Deck 11: Designing Organizations

Question 1

According to the "Chapter 11 Challenge of Managing,"Lowe's is the leader in number of home improvement stores and sales.

Answer 1

False

Question 2

Lowe's wants to attract more baby boomers who want less hassle, one-stop shopping, and someone they can trust to help with home improvement projects.

Answer 2

True

Question 3

Organizational design is the formal system of working relations that separates and gathers tasks.

Answer 3

False

Question 4

An organizational unit could refer to both teams and divisions.

Question 5

Each box on an organizational chart represents different units.

Question 6

Organizational levels can be counted simply by the number of horizontal layers in the organizational chart.

Question 7

An organizational chart, in general, gives some insight into how the entire organization fits together.

Question 8

Aisha Pujadas can review the organizational chart of her company ViewCast to detect gaps in authority or duplication of tasks.

Question 9

Owen Nalle wants to know which individual employed at Cargo Capital Trust has the most political influence. Nalle will be able to rely on the firm's organizational chart to identify that person.

Question 10

An organizational chart is a picture that does not show how things really get done in the organization.

Question 11

There are two fundamental concepts around which all organizations are organized: differentiation and integration.

Question 12

Rules and procedures are aspects of integration.

Question 13

Differentiation means that workers are considered to be on a different organization level than management.

Question 14

Integration of organizational parts is one way to avoid the need for coordination.

Question 15

Having more hierarchical levels permits more people to participate in the decision-making processes.

Question 16

Many organizations, like Farmers Insurance, have reduced the number of hierarchical levels in their organization by decreasing the number of management layers between the CEO and front-line employees to create a more efficient organization.

Question 17

A hierarchy is a circular diagram showing top management at the center and the lowest level employees around the outside.

Question 18

The number of subordinates that a manager can supervise refers to span of operation.

Question 19

The less a manager knows about potential new operating problems in their department, the wider their span of control should be.

Question 20

Authority is the glue that holds the vertical and horizontal parts of an organization together.

Question 21

The expectation that an employee will accept credit or blame for results achieved in performing assigned tasks is called authority.

Question 22

Oftentimes, a manager makes an employee responsible to perform a task, but does not give the person sufficient authority to get the job done.

Question 23

In May 2006 a jury acquitted Jeffrey Skilling and Ken Lay on many counts of fraud and unethical behavior related to Enron.

Question 24

One of the barriers to delegation is when authority and responsibility have not been defined clearly.

Question 25

American Standard, based in the United States and specializing in the manufacture and sale of plumbing fixtures, air conditioners, and bath fixtures, used its communication competency when it invested in Bulgaria.

Question 26

American Standard has created strong ties with its unions, employees, and other workers in Bulgaria.

Question 27

Neither centralization nor decentralization is absolute in an organization.

Question 28

Centralization is the concentration of authority at the top of an organization or department.

Question 29

Subordinates may make better decisions than managers because they have a better grasp of the facts.

Question 30

Uniform policies are a characteristic of centralized organizations.

Question 31

Cost may be the least important factor in determining the extent of centralization.

Question 32

In order to help Kate Spade run more effectively, Kate and Andy Spade had to be clear about job definition.

Question 33

Kate Spade has more than 200 stores in the United States and 29 in Asia.

Question 34

Harley-Davidson has chosen a geographic design to capitalize on regional differences in its 1,300 dealers who sell 28 different models of motorcycles.

Question 35

Grouping tasks and employees by function can be both cost effective and efficient.

Question 36

Kris Kringle uses a functional design for his toymaking operation. This organizational structure may increase career development because each elf trains within their functional area to improve his or her specialized skills.

Question 37

Inadequate communication between units is a potential pitfall of the functional design.

Question 38

Organizations such as Nestlé, Sheraton Hotels, and Celanese Chemical use product departmentalization in part because they have worldwide operations.

Question 39

In the product design, all functions for a particular product are organized under one manager.

Question 40

Coordination is usually simplified across product lines because employees tend to focus on broader company goals rather than on goals for their particular product.

Question 41

Geographic design allows an organization to focus on customer needs within a relatively small geographic area and to minimize the costs associated with transportation of goods or services.

Question 42

Most of an organization's functional departments must be duplicated at each location when using geographical design.

Question 43

The movie industry is an example where firms use a network design.

Question 44

Because network designs work in real time, a postponement in one part of the process has ripple effects throughout the system.

Question 45

DreamWorks has produced movies such as The Fox and the Hound, Robin Hood, and Peter Pan.

Question 46

At DreamWorks, senior managers divide their responsibilities by geography.

Question 47

Organizational diversification is one of the basic elements of organizing.

Question 48

A mechanistic system is most appropriate when an organization's environment is stable and predictable.

Question 49

In the New York City Police Department (NYPD), officers perform highly specialized tasks and decision making is highly centralized. This suggests that the NYPD has a mechanistic organization design.

Question 50

An organic system places less emphasis on standardized rules than a mechanistic system.

Question 51

Michael Marks, chairman of Flextronics International, has used many of the ideas of a mechanistic system to create a very successful company.

Question 52

At Flextronics International, Michael Marks doesn't want to tie down his top managers with bureaucracy, which thereby allows managers the flexibility to solve problems without going through a lot of red tape.

Question 53

An organization's need for coordination has a significant impact on how managers pull together the organization's various activities because of the requirement for technological interdependence.

Question 54

An automobile assembly line is an example of horizontal interdependence.

Question 55

At the Acme Manufacturing Co., the output from department A becomes the input for department B, the output from department B becomes the input for department C. This illustrates sequential interdependence.

Question 56

With reciprocal interdependence, the flow of information between individuals within the same department or between departments is serialized.

Question 57

Hospital emergency rooms typically operate with reciprocal interdependence.

Question 58

Designing an organization to handle reciprocal interdependence and then managing it are extremely challenging tasks.

Question 59

To improve its geographic presence, Lowe's purchased a 38-store chain, _____________.

A) Ace Hardware
B) Canyon Hardware and Home
C) Eagle Hardware and Garden
D) Restoration Hardware

Question 60

Lowe's is trying to take advantage of major trends which relate to its organization design and its vision and mission. Those trends include all of the following except:

A) putting an emphasis on installation services
B) meeting retirees to establish relationships
C) appealing to urban customers
D) keeping the professional home builder as a customer

Question 61

Organizational design is __________.

A) a diagram that illustrates the reporting lines between people in an organization
B) the skeleton of an organization
C) creative planning by owners and top management
D) the decisions and actions that result in a structure

Question 62

Martha De La Cruz is the president of Secure Systems, Inc. De La Cruz is in the process of making decisions that will put jobs and relationships into a structure. De La Cruz is creating a(n) __________.

A) task structure
B) organizational structure
C) business plan
D) organizational design

Question 63

An __________ is a diagram that illustrates the reporting lines between units and people within the organization.

A) organizational chart
B) organization structure
C) organizational design
D) organization creation

Question 64

An organizational chart provides the skeletal snapshots of an organization's structure and includes all of the following except __________.

A) titles
B) levels of organization
C) reporting relationships
D) compensation

Question 65

When Jesus Martinez reviews the organization chart for his company, he can obtain all of the following pieces of information except the __________ in the firm.

A) compensation structure
B) lines of authority
C) subdivisions of tasks
D) political influence

Question 66

Kyle Oates is looking at the organizational chart for Trinity Industries. Oates can expect that it might give him all of the following information except __________.

A) insight into how the entire organization fits together
B) cities where people are located
C) who reports to whom
D) gaps or duplication of activities

Question 67

Managers frequently are able to describe the structure of their organization with __________.

A) the financial statements
B) an organizational chart
C) a horizontal design
D) a vertical design

Question 68

One of the advantages of organization charts is that __________.

A) the chart reveals vital informational channels of communication
B) the chart shows political influence
C) the chart shows employees how the pieces of the entire organization are intended to fit together
D) power and status are reflected by a position's proximity to the CEO

Question 69

One of the disadvantages of an organization chart is that the chart __________.

A) doesn't show how things really get done in an organization
B) shows employees how the pieces of the entire organization fit together
C) is rigid and never changes
D) can help management detect gaps in authority or duplication of tasks

Question 70

__________ means that the work of the organization is divided into smaller tasks.

A) Task division
B) Specialization
C) Integration
D) Division of labor

Question 71

There are two fundamental concepts around which all organizations are organized: __________.

A) labor and technology
B) differentiation and integration
C) authority and delegation
D) hierarchy and span of control

Question 72

Uniqueness of tasks and specialization of workers creates a need for __________.

A) socialization
B) integration
C) differentiation
D) delegation

Question 73

The process of identifying particular tasks and assigning them to departments, teams, or divisions is __________.

A) specialization
B) coordination
C) standardization
D) unity of command

Question 74

Some degree of coordination is necessary among business units in order for the organization to be effective. This is known as __________.

A) regulation
B) integration
C) standardization
D) uniformity

Question 75

One of the elements of organizational structure that involves the separation of tasks is __________.

A) delegation
B) assignment
C) specialization
D) structure

Question 76

Lance Lackey is a supervisor in the CAS (Customer Account Services) unit of the IRS. He is responsible for taxpayer relationship having to do with filing, including processing submissions and payments. Lackey's job represents the __________ element of organizational design.

A) specialization
B) human resources
C) assignment
D) enrichment

Question 77

Jonathan Flowers is a structural engineer for Halliburton. A job foreman asked Flowers about the heat and air equipment being delivered to the site but Flowers knew nothing about it because Halliburton is complex and requires a high level of __________.

A) delegation
B) specialization
C) integration
D) hierarchy

Question 78

The __________ is a pyramid showing relationships among levels.

A) business plan
B) organizational chart
C) task structure
D) hierarchy

Question 79

During the past few years, many U.S. companies have __________ the number of hierarchical levels in their organizations.

A) held constant
B) reduced
C) eliminated
D) increased

Question 80

Executives hope that fewer organizational levels will create all of the following benefits except __________.

A) better control of subordinates
B) faster reaction to competition
C) hearing "bad" news more frequently and quickly
D) more cost effectiveness