine's Day and Christmas, to predict future sales based on patterns of historical data. Touching Cards is making use of
analytics
Which of the following are not parts of compensation?
annual performance reviews
The question "What was the best idea you ever sold to a supervisor, teacher, peer, or subordinate?" would be used in which type of interview situation?
behavioral-description interview
vertical benchmarking
compare yourself to something that has happened in the past
_______ involves gathering information about your competitors' activities so that you can anticipate their moves and react appropriately. For example, you may attend a trade show to learn what types of new products and new iPhone apps your competitors are planning to launch in the next six months.
competitive intelligence
By encouraging employees to experiment with new innovations that are of interest to them, Bezos is supporting which of Scott Berkun's seeds of innovation?
curiosity
A ____ is a graph of decisions and their possible consequences.
decision tree
The organizational development (OD) process has three steps: ___________, accompanied by feedback.
diagnosis, intervention, and evaluation
_______ is the arrangement of having discrete parts of a task done by different people.
division of labor
Greg, the CEO of Organic Market, wants managers and employees to instruct each other about the organization's chosen values and beliefs. Greg has encouraged the seasoned employees to retell stories about the company legends, and he plans on bringing back the monthly rewards. Greg is endeavoring to
embed company culture
Pat, the human resources manager, has significant experience handling ethical issues in the workplace. Over the years he has received extensive training in matters of workplace ethics. Due to Pat's legal background (he is a member of the local bar association), the management of his company rely on Pat to assist them with legal issues, especially with ethical dilemmas. The ideal role for Pat within the organization is
ethics officer
O and T
external
Employees resist change for all the following reasons except
faith in change agent's intentions.
According to Chester I. Barnard, an organization is made up of at least one person who strives daily to achieve the organization's goals.
false
Adaptive change is the introduction of a practice that is new to the organization.
false
An offensive strategy is a grand strategy that involves reduction in the organization's efforts. For example, some large publishers are no longer publishing children's books because they are too expensive to produce and distribute, and because the profit margins are too low to justify the investment.
false
Before applying for a job as a contracts analyst, Carlos read the job analysis for the available position. This document indicated that the responsible employee reviews contracts for technical accuracy and completeness, and tracks invoices against the executed contracts.
false
Being aware of your decision-making style does not really help you determine your strengths and weaknesses as a decision maker, but it can help you understand when a decision needs to be made.
false
Evidence-based management is the use of databases and facts regarding employees to assist in decision ma
false
Evidence-based management is the use of facts regarding an employee, for example when theft is suspected, and using a database to assist in decision making regarding future action.
false
In an organic organization, tasks and rules are clearly specified.
false
In two-tier wage contracts, veteran employees are paid less or receive fewer benefits than new employees.
false
Innovation happens in a "Eureka!" moment and it can be systematized.
false
Organizational culture appears as five levels: observable artifacts, espoused values, basic assumptions, informal groups, and management groups.
false
Organizational development managers and consultants follow a moving vehicle model.
false
Several studies found that strategic planning does not benefit smaller companies, as they very seldom see improvements in financial performance from this type of planning.
false
Strategic positioning involves performing the same activities as rivals in a similar way, but at a lower cost.
false
Sue and Jane Smith are writing the mission statement for their new consignment shop, Then & Now. Because they want their employees and business to grow and reach goals, Then & Now's mission statement should be positive and inspiring, pushing their organization and the workers to achieve goals that they believe are beyond its reach.
false
The IT network that allows for the movement of organizational information within that company is known as the organizational structure.
false
The local university is now facing some tough decisions, so they are using the decision tree, which contains individuals, websites, and organizations that specialize in handling sensitive and difficult decisions.
false
The organizational-management process consists of seven steps: (1) doing research, (2) establishing the mission and vision, (3) assessing the current reality, (4) formulating the grand strategy, (4) implementing the strategy, (6) maintaining strategic control, and (7) maintaining the feedback loop
false
Two advantages of decentralization are that (1) managers are encouraged to not solve their own problems, but rather to ask for assistance as soon as possible, and (2) decisions are made more slowly, because they are discussed at a higher level of management.
false
Leela's Home Decorators believes that the demand for its services will expand greatly, because a real-estate developer has just purchased 100 acres in town. The developer is planning to build 1,000 condominium units on the property. The managers of Leela's Home Decorators are making a projection for the future, also known as a
forecast
Salvador, who works as a waiter in a top restaurant in Manhattan, likes the fast pace of his work and the fact that things are always changing there. Salvador can be said to
have a high tolerance for ambiguity.
stars
high growth, high market share
question marks
high growth, low market share
______ consists of the activities that managers perform to plan for, attract, develop, and retain an effective workforce.
human resource management
contingency planning
identifies alternative courses of action to take when things go wrong
When a grocery store chain adopts a new practice of its competitors by staying open 24 hours a day, requiring employees to work flexible schedules, it is implementing a(n) ______ change.
innovative
S and W
internal
cash cows
low growth, high market share
dogs
low growth, low market share
Francis, who is starting a painting business, plans to write down the purpose of his painting business and his company's reason for being. Francis is writing his
mission statement
Ana is a teacher who became interested in helping adults in some of the poorer neighborhoods learn how to read. She plans to start a reading center in a low-income area to help residents with reading skills at no cost. Ana's center is an example of a(n)
nonprofit organization
• Blue Ocean Strategy
o A company creates a new, uncontested market space that males competitors irrelevant, creates new customer value, and decrease costs
• Satisficing model
o Because of constraints, managers don't make an exhaustive search for the best alternative o Instead, managers seek alternatives until they find one that is satisfactory
• Single-product Strategy
o Company makes and sells only one product within its market o Benefit is that a company can focus on just one product
• Vertical Integration
o Firm expands into businesses that provide the supplies it needs to make its products or that distribute and sell its products
• Intuition model
o Making a choice without the use of conscious thought or logical inference
• Focused-differentiation strategy
o Offers products that are of unique and superior value compared to those of competitors and to target a narrow market
Differentiation strategy
o Offers products that are of unique and superior value compared to those of competitors but to target a wide market o Justify why you get customers to pay a higher price
• Diversification
o Operating several businesses in order to spread the risk o Products may be related or unrelated
• Bounded Reality
o Suggests that the ability of decision makers to be rational is limited by numerous constraints
• Human Resource Management:
o consists of the activities managers perform to plan for, attract, develop, and retain an effective work force
• Knowledge Worker:
o someone whose occupation is principally concerned with generating or interpreting information, as opposed to a manyal laborer
human capital
o the economic or productive potential of employee knowledge, experience, and actions o writing becomes trade secrets o if not written down, it is not capital to the organization
• Social Capital:
o the economic or productive potential of strong, trusting, and cooperative relationships
A company dress code and award ceremonies would be part of
observable artifacts
Computer-assisted instruction is usually a form of
off-the-job training
When a manager is so frantic to get rid of the problem that he or she can't deal with the situation realistically, the manager is experiencing
panic
_____ is the set of processes and managerial behaviors that involve defining, monitoring, measuring, evaluating, and providing consequences for performance expectations.
performance management
Changes that label Amazon as a disrupter in the industry are considered _____________ changes.
radically innovative
Applications, résumés, interviews, and employment tests are all ______ tools.
selection
Which supertrend facing the future of business is Amazon directly escaping by continuing a culture of innovation and creating new products and services before competitors?
some companies are unable to survive disruptive innovation.
Philip, a shift manager in a factory, has 40 employees on his shift that he directly supervises. The 40 workers who report directly to Philip represent his
span of control
A hierarchy culture has an internal focus; it values ____ over flexibility.
stability and control
______________ focus(es) on developing a comprehensive program for long-term success.
strategic planning
Many customers have visited Sally's Diner for decades because of the diner's friendly service. Most customers feel that Sally's is the friendliest placed around. In a SWOT analysis, the friendly service at Sally's is an example of a company
strength
SWOT Analysis
strengths, weaknesses, opportunities, threats
horizontal benchmarking
take a measure from another company and compare yourself, or use average to compare
Resistance to organizational change is considered to be the interaction of three causes: employee characteristics, change agent characteristics, and
the change agent-employee relationship.
Anthony, the plant manager, was talking with another manager about Tim, the lead engineer in the corporate R & D department. Anthony remarked, "Tim is so bright, and he is an expert in designing products. But like so many experts, he can't imagine what it's like to be as ignorant as the rest of us. I think at times, he cannot see things from an outsider's perspective." Tim is suffering from
the curse of knowledge
A corporate culture is a defined set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and reacts to its various environments.
true
A stability strategy is a grand strategy that involves little or no significant organizational change. For example, Love Forever is a jewelry store that sells only one type of item: engagement and wedding rings. The management of Love Forever does not plan to branch out into selling different types of jewelry; the company has a reputation for being the go-to store to purchase wedding rings, and it plans to maintain that strategy.
true
Benefits account for about one-third of compensation costs.
true
Hannah, the youngest owner of a family-owned grocery, wants to make sure her company's culture is embedded in their organization. In a recent tradeshow workshop, she learned that she can do this by having company rites and rituals, continuing to tell stories about company legends, and being a role model to her employees.
true
In deciding to decide, a manager agrees that he or she must decide what to do about a problem or opportunity and take effective decision-making steps.
true
In sexual harassment, the harasser may be a(n) outsider, coworker, supervisor, or someone of the same sex.
true
Johnson's Fruit Farm is one of several stores in the county where customers can purchase locally grown fruits and vegetables. However, Mrs. Johnson also offers weekly workshops in her store on topics such as canning, healthy eating, and how to grow a garden, which no other store in the county does. By offering these unique workshops, the Johnsons are engaging in strategic positioning.
true
Mutual-benefit organizations are voluntary collectives whose purpose is to advance members' interests, while nonprofit organizations are formed to offer services to some clients, not to make a profit.
true
Onboarding programs help employees to integrate and transition to new jobs by making them familiar with corporate policies, procedures, cultures, and politics by clarifying work-role expectations and responsibilities.
true
Research shows that most managers have characteristics that fall into two or three decision-making styles, and that decision-making styles vary across occupations, job level, and countries.
true
Strategy implementation is putting strategic plans into effect, which means dealing with roadblocks within the organization's structure and culture and seeing if the right people and control systems are available to execute the plans.
true
When managers and employees within the same department are brought together in cross-functional teams to solve particular problems, their company is using a team-based design.
true
To explain how to initiate, manage, and stabilize planned change, Kurt Lewin developed a model with three stages:
unfreeze, change, and refreeze.
When the two newly hired analysts compared notes, they found that their interviews had been quite different. Each was long and involved, but the content of the questions varied based on previous employment and education. They confirmed that the company that hired them used ______ interviews.
unstructured
Employers must consider an employment test's ______—that is, whether or not it measures what it purports to measure and is free of bias.
validity
The chain of command is also known as the
vertical hierarchy
An organization's vision statement states _____. For example, the Cleveland Clinic's vision statements says that it "strives to be the world's leader in patient experience, clinical outcomes, research, and education."
what the company wants to become, where it wants to go strategically
Matrix Structure
• 2+ bosses at all times • Combines functional and divisional chains of command in a grid so that there are two command structures; vertical and horizontal
The Delphi Technique
• A group process that uses physically dispersed experts who fill out questionnaires to anonymously generate ideas • The judgments are combined and in effect averaged to achieve a consensus of expert opinion • Originally designed for technological forecasting but now is used as a multipurpose planning tool
Functional Structure
• Allows for a division of labor, encourages specialization • Divide work up, less duplication • People with similar occupational specialties are put together in formal groups
Divisional Structure
• Allows to specialize in an industry or a region • People with diverse occupational specialties are put together in formal groups by similar products, customers or geographic regions
Nonrational Decision Making
• Assumes that decision making is nearly always uncertain and risky, making it difficult for managers to make optimal decisions
Subjective Appraisal
• Based on a mangers perceptions of an employees traits and behaviors • Easy to create and use, but validity is questionable
Objective Appraisal
• Based on fact and often numerical • Measures results • Harder to challenge legally
Big Data
• Includes not only data in corporate databases but also web browsing data trails, social network communications, sensor data, and surveillance data
The hollow or network structure
• Outsourcing • The organization has a central core of key functions and outsources other functions to vendors who can do them cheaper or faster
Simple Structure
• Smaller, highly coordinative • Authority is centralized in a single person with few rules and low work specialization • Ex: an owner, an administrative assistant
Performance management
• Step 1: define performance o Set goals o In the training process • Step 2: monitor and evaluate performance o Measure progress and outcomes • Step 3: review performance o Deliver feedback and coaching • Step 4: provide consequences o Administer valued rewards and appropriate punishment
How employees learn culture:
• Symbols • Stories • Heroes • Rites and rituals • Organizational socialization
Horizontal Design
• Teams or workgroups, either temporary or permanent, are used to improe collaboration and work shared on tasks by breaking down internal boundaries
organizational culture
• The set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and reacts to its various environments
