Deck 9: Organization Size, Life Cycle, and Decline

Question 1

During the ____ stage, the organization begins to develop clear goals and direction.

A) entrepreneurial
B) elaboration
C) formalization
D) collectivity

Answer 1

D

Question 2

Which of the following is not a dimension of bureaucracy that Weber envisioned as desirable?

A) Rules and procedures
B) Specialization and division of labor
C) Hierarchy of authority
D) Trained employees

Answer 2

D

Question 3

____ percent of businesses that make it past the first year still fail within five years because they can't make the transition from the entrepreneurial stage.

A) Ten
B) Twenty-three
C) Fifty-two
D) Eighty-four

Answer 3

D

Question 4

Rules and standard procedures as developed by Weber were to:

A) help managers get tough with lazy employees.
B) keep managers in their positions of control and power.
C) enable activities to be performed in a predictable and routine manner.
D) punish anyone who got out of line.

Question 5

High formalization is most closely associated with which of the following?

A) Organic structure
B) Small size
C) Large size
D) Responsive style

Question 6

Tyler Jones is the CEO of a medium-sized manufacturer of bedding and blankets. Tyler insists on making all decisions as to styles that are manufactured, the type of material that will be used in each, the sources from whom the company will purchase yard goods, thread, and buttons, and the shippers the company will use. Which of the following terms describes this company?

A) Elaboration stage
B) Centralization
C) Formalization
D) Standardization

Question 7

Crucial argument for success in a global economy are:

A) vertical hierarchy mechanistic structure
B) responsiveness and flexibility
C) economies of scale and complex structure
D) organization finding and developing a stable market

Question 8

Research on personnel ratios has found that:

A) clerical and professional support staff ratios decrease in proportion to organization size.
B) small organizations are very inefficient because direct workers as a percent of total employees is so low.
C) personnel ratios for professional support staff are higher in small firms than in large firms.
D) there is a lowered administrative ratio in large firms.

Question 9

Departments emerge and are established, along with a beginning division of labor, in a newly established hierarchy at which stage in the life cycle?

A) Entrepreneurial
B) Formalization
C) Collectivity
D) Elaboration

Question 10

Apple was in the ____ stage when it was created by Steve Jobs and Stephen Wozniak in Wozniak's parents' garage.

A) collectivity
B) entrepreneurial
C) formalization
D) elaboration

Question 11

Max Weber developed the concept of a bureaucracy to make organizations:

A) more rational and efficient.
B) more empathetic.
C) less formal.
D) quicker to respond to stakeholders.

Question 12

A primary reason identified for the organizational design success of United Parcel Service was:

A) its organic structure enables it to operate more efficiently than the bureaucratic U.S. Postal Service.
B) its adoption of the bureaucratic model.
C) that it doesn't have many rules or formalized procedures and thus can be more innovative.
D) it hires primarily college students who are the best employees possible.

Question 13

There are an estimated ____ small businesses in the United States.

A) 3 to 4 billion
B) 25 to 26 million
C) 5 to 6 million
D) 34 to 35 million

Question 14

What is the major goal of an organization during the entrepreneurial stage of the life cycle?

A) Growth
B) Goal-setting
C) Survival
D) Complete organizational structure

Question 15

Small organizations are characterized by which of these?

A) Mechanistic
B) Complex
C) Global reach
D) Niche finding

Question 16

Large organizations are characterized by all of these except:

A) vertical hierarchy
B) complex
C) economies of scale
D) niche finding

Question 17

Organizations going through the life cycle:

A) usually reach elaboration in 12-18 months.
B) tend to become very bureaucratic by the collectivity stage.
C) usually resolve crises associated with each stage, or face restricted growth.
D) tend to experience their wildest and most rapid growth period in the formalization stage.

Question 18

Which of the following characterizes the formalization stage of the life cycle?

A) More formal and less frequent communication
B) Top management concern with planning and strategy
C) Incentive system based on profits is implemented for managers
D) All of these

Question 19

In contrast to large businesses, small business is characterized by:

A) constituting a large percentage of all exporters.
B) decreasing percentage of employees in the economy as a whole.
C) fewer numbers, as merger mania continues to create a larger proportion of large firms in the world economy.
D) the front/back combinations that combine small units into larger ones.

Question 20

What type of top management style does a bureaucratic organization in the formalization stage possess?

A) Team approach
B) Delegation with control
C) Individualistic
D) Charismatic

Question 21

When downsizing, all of the following can help smooth the downsizing process and ease tensions for employees who leave and remain except:

A) help the survivors thrive.
B) communicate more, not less.
C) provide assistance to displaced workers.
D) let workers deal with the situation on their own and in their own ways.

Question 22

Despite the increasing size of many companies, the economic vitality of the U.S. is tied to small and midsize businesses.

Question 23

The use of ____ control requires that outputs be sufficiently explicit for a price to be assigned and that competition exist.

A) bureaucratic
B) clan
C) traditional
D) market

Question 24

____ is the use of social characteristics, such as shared values, commitment, traditions, and beliefs, to control behavior.

A) Market control
B) Clan control
C) Traditional control
D) Bureaucratic control

Question 25

In the ____ stage, denial occurs despite signs of deteriorating performance.

A) blinded
B) inaction
C) faulty action
D) crisis

Question 26

A form of organization called ____ has emerged that is made up completely of professionals.

A) incident commanders
B) clan members
C) formal collaborations
D) professional partnerships

Question 27

All of the following are factors that cause organizational decline except:

A) vulnerability.
B) increased product prices.
C) environmental decline or competition.
D) organizational atrophy.

Question 28

Large size enables companies to take risks that could ruin smaller firms, and scale is crucial to economic health in some industries.

Question 29

Which of the following is not a type of authority that could explain the creation and control of a large corporation?

A) Charismatic authority
B) Rational-legal authority
C) Traditional authority
D) Competitive authority

Question 30

Carson is the manager of Cutter's Consulting, a consulting company composed of professionals from different fields. In such a company, Carson would be wise to:

A) bring the organization immediately into revitalization.
B) have little formalization.
C) use as much authority as much as possible.
D) discourage horizontal communication because it violates the chain of command.

Question 31

Which of the following is not one of the organizational control strategies?

A) Technical
B) Clan
C) Market
D) Bureaucracy

Question 32

Which of the following is the use of rules, policies, hierarchy of authority, written documentation, standardization, and other bureaucratic mechanisms to standardize behavior and assess performance?

A) Market control
B) Bureaucratic control
C) Traditional control
D) Clan control

Question 33

In which stage the organization faces serious problems, and indicators of poor performance cannot be ignored?

A) Faulty action
B) Dissolution stage
C) Blinded
D) Crisis stage

Question 34

Clan control is most often used in:

A) small, informal organizations or in organizations with a strong culture.
B) small, formal organizations or in organizations with a weak culture.
C) large, informal organizations or in organizations with a weak culture.
D) large, formal organizations or in organizations with a strong culture.

Question 35

More than one type of authority may exist in organizations, but ____ authority is the most widely used form to govern internal work activities and decision making, particularly in large organizations.

A) Traditional
B) Charismatic
C) Appointed
D) Rational-legal

Question 36

The primary reason that the CEO of a large company such as McDonald's would push decisions as far down the hierarchy as he can is to:

A) develop managers.
B) make decisions more quickly.
C) appear more American and thereby increase sales.
D) save himself the trouble of making these decisions.

Question 37

A condition in which a substantial, absolute decrease in an organization's resource base occurs over a period of time is referred to as:

A) market control.
B) bureaucracy.
C) organizational decline.
D) centralization.

Question 38

____ authority is based on devotion to the exemplary character or to the heroism of an individual person and the order defined by him or her.

A) Rational-legal
B) Traditional
C) Charismatic
D) Informal

Question 39

Small companies are standardized, often mechanistically run, and complex.

Question 40

Which of the following is the first stage of decline?

A) Blinded
B) Dissolution
C) Inaction
D) Faulty action

Question 41

The life cycle phenomenon is a powerful concept used for understanding problems facing organizations and how managers can respond in a positive way to move an organization to the next stage.

Question 42

Weber's prediction of the triumph of bureaucracy proved accurate.

Question 43

Increased training can substitute for bureaucratic rules and procedures.

Question 44

Weber believed that a well-managed bureaucracy would ensure efficient organizational functioning in both government and business settings.

Question 45

In the collectivity stage, departments are established along with a hierarchy of authority, job assignments, and a beginning division of labor.

Question 46

Clan control is generally used by companies that are small and informal or have a strong culture.

Question 47

In the elaboration stage, an organization's growth is rapid, and employees are excited and committed to the organization's mission.

Question 48

The following organization is in its collectivity stage: Employees at Ace identify with the company mission and goals, and they typically put in 55-hour workweeks. Ace is established in the marketplace, and is concentrating on getting more and more dealers to sign on. Ace does not have a written policies and procedures manual for its own employees.

Question 49

Formalization refers to rules, procedures, and written documents that prescribe the rights and duties of employees.

Question 50

As organizations become larger, a smaller percentage of technical and professional support staff is recommended.

Question 51

Traditional authority refers to control coming from exemplary character of an individual and the aura he or she creates.

Question 52

As organizations become larger, greater centralization is necessary.

Question 53

The elaboration stage involves the installation and use of rules, procedures, and control systems.

Question 54

In a large company going through the organizational life cycle, the replacement of top management may occur in its elaboration stage as it struggles to revitalize.

Question 55

The bureaucratic control system was developed to maintain the efficiency and control benefits of bureaucracy yet prevent the problem of slow response to crises.

Question 56

There are ten stages of life cycle development that an organization must generally go through in order to reach the final stage when rewards are personal and aimed at those who contribute to organizational success.

Question 57

Market control occurs when price competition is used to evaluate the output and productivity of an organization or its major departments and divisions.

Question 58

As organizations become larger, a larger percentage of top administrators is necessary.

Question 59

As organizations increase in size, the net effect for direct workers is that they decline as a percentage of total employees.

Question 60

Ninety-nine percent of businesses that make it past the first year still fail within five years because they can't make the transition from the entrepreneurial stage.

Question 61

How should personnel ratios be managed in a small firm?

Question 62

Market control is most frequently used in the control of functional departments.

Question 63

Compare and contrast the three types of organizational control strategies.

Question 64

Describe Weber's dimensions of bureaucracy and bases of organizational authority.

Question 65

Discuss each stage of the life cycle.

Question 66

Describe Weber's three types of authority that explains the creation and control of larger organizations.

Question 67

Explain the relationship between organizational size and at least three specific structural characteristics.

Question 68

Government organizations often seem to be more bureaucratic than for-profit organizations such as the Ansel Adams Gallery, a family business that markets beautiful photography of the Sierras. Could this partly be the result of the type of control used in the respective organizations? Explain.

Question 69

Discuss how an organization can help smooth the downsizing process and ease tensions for employees who leave and remain.

Question 70

Is bigger organization size better? Whether you say yes or no, defend your answer. Then explain the countering or opposite position, trying to make it as convincing an argument as you can.

Question 71

Describe the differences between large and small organizations.

Question 72

Communicating more, not less, providing assistance to displaced workers, and help the survivors thrive are three ways for organizations to deal with downsizing.

Question 73

Discuss the causes for organizational decline. List and define the stages of organizational decline.

Question 74

Describe the life cycle of a specific organization that has gone through at least three stages of the organizational life cycle. In your answer explain the crisis this organization is now facing, and how you would recommend that it overcome its crisis.

Question 75

Discuss the approaches to reducing bureaucracy.
.

Question 76

Explain the patterns found in the study of personnel ratios for administrative, clerical, and professional support staff.

Question 77

The manager of an established small manufacturing plant said, "We can't compete with large organizations because they have the advantage of economies of scale." Draw from the chapter on organization size to discuss his position, explaining any factors that might counter his position to some extent. How should he manage in order to take advantage of the firm's small size?

Question 78

Why would a large organization tend to be more formalized?

Question 79

If Max Weber were living in the United States today, and observing the push away from bureaucracy, what do you think he would say? Would he defend the use of bureaucracy today, or are there different environmental factors that would cause him to abandon bureaucracy?

Question 80

Describe the organizational characteristics associated with each stage of the life cycle.