MGT 4394 Chapter 11
Which of the following terms or phrases best characterizes Zappos' organizational structure?
extremely flat
Which of the following features helps match a cost leadership strategy to a functional structure?
focus on economies of scale
McDonald's uses detailed standard operating procedures throughout the world to ensure product quality. This implies that McDonald's has a high degree of _____.
formalization
A typical college of business (or school of management) has several areas such as management, marketing, finance, accounting, MIS, and so on. This is an example of a(n) _____ structure.
functional
A firm that uses a structure that is organized along different business functions such as HR, R&D, Sales, and Marketing and also along different geographical areas such as different countries of the world is most likely using a _____ structure.
global matrix
Which of the following is a feature of an organic organization?
high span of control
Coda Inc. is an apparel manufacturer. The management at Coda prefers moderate control over the operations of the different departments such as R&D, design, marketing, and sales. It allocates a budget to each function at the beginning of each quarter. This is an example of implementing control through _____.
input controls
Which of the following is true of a functional structure?
it relies on a relatively flat organizational structure
Why is the optimal organizational structure a multidivisional structure?
its focus is on driving costs down
Which of the following characteristics of McDonald's best supports the fact that it is a mechanistic organization?
its job descriptions are very descriptive
A functional structure is recommended when a firm:
low level of diversification
An organization that is organized according to strategic business units (SBUs) and also along organizational structures is most likely using a _____ structure.
matrix
Walmart is an example of a(n) _____ organization.
mechanism
Which of the following best exemplifies the use of input controls?
McDonald's use of standard operating procedures
Opal, a recent fashion design school graduate, has received praise for her clothing designs from her peers and friends on social networking sites; this has inspired her to set up a store where she can design and sell apparel. After experiencing some success with sales, she recruits two employees to handle customers at the store. However, she handles other day-to-day affairs herself, while continuing to design clothes. Which of the following is likely to be a pitfall of this organizational structure established by Opal?
Once the firm starts growing and attracting more customers she is likely to feel overloaded
What is most likely to happen if a firm relies too long on a competency without honing, refining, and upgrading as the firm and the environment change?
The firm's culture can turn from a core competency into a core rigidity
How does W.L. Gore exemplify founder imprinting?
The four core values articulated by Bill Gore guide the company and its associates to this day.
Rast Inc. is an adhesive manufacturer. After a slight dip in production numbers, it forms a team to find a quick solution to this problem, at least for the shorter term. This scenario best exemplifies _____.
exploitation
Output controls can sometimes discourage collaboration among different strategic business units. However, more and more work requires creativity and innovation, especially in highly developed economies. One way firms are grappling with this issue is by:
introducing results-only-work-environments to tap intrinsic motivations
McDonald's operates Hamburger University that trains students to ensure consistent food quality across its outlets throughout the world. This indicates that McDonalds's:
is mechanistic in nature
Which of the following is an advantage offered by a functional structure?
it allows for a higher degree of specialization and deeper domain expertise
Kolt Inc., a large and successful retail chain on the West Coast, decides to expand its operations across the U.S. Which of the following organizational structures should Kolt Inc. use?
multidivisional
When a firm diversifies into different product lines and geographies, a _____ structure is preferred.
multidivisional
Which of the following global strategies best matches with a multidivisional structure?
multidomestic
_____ define appropriate employee attitudes and behaviors.
norms
Organizational culture can help a firm gain and sustain competitive advantage only if the culture makes a positive contribution to the firm's economic value creation and _____.
obeys the VRIO principles
An organization is characterized as having a flexible division of labor, distributed decision-making, and generalized knowledge of how to accomplish strategic goals valued. This organization is most likely _____ in nature.
organic
Employees learn about an organization's culture through the process of _____.
socialization
_____ describes the degree to which a task is divided into separate jobs
specialization
Cup N Cone Inc., a graphic design firm, has offices in New York, Texas, California, New Mexico, and New Jersey. Each of these offices is headed by a president who reports directly to Marvin Grey, the CEO. The heads of the centralized HR, Finance, and Marketing teams report to Marvin Grey as well. Managers in the various offices also report to the CEO directly. Based on this information, which of the following statements is most likely to be true?
Marvin Grey has a wide span of control
Which of the following real-world scenarios best exemplifies formalization?
McDonald's use of standard operating procedures across the world
Why does a functional structure rely on a flat organizational structure?
it allows for efficient bottom up and top down communication
Organizational culture can be the basis of a firm's competitive advantage if _____.
it is valuable, rare, and difficult to imitate
_____ organizations are characterized by a high degree of specialization and formalization, and tall hierarchies that rely on centralized decision making
mechanism
Remote Inc. is a notebook manufacturing company based in Ohio. Remote's main market is Ohio. It aims at providing its products at better prices than its competitors. Which of the following structures is Remote Inc. likely to use if it has functional setup?
mechanistic
A firm's _____ determines how the work efforts of individuals and teams are orchestrated and how resources are distributed.
structure
Why did W.L. Gore reorganize itself into a functional structure from a simple structure?
A simple structure could not provide the effective division, coordination, and integration of work required to accommodate future growth.
Which of the following statements about an organization's culture is NOT true?
A strong monitoring and supervision mechanism is needed to enforce the culture
W. L. Gore & Associates is the inventor of path-breaking new products such as breathable GORE-TEX fabrics, Glide dental floss, and Elixir guitar strings. Which of the following would be most likely to hinder its intention of fostering employee satisfaction, retention, and creativity?
An extremely formalized organizational structure
_____ refers to the degree to which decision making is concentrated at the top of the organization.
Centralized
GM's insistence on sticking to a bureaucratic culture combined with its M-form structure and its subsequent failure to adapt to changing customer preferences for more fuel-efficient cars, produce higher quality, and create innovative designs best exemplifies _____.
core rigidity
Flight Stream Inc., a toy manufacturing company, encourages its employees to enjoy their work by taking on additional responsibilities or switching jobs with each other. It allows its employees immense flexibility in charting their own career path within the organization. Chris has worked at Flight Stream for eight years but has never had a boss or supervised
Flight stream Inc. has a flat organizational structure
The relationship between strategy and structure that directly impacts a firm's performance is _____.
dynamic
To maintain its core competency of providing a superior customer experience in the face of explosive growth, Zappos split the organization into 10 standalone units. Which of the following does this scenario best illustrate?
How an organization accommodates strategy implementation through a flexible organizational structure
Why does a firm use an organic organization combined with a functional structure when implementing a differentiation strategy?
It allows the firm to constantly upgrade core competencies in R&D, innovation, and marketing.
Which of the following is an unintended side-effect of a high degree of specialization in an organization
Reduced employee satisfaction due to repetition of tasks
Which of the following real-world scenarios best exemplifies the use of organizational culture to build competitive advantage?
Southwest Airlines pilots sometimes help load baggage, which results in quick turnaround time.
Why does strategy implementation often require changes within an organization
Strategy implementation transform strategy into actions and business models
Which of the following statements about W.L. Gore & Associates best supports the fact that it is organized in an informal and decentralized manner?
W.L. Gore & Associates refers to its employees as associates rather than employees
Which of the following is true of the process of organizing for competitive advantage?
To maintain competitive advantage, companies need to restructure as they grow and the competitive environment changes.
Which of the following types of groups is most susceptible to groupthink?
a cohesive group
W.L. Gore & Associates is organized in such a way that it has no formal job titles, job descriptions, or chains of command. This implies that it has:
a decentralized strusture
Why must managers use a mechanistic structure to implement a cost-leadership strategy?
a mechanistic structure offers a centralized structure with well defined lines of authority
Fast Call Inc. is a pharmaceutical company that has many breakthroughs in medicine to its credit. Unlike many other pharmaceutical companies, Fast Call has a relaxed work environment where employees are free to discuss projects with each other. Employees are encouraged to choose the projects that interest them; communication between team members and their supervisors is open and easy. Because of the company's work culture, its employees feel motivated to work harder and display more entrepreneurial behaviors. In this scenario, Fast Call Inc. is most likely an organization that is _____.
organic
If a firm pursues only a differentiation strategy, it is most likely a(n) _____ organization.
organic
To effectively implement a differentiation strategy, managers rely on a functional structure that resembles an organization that is highly _____.
organic
_____ organizations have a low degree of specialization and formalization as well as a flat organizational structure.
organic
Zappos' 10 core values that define what it means for employees to be working at Zappos also define the _____ of Zappos.
organizational culture
_____ describes the collectively shared values and norms of an organization's members
organizational culture
Which of the following statements is true of strategy in an organization?
organizational structure must follow strategy in order for firms to achieve superior performance
Since an organic structure helps a firm build core competencies in areas such as R&D and marketing, this structure is employed by firms that:
pursue a differentiation strategy at the business level
Florian just graduated from law school and wants to start his own law firm. It is best for Florian to use a _____ organizational structure
simple
While working a night job at a call center, Neville creates an app called FastServe, which can be used to place orders at restaurants, rate the restaurants, and make reservations. Because he receives good responses for his app, he quits his current job to focus his efforts on FastServe. He creates a startup called TYOP and hires three people to help him improve FastServe and maintain the servers that run it. In this scenario, TYOP most likely has a _____ structure.
simple
A high degree of formalization in an organization is most likely to _____.
slow down decision making
Black Mouse Inc., a web development firm, is headed by Rob Dennis, the CEO. Each functional department of the company—marketing, finance, and HR—has a president who reports to the CEO directly. Each department has various managers who manage teams. The managers report to the presidents and the team leads report to the managers. Finally, the employees at the lowest level report to their team leads. It is rare for a lower-level employee to interact with the CEO of the company. In this scenario, Black Mouse Inc. can be said to have a(n):
tall hierarchical structure
Which of the following statements is true about the use of functional structures with various business strategies?
the goal of differentiation strategy is to crete a competitive advantage by controlling costs
Which of the following statements best describes groupthink?
It is a situation in which opinions coalesce around a leader without individuals critically challenging and evaluating that leader's opinions and assumptions.
What most likely happens when a firm optimizes its organizational structure to its current situation?
It plants the seed of subsequent failure: the tightly coupled system can break apart when internal or external pressures occur.
What was one of the reasons for Jerry Yang's failure at Yahoo?
What was one of the reasons for Jerry Yang's failure at Yahoo?
Which of the following is true of W.L. Gore & Associates, which has a lattice organizational form?
all employees are empowered to speak to all other employees in the organization
Curve Inc. is a software development firm based in California. It strives to provide highly differentiated software at cheaper prices when compared to its competitors. Which of the following organizational designs should Curve Inc. implement to ensure the maximum success of its business strategies?
ambidextrous
Gannett Company integrated certain important functions of USA Today.com with USA Today, while keeping other functions independent. To support this integration, the president of USA Today shifted compensation incentives for both senior teams to accomplish joint goals rather than to focus solely on each business unit's performance. This scenario best exemplifies a(n) _____.
ambidextrous organization
organizational design is:
the process of creating, implementing, and modifying the structure of an organization.
A company that is using extrinsic motivation as an output control mechanism will most likely:
threaten to lay off employees if they do not achieve targets
