Understanding Business Chapter 8 (63 terms)

match the flexibility of small firms

A large organization might use a flat organization structure in order to

Centralized Authority (organization)

An organization structure in which decision-making authority is maintained at the top level of management at the company's headquarters.

Max Weber

Principles of Bureaucracy

Chain of Command

The line of authority that moves from the top of a hierarchy to the lowest level.

Informal Organization

The system that develops spontaneously as employees meet and form cliques, relationships, and lines of authority outside the formal organization; that is, the human side of the organization that does not appear on any organization chart.

True or false: Networking uses technology, such as a company intranet, to link organizations and their suppliers to allow them to work together for a common goal.

True

Regardless of the size of the organization, the principles of organizing include:

a hierarchy of authority dividing up the tasks to be done deciding what work needs to be done

A cross-functional team that is working on the development of a new prosthetic device for amputees should include:

amputees who will use it parts suppliers for medical devices product designers

The rapidly evolving business environment requires the management of _____________________________in the organization to respond to it.

change

Organizations reorganized to empower frontline workers so that they:

could more efficiently and effectively serve customers

Line managers are those who have the authority to:

issue orders adjust to changing conditions enforce discipline

structure an organization (4 ways)

line line & staff matrix style cross functional, self managed teams

When a firm assigns one or more of its functions to an outside organization, it is:

outsourcing

When designing responsive organizations, what decisions do firms have to make?

Decide between centralization versus decentralization Decide the span of control Choose between tall or flat structures

mass production

Process of making large quantities of a product quickly and cheaply Innovations like the mass production of cars can create economies of scale. However, over time this benefit becomes less meaningful because: other companies copy the process mass production, the cost of building each car declined.

line

Production workers, distribution people, and marketing personnel who are responsible for directly achieving organizational goals are called __________________ personnel.

Restructuring

Redesigning an organization so that it can more effectively and efficiently serve its customers.

Real Time

The present moment or the actual time in which something takes place

Economies of Scale

The situation in which companies can reduce their production costs if they can purchase raw materials in bulk; the average cost of goods goes down as production levels increase.

Networking

Using communications technology and other means to link organizations and allow them to work together on common objectives.

Digital Natives

Young people who have grown up using the Internet and social networking.

Less need for policy manuals, organization charts, and formal controls is a sign of shared values in a:

corporate culture that emphasizes service to others

Organizations reorganize to empower frontline workers to:

demonstrate appreciation and trust to frontline workers let them know they are valuable assets to the organization serve customers more efficiently and effectively

Many organizations have reorganized to make workers their most important people.

frontline

Boundaries

A cross-functional team that includes suppliers, distributors, and customers goes beyond organizational

Hierarchy

A system in which one person is at the top of the organization and there is a ranked or sequential ordering from the top down of managers who are responsible to that person.

Virtual Corporation (organization)

A temporary networked organization made up of replaceable firms that join and leave as needed.

Matrix Organization

An organization in which specialists from different parts of the organization are brought together to work on specific projects but still remain part of a line-and-staff structure. In a _________________ project managers are in charge of teams made up of members from several departments.

Decentralized Authority (organization)

An organization structure in which decision-making authority is delegated to lower-level managers more familiar with local conditions than headquarters management could be.

Flat Organization Structure

An organization structure that has few layers of management and a broad span of control. organization structures respond to customer demands faster because its lower-level employees have authority and responsibility for making decisions.

Inverted Organization

An organization that has contact people at the top and the chief executive officer at the bottom of the organization chart.

Line Organization

An organization that has direct two-way lines of responsibility, authority, and communication running from the top to the bottom of the organization, with all people reporting to only one supervisor.

Bureaucracy

An organization with many layers of managers who set rules and regulations and oversee all decisions.

Tall Organization Structure

An organizational structure in which the pyramidal organization chart would be quite tall because of the various levels of management.

Benchmarking

Comparing an organization's practices, processes, and products against the world's best.

Why is adapting to change one of the hardest challenges facing any manager?

Employees and managers are sometimes resistant to change.

change

Employees at all levels often resist _________ because they are used to doing their jobs in ways they know.

Staff Personnel

Employees who advise and assist line personnel in meeting their goals.

Line Personnel

Employees who are part of the chain of command that is responsible for achieving organizational goals.

hybrid (departmentalization techniques)

Firms may use a combination of departmentalization techniques to create a ____ form.

cross-functional self-managed teams

Groups of employees from different departments who work together on a long-term basis and are empowered to make decisions without management approval are used in organizations to break down barriers between functional departments

Cross-Functional Self-Managed Teams

Groups of employees from different departments who work together on a long-term basis.

Principles of Bureaucracy

Job descriptions - written rules, decision guidelines & detailed records consistent procedures, regulations & policies staffing and promotion based on qualifications brought consistent application of rules and procedures to organizations were proposed by Max Weber

Departmentalization

The dividing of organizational functions into separate units.

Span of Control

The optimum number of subordinates a manager supervises or should supervise. An important decision to be made while designing a responsive organization organizations adopt empowerment, reduce the number of middle managers, and hire more talented and better educated lower-level employees the trend today is to EXPAND the span of control.

Formal Organization

The structure that details lines of responsibility, authority, and position; that is, the structure shown on organization charts (design)

Core Competencies (Compentency)

Those functions that the organization can do as well as or better than any other organization in the world. Nike's strength is in designing and marketing athletic shoes and Apple's is in marketing innovative electronics. These are examples of each company's: Nike sells golf clubs, swim wear, as well as footballs. However, Nike is best known for its performance in designing and marketing of athletic shoes.

Organizational (or corporate) Culture

Widely shared values within an organization that provide unity and cooperation to achieve common goals.

Managing _________________________________ has become a critical managerial function because the increasing rate of change affects all organizations.

change

The result of the increase in the rate of change in the business environment from causes such as natural disasters and global competition has been that companies must:

change more quickly than ever beforeadapt to new technologies

Once managers determine what work needs to be done, they then need to divide up the tasks among workers. This is called of ._______________ ______ ____________________

division of labor

Once the department manager determines the work that needs to be done, the next step is dividing the tasks among department employees. This step is known as:

division of labor

By developing _______________ ______________________ __________________ , a company can reduce its production costs if it can purchase raw materials in bulk; the average cost of goods goes down as production levels increase.

economies of scale

Remaining ______ is the key to an organization's success in changing times.

flexible

A firm that has a marketing department organized geographically and a production process organized by function has which type of departmental structure?

hybrid

principles of organization

organizing (structuring) - determining what work needs to be done division of labor - dividing up the tasks job specialization - dividing tasks into smaller jobs departmentalization - set up idivid department Regardless of the business size the principles are similar.

A local furniture company launched a website to boost national sales. However, it could not ship the orders efficiently so it started using FedEx and UPS. This is an example of________________ .

outsourcing

Advantages of a positive corporate culture include:

people who enjoy working together to be productive trust between employees emphasizing service to others, especially customers

hybrid or combinations organization structures

sales department has geographic departments, production is organized by function, and marketing is organized by customer groups.

managers

staff production line - Those directly responsible for achieving the organization's production goals by issuing orders and enforcing discipline top

When businesses evolved into larger organizations producing larger amounts of product more efficiently using mass production methods, it could be said that:

the bigger the plant, the more efficient production became

A productive corporate culture is one where there is mutual

trust

Henri Fayol's principles for organization structure

unity of command - worker reports to only one boss, so you prevent confusion hierarchy of authority - all workers should know to whom they report division of labor - Functions being divided into areas of specialization such as production, marketing, and finance subordination of individual interests - must work as a team (believes that workers are to think of themselves as a coordinated team) authority - degree of centralization - the amount of decision-making power vested in top management should vary by circumstances. clear communication channels order - materials and people should be placed and maintained in the proper location: equity - treat employees with respect and justice esprit de corps - a spirit of pride