Chapter 3 Questions

Which of the following illustrates the MOST common form of environmental turbulence? a) Organizational crisis b) Jockeying among competitors for market position c) Power of buyers d) Environmental scanning e) Extremely dynamic environment

a) Organizational crisis - unexpected changes and upheavals in the environment of an organization

Many corporations have sophisticated security systems for information and employees. Which dimension of the organization's environment do these systems represent? a) Technological element of the General Environment b) Internal Environment c) Economic element of the Task Environment d) Technological element of the task environment e) Economic element of the general environment

a) Technological element of the General Environment - the methods available for converting resources into products or services

DuPont Company's purchase of the London-based ICI Company will combine the two companies' technical capabilities in the production of plastic film used in packaging and coating plastic cards such as credit cards. The ICI Company will continue operation in London under the DuPont name. The combining of the two companies is an example of a(n)... a) acquisition by DuPont b) merger c) joint venture d) acquisition by ICI e) strategic alliance

a) acquisition by DuPont - when one firm buys another

The extent to which the environment is relatively stable or dynamic is referred to as the degree of... a) change b) uncertainty c) environmental turbulence d) homogeneity e) tangibility

a) change

Video teleconferencing impacts the number of business travelers who fly. This is an example of _____ to the airline industry. a) competitors b) suppliers c) boards of directors d) strategic partners e) regulators

a) competitors

_____ is NOT one of the five forced identified by Michael Porter as having an impact on the interaction between an organization and its environment. a) Power of suppliers b) Threat of increased regulation c) Competitive rivalry d) Power of buyers e) Threat of new entrants

b) Threat of increased regulation - Threat of substitute products

A purchasing agent is an example of a(n)... a) intelligence agent b) boundary spanner c) strategic ally d) regulator e) supplier

b) boundary spanner - an employee who accumulates information through contacts outside the organization

Hunter sells security surveillance equipment to international airports. His job is to go to the prospective customer, examine the airport's current security, locate problem areas, and explain how his company's security surveillance system would eliminate these problems. Hunter is an example of a(n)... a) intelligence agent b) boundary spanner c) strategic ally d) regulator e) supplier

b) boundary spanner - an employee who accumulates information through contacts outside the organization

When Dayton Hudson was the target of a hostile takeover it was able to use its position of influence in the state of Minnesota to pressure the state legislature to change the laws preventing breakup of any company immediately after purchase. Dayton Hudson responded to the crisis using... a) merger b) direct influence c) hostile takeover d) alliances e) acquisitions

b) direct influence - attempting to change the nature of the competitive conditions in its environment to suit its needs; pursing new or changed relationships with suppliers, customers, and regulators

One of the basic frameworks used to describe how environments affect organizations is... a) influence group pressure b) environmental change and complexity c) regulatory pressure d) situational diversity e) regulatory contingency

b) environmental change and complexity

Which of the following statements is NOT a characteristic of strategic alliances as an element of the task environment? a) Strategic alliances work together in joint ventures and other similar arrangements b) Strategic alliances increase the risk of losing sensitive information c) Strategic alliances increase organizational exposure to economic risk d) Companies join strategic alliances to gain expertise that they may lack e) Many companies in strategic alliances have multinational partners

c) Strategic alliances increase organizational exposure to economic risk - alliances DECREASE organizational exposure to economic risk

Which of the following statements does NOT describe a characteristic of an organization's external environment? a) It includes specific, identifiable organizations and factors of interest to the organization. b) It is composed of general and task components. c) The boundary between the organization and its environment is quite specific and clearly defined. d) It contains some nonspecific dimensions and forces that can affect organization activities. e) It includes everything outside of the organization that might potentially affect it.

c) The boundary between the organization and its environment is quite specific and clearly defined.

Which of the following would have the LEAST to worry about in terms of the threat of new entrants? a) pet food makers b) coffee shop c) airline jet manufacturer d) delicatessen e) auto parts supplier

c) airline jet manufacturer

In a scandal at Tyco, shareholders sued the _____ for negligence in failing to monitor properly. a) employees b) owners c) board of directors d) culture e) suppliers

c) board of directors - oversee the general management of the firm to ensure that is it being run in away that best serves the stockholders' interests

Which of the following buyers would have the greatest ability to influence suppliers? a) A student ordering a pizza b) A student selecting a college or university c) A department store influencing fashion designers d) Government negotiating the purchase of a helicopter for its army e) Homemaker buying groceries at the supermarket

d) Government negotiating the purchase of a helicopter for its army

_____ is a key part of the manager's job. a) Understanding the organizational hierarchy b) Authoritarianism c) Being manipulative d) Maintaining an effective alignment between the organization and the environment e) Being cognizant of the environment in which his or her supervisors operate

d) Maintaining an effective alignment between the organization and the environment

Chelsea Lumber Company has very low turnover, and the employees are frequently seen volunteering in the community. This suggests a(n) _____ where employees and the communities are highly valued. a) atmosphere b) task environnemental c) external environmental d) physical work environment e) culture

e) culture - determines the overall "feel" of the organization

State supported universities receive money from state tax payers. Harvard University's endowment is so large Harvard is guaranteed significant income just from the interest the fund generates. The _____ dimension of these competitors is different. a) legal b) sociocultural c) technological d) political e) economic

e) economic

The internal processes approach to organizational effectiveness is most closely related to the _____ part of an organizational system. a) inputs b) entropy c) outputs d) feedback e) transformation

e) transformation - minimizing strain, integrating individuals and the organization, and conducting smooth and efficient operation

Fast food chains make headlines when someone claims to find body parts or foreign objects in their food. The claims are usually false, but they increase the industry's... a) environmental turbulence b) environmental homogeneity c) competitive rivalry d) threat of new entrants e) boundary spanning

a) environmental turbulence

Blogs are used by companies to post customer feedback. This is a method of environmental scanning and... a) information management b) strategic response c) direct influence d) organic organization design e) organization culture modification

a) information management

Jorge is responsible for his department's diversity initiative. He will have to operate in the _____ environment. a) internal b) political-legal c) task d) general e) economic

a) internal

The _____ approach to organizational effectiveness is most closely related to the feedback part of the systems model. a) strategic constituencies b) internal processes c) goal d) systems e) systems resource

a) strategic constituencies - focuses on the groups that have a stake in the organization

The organizational effectiveness model that focuses on getting materials it needs when it needs them is which of the following? a) systems research approach b) internal processes approach c) goal approach d) strategic constituencies approach e) achieving effectiveness approach

a) systems research approach

The level of _____ faced by organizations is determined by the degree of homogeneity and the degree of change in their environments. a) uncertainty b) environmental turbulence c) complexity d) competitive forces e) tangibility

a) uncertainty - unpredictability created by environmental changed and complexity

The organizational effectiveness model that focuses on minimizing strain, integrating individuals and the organization, and conducting smooth and efficient operations is which of the following? a) systems research approach b) internal processes approach c) goal approach d) strategic constituencies approach e) achieving effectiveness approach

b) internal processes approach

Massachusetts's healthcare system shifts the responsibility for insurance from employer to individuals. This is an example of the _____ dimension. a) internal b) political-legal c) task d) sociocultural e) economic

b) political-legal - the extent of government regulation of business and the general relationship between business and government

During some surgeries, a technician in the operating room tweets updates so loved one know how it is going. This is an example of the _____ dimension of the general environment a) legal b) sociocultural c) technological d) political e) economic

b) sociocultural - the customs, morals, values, and demographic characteristics of the society in which the organization functions

A manufacturer of recyclable plastic containers is operating in an environment that is relatively free of uncertainty. This means that the manufacturer is operating in a _____ environment. a) complex and stable b) stable and simple c) simple and homogeneous d) stable and dynamic e) homogeneous and dynamic

b) stable and simple

The LEAST environmental uncertainty is faced by organizations with a _____ environment. a) complex and stable b) stable and simple c) simple and homogeneous d) stable and dynamic e) homogeneous and dynamic

b) stable and simple

In Florida a vacationer could chose from over 200 time-share resorts. In Vermont the choice is limited to 15. A resort in Vermont has... a) the power of buyers b) the power of suppliers c) the threat of new entrants d) competitive rivalry e) the competitive advantage

b) the power of suppliers

Which of the following is a reason that virtually every organization is affected by the international dimension? a) A flexible currency exchange rate b) A large number of people emigrating from their homelands to other parts of the world c) Advances in transportation and communication technology d) Political unrest in various countries e) The expansion of workforces

c) Advances in transportation and communication technology

The task environment is more specific than the general environment. It includes all EXCEPT... a) customers b) suppliers c) boards of directors d) strategic partners e) regulators

c) boards of directors - internal environment

National Industries, supplier to all Hometown Hardware Stores, manufactures many of the products it sells to member stores. What kind of response to the organizational environment does this represent? a) social responsibility b) internal c) direct influence d) an organic organization design e) an organization culture modification

c) direct influence

A company that increases sales by 20% and profits by 15% would be considered effective by the... a) systems research approach b) internal processes approach c) goal approach d) strategic constituencies approach e) achieving effectiveness approach

c) goal approach

At 3M, researchers are encouraged to generate a significant part of the company's income from new product development. The mangers are evaluated on the degree to which they meet this standard. What model of organizational effectiveness does this represent? a) systems research approach b) internal processes approach c) goal approach d) strategic constituencies approach e) achieving effectiveness approach

c) goal approach

Mother's Against Drunk Driving is an interest group that exerts influence on some industries. It is an example of the _____ component. a) owner b) partners c) regulator d) competitors e) economic

c) regulator - control, legislate, or influence the organization's policies or practices; regulator agencies and interest groups

McDonald's added high-speed Internet access to a few restaurants in the San Franscisco area. McDonald's was responding to changes in the _____ environmental dimension. a) economic b) technical c) sociocultural d) political-legal e) domestic

c) sociocultural - the customs, morals, values, and demographic characteristics of the society in which the organization functions

Outside members of the board of directors are usually chosen... a) because they represent part of the organization's general environment b) to reduce the requirement for inside directors who come from the same industry c) to provide a particular expertise d) to reduce scrutiny by government agencies e) to preclude the conflicts of interest that could arise if top managers from the organization were selected

c) to provide a particular expertise

For a state-supported college, students may be considered part of the _____ dimension of the task environment. a) suppliers b) strategic allies c) competitors d) customers e) regulators

d) customers - acquire an organization's products or resources

Which of the following is an example of an organization's response to its external environment? a) negotiating a new contract with the union b) hiring a new CEO c) implementing new plant safety standards d) doing nothing in response to a competitor's new product e) modifying the organization's culture

d) doing nothing in response to a competitor's new product

Which of the following organizations would be MOST likely to face a dynamic/complex environment? a) Friendly's b) Michigan State University c) Whirlpool d) eBay e) JCPenny

d) eBay

Workers who purchase company stock have a dual role in the internal environment as... a) employees, board of directors b) shareholders, board of directors c) shareholders, strategic partners d) employees, owners e) monitors, owners

d) employees, owners owners - persons with legal property rights to a business

Many organizations now have units that monitor a host of magazines and newspapers looking for stories that may have an impact on the organization. These units are... a) a form of management information system b) engaged in boundary spanning c) a type of organization control d) engaged in environmental scanning e) engaged in strategic planning

d) engaged in environmental scanning - actively monitoring the environment through activities such as observation and reading

The degree of _____ is the extent to which the organizational environment is relatively simple or complex. a) change b) uncertainty c) environmental turbulence d) homogeneity e) tangibility

d) homogeneity

An organization design that is mechanistic... a) operates in an uncertain environment b) uses few standard operating procedures c) gives its managers considerable discretionary decision-making power d) is characterized by formal and rigid relationships e) none of the above

d) is characterized by formal and rigid relationships

One of the reasons so many Internet companies fail is due to a lack of standardized operating procedures. The companies' managements are afraid of stifling their creative employees by using a rigid structure with lots of rules and regulations. Instead employees are given few rules and allowed to use their own judgement when making decisions. What type of organization design would you find in most of these companies? a) mechanistic b) autocratic c) bureaucratic d) organic e) formalized

d) organic - considerably more flexible and permits the organization to respond quickly to environmental change

Which of the following is ultimately related to how well an organization understands, reacts to, and influences its environment? a) Influence b) Admiration c) Efficiency d) Reactivity e) Effectiveness

e) Effectiveness

What do a market research firm, Kelly Temporary Services, BusinessWeek magazine, and Citicorp Bank all have in common? a) They are all part of the sociocultural dimension of the task environment b) They are all part of the general environment c) They are all kinds of regulators d) They are all examples of interest groups e) They are all suppliers

e) They are all suppliers - provide resources for the organization

An organization's general environment... a) includes a set of broad dimensions b) includes forces in its surroundings c) refers to the overall context of the environment d) is not necessarily associated with specific organizations e) all of the above

e) all of the above

The internal environment of a corporation consists of... a) a board of directors b) the physical work environment c) employees d) the investors in the business e) all of the above

e) all of the above