Deck 10: Organizational Design

Question 1

The degree to which activities in an organization are divided into separate jobs is called work specialization.

Answer 1

True

Question 2

All other things unchanged, the narrower the span of control, the more efficient the organization is.

Answer 2

False

Question 3

The trend in recent years has been toward smaller spans of control, which are consistent with managers' efforts to reduce costs and increase flexibility.

Answer 3

False

Question 4

When cosmetics maker Estée Lauder organized its structure around its major brands, and operated each as a separate company, it was using product departmentalization.

Question 5

Given that other things remain unchanged, managers with well-trained and experienced employees can function well with a wider span of control than those with a less talented workforce.

Question 6

The chain of command is a principle that states that a person should report to only one boss.

Question 7

A cross-functional team is a group of individuals who are experts in various specialties and who work together.

Question 8

Formalization refers to the degree to which jobs within the organization are standardized and the extent to which employee behaviour is guided by rules and procedures.

Question 9

Customer departmentalization groups jobs on the basis of product or customer flow.

Question 10

The formal arrangement of jobs within an organization is called organizational design.

Question 11

Employee empowerment gives employees more authority to make decisions.

Question 12

Managers today continue to see work specialization as important because it helps employees be more efficient.

Question 13

When decisions tend to be made at lower levels in an organization, the organization is said to be decentralized.

Question 14

In order to make the most efficient use of work specialization, employees should be assigned tasks where they would perform near their optimum skill level.

Question 15

The acceptance theory of authority states that subordinates are willing to accept the authority of a manager if the order does not conflict with their personal beliefs.

Question 16

The acceptance theory of authority states that it is the right of the manager to expect employees to accept his/her authority.

Question 17

The purpose of organizing is to arrange and structure work to accomplish organizational goals.

Question 18

The acceptance theory of authority says that employees are willing to accept the authority of the manager under certain conditions.

Question 19

In highly formalized organizations, employees have more discretion in how they do their work.

Question 20

It is possible to carry work specialization too far thus lowering the economic advantages.

Question 21

Mechanistic organizations works best for companies whose strategy is to control costs.

Question 22

In general, the more routine the technology, the more mechanistic the structure should be.

Question 23

Innovators need the efficiency, stability, and tight controls of the mechanistic structure in order not to get out of control.

Question 24

An organic organization is low in centralization.

Question 25

In face of environmental uncertainty, organizations need the security of a mechanistic structure.

Question 26

A mechanistic organization is characterized by rigid departmentalization, a clear chain of command, and high formalization.

Question 27

Traditional organizational designs include the simple structure, the functional structure, and the divisional structure.

Question 28

The strength of the functional structure is that it focuses on results because managers are responsible for what happens to their products and services.

Question 29

Matrix structure is an organizational structure that assigns specialists from different functional departments to work on one or more projects led by project managers.

Question 30

An organic organization tends to be characterized by high specialization, narrow spans of control, and little participation in decision making by lower-level employees.

Question 31

An organic organization would likely be very flexible.

Question 32

The relationship between organizational size and structure tends to be linear.

Question 33

Project structures tend to be rigid and inflexible organizational designs.

Question 34

A simple structure is an organizational design with low departmentalization, narrow spans of control, and decentralized authority.

Question 35

Sharing knowledge throughout the organization is an important component of a boundaryless organization.

Question 36

Today's organizations mostly rely on strict rules and standardization to guide and regulate employee behavior.

Question 37

Organic organizations do not have a division of labour.

Question 38

The strength of the functional structure is that it focuses on results.

Question 39

Once an organization grows past a certain size, the impact of size on organization structure strengthens.

Question 40

Employee empowerment is crucial in a team structure because there is no line of managerial authority from top to bottom.

Question 41

Johnson & Johnson makes many well-known brands, including Band-Aids, Tylenol, and ACUVUE contact lenses. Their structure is organized under three sectors: consumer health, medical devices, and pharmaceuticals. They use __________ departmentalization.

A) geographical
B) customer
C) process
D) product
E) functional

Question 42

Grouping activities on the basis of production flow is called __________ departmentalization.

A) functional
B) product
C) geographical
D) process
E) customer

Question 43

The basis on which jobs are grouped together is called __________.

A) decentralization
B) specialization
C) formalization
D) coordination
E) departmentalization

Question 44

Organizational structure is defined as __________.

A) a set of managerial decisions and actions
B) a formal arrangement of jobs within an organization
C) a process that involves decisions about departmentalization
D) a process that involves decisions about span of control and formalization
E) the basis on which jobs are grouped together within an organization

Question 45

An organization that divides its sales responsibilities for pharmaceutical products into Ontario, Quebec, the Maritimes, and Western Canada is using __________ departmentalization.

A) product
B) geographical
C) process
D) customer
E) functional

Question 46

Universal Office Supply has organized its sales department under its three main account types: wholesale, retail, and government. Universal is using __________ departmentalization.

A) product
B) customer
C) process
D) geographical
E) functional

Question 47

Learning organization allows employees to work together the best way they can in empowered work teams.

Question 48

One purpose of organizing is to____________.

A) know what kinds of employees to hire in the future
B) allow customers to know who to deal with in the organization
C) establish relationships among employees, teams and departments
D) ensure the best and most specific job descriptions for each position
E) allow executives to better get to know their employees

Question 49

__________ departmentalization groups jobs on the basis of product flow through the organization.

A) Product
B) Functional
C) Process
D) Customer
E) Matrix

Question 50

A public service agency that has different representatives to assist businesses, families, and people with disabilities is organized by __________ departmentalization.

A) product
B) geographical
C) process
D) customer
E) functional

Question 51

In a learning organization, it is important to have managers to control and direct the flow of information.

Question 52

A virtual organizations contains elements of a traditional organization.

Question 53

A disadvantage of ________ departmentalization is poor communication across the different groups.

A) geographic
B) functional
C) process
D) customer
E) product

Question 54

The degree to which tasks in an organization are divided into separate jobs is called __________.

A) work specialization
B) departmentalization
C) chain of command
D) span of control
E) job differentiation

Question 55

A network organization is a small core organization that outsources major business functions.

Question 56

Work specialization is __________.

A) the degree to which tasks are divided into separate jobs
B) the basis on which jobs are grouped together
C) the basis on which jobs are ranked relative to their value to the businesses
D) the degree to which activities require highly specialized skills
E) a source of ever-increasing productivity

Question 57

Galaxy Corporation is organized into five departments: human resources, finance, marketing, production, and engineering. Galaxy uses __________ departmentalization.

A) geographical
B) customer
C) product
D) process
E) functional

Question 58

Functional departmentalization groups jobs by __________.

A) tasks performed
B) territories served
C) products manufactured
D) type of customer served
E) services provided

Question 59

Procter & Gamble organizes its 300 brands into five main categories: family care, fabric care, beauty care, health care, and food and beverage. They use __________ departmentalization.

A) geographical
B) customer
C) product
D) process
E) functional

Question 60

Work teams composed of individuals from various departments are known as ________ teams.

A) cross-control
B) cross-training
C) cross-functional
D) virtual
E) self-managed work

Question 61

The principle that each employee should report to only one manager is called __________.

A) authorized line of responsibility
B) unity of command
C) responsibility factor
D) chain of command
E) span of control

Question 62

__________ organization is rigidly controlled and efficient.

A) organic
B) command
C) project
D) mechanistic
E) boundaryless

Question 63

The degree to which jobs are standardized and guided by rules and procedures is called __________.

A) work specialization
B) centralization
C) regulation
D) formalization
E) specification

Question 64

As organizations become more flexible and responsive, there is a distinct trend toward __________.

A) centralized authority
B) decentralized decision making
C) increased formalization
D) narrower spans of control
E) reduced delegation

Question 65

__________ refers to the rights inherent in a position that allows a manager to tell subordinates what to do and then expect them to do it.

A) Responsibility
B) Unity of command
C) Chain of command
D) Authority
E) Accountability

Question 66

Under which of the following circumstances should an organization use more centralization?

A) environment is complex and uncertain
B) lower-level managers want a voice in decisions
C) decisions are relatively minor
D) company is geographically dispersed
E) organization is facing a crisis

Question 67

Under which of the following circumstances should an organization use more decentralization?

A) environment is stable
B) company is large
C) decisions are significant
D) company is geographically dispersed
E) organization is facing a crisis

Question 68

Assigning designers, production workers, and salespeople to a common work group to develop a new product is called a __________ team.

A) diversified skill
B) product innovation
C) cross-functional
D) trans-departmental
E) developmental project

Question 69

Another term for increased decentralization is __________ .

A) structural delayering
B) participative delegation
C) job enlargement
D) authority distribution
E) employee empowerment

Question 70

__________ is the obligation or expectation to perform an assigned duty.

A) Responsibility
B) Delegation
C) Authority
D) Span of control
E) Accountability

Question 71

The continuous line of authority that extends from the upper levels of management to the lowest levels of the organization is called the __________.

A) hierarchy of responsibility
B) unity of command
C) organizational chart
D) chain of command
E) span of control

Question 72

If top managers make key decisions with little input from below, then the organization is ________.

A) not mechanistic
B) more decentralized
C) not formalized
D) more centralized
E) departmentalized

Question 73

Pierre has just been promoted to line manager in the manufacturing plan. Which of the following should automatically accompany his new title of manager?

A) respect
B) delegation
C) higher compensation
D) acceptance by employees
E) authority

Question 74

All other things being equal, as the span of control grows wider, the organization becomes __________.

A) more bureaucratic
B) less effective
C) more organic
D) more efficient
E) more mechanistic

Question 75

The trend in recent years has been toward __________ spans of control to help reduce costs and speed up decision making.

A) narrower
B) wider
C) flexible
D) more stable
E) controllable

Question 76

Which one of Fayol's 14 principles of management helps preserve the concept of a continuous line of authority?

A) hierarchy of responsibility
B) unity of command
C) chain of authority
D) flow of delegation
E) span of control

Question 77

Two popular trends in departmentalization are the increasing use of __________ departmentalization and the use of __________ teams.

A) product; trans-departmental
B) functional; product innovation
C) process; diversified skill
D) customer; cross-functional
E) product; developmental project

Question 78

The degree to which decision making is concentrated at a single point in an organization is called __________.

A) unity of command
B) chain of command
C) span of management
D) centralization
E) concentration of authority

Question 79

A company is planning to revise its organizational structure and one of the managers suggests increasing employee empowerment by giving them more decision-making authority. Which of the following, if true, would support his stand?

A) The firm's employees are reluctant to disrupt the status quo and are apprehensive about any change in responsibility.
B) The firm's employees are used to an authoritative structure and clearly defined job-roles.
C) The company's front-line workers have first-hand knowledge of what can and cannot be done.
D) The company is trying to recover from an economic downturn that caused significant losses which necessitated downsizing.
E) The company culture revolves around the founder who is charismatic and in-charge kind of CEO.

Question 80

__________ refers to the number of subordinates that a manager can efficiently and effectively manage.

A) Responsibility
B) Unity of command
C) Chain of command
D) Span of control
E) Level of authority