Deck 15: Organizational Structure

Question 1

Employees tend to be more satisfied with jobs that require them to perform a specialized kind of activity.

Answer 1

False
Explanation: Organizations may struggle with employee job satisfaction when they make jobs highly specialized. Employees tend to be more satisfied with jobs that require them to perform a number of different kinds of activities.

Question 2

As companies become larger, they tend to use a combination of specialization, formalization, and centralization to control their activities, thereby becoming more mechanistic in nature.

Answer 2

True
Explanation: As organizations become larger, they need to rely on some combination of specialization, formalization, and centralization to control their activities, thereby becoming more mechanistic in nature.

Question 3

As companies grow larger, their organizational charts get simpler.

Answer 3

False
Explanation: As companies grow larger, their organizational charts get more complex.

Question 4

To keep the stress level low and avoid multiple chains of command issues, managers should adopt the matrix structure.

Question 5

Wide spans of control allow managers to be much more hands-on with employees.

Question 6

Restructuring an organization has a positive impact on task performance because restructuring helps employees view their jobs in new and exciting ways.

Question 7

Organic organizations are efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Question 8

Companies that follow a low-cost producer strategy believe that people will pay more for a product that is unique in some way.

Question 9

Decentralized organizational structures tend to concentrate power and authority within a relatively tight group of individuals in the firm.

Question 10

The chain of command helps the organization to attain order, control, and predictable performance.

Question 11

Henry Ford was a strong believer in work specialization.

Question 12

Many restructuring efforts are designed to remove one or more organizational layers to reduce costs.

Question 13

If technologies need to be changed often to suit consumer needs, the decisions should be centralized.

Question 14

A company's chain of control determines how many employees report to each manager.

Question 15

Organizational structure can have a significant impact on an organization's financial performance.

Question 16

Many layoff survivors experience a great deal of guilt and remorse following a layoff.

Question 17

The most common kind of restructuring in recent years has been a "flattening" of the organization.

Question 18

Matrix structures try to take advantage of two types of structure at the same time.

Question 19

Many small companies evolve into functionally based structures as they grow larger.

Question 20

In a traditional organizational structure, every employee has one person to whom they report.

Question 21

The more people under the control of one manager, the

A) greater the decentralization.
B) wider the span of control.
C) taller the organizational structure.
D) shorter the chain of command.
E) greater the work specialization.

Question 22

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. Meg was given the job of collecting information on which of the following elements of the organizational structure?

A) work specialization
B) chain of command
C) span of control
D) formalization
E) centralization

Question 23

Which of the following scenarios exemplifies span of control?

A) Briley is responsible for the fall seasonal product line.
B) Vanna is responsible for managing 16 employees.
C) Savannah makes all decisions affecting shipping.
D) Octavio performs one single task repeatedly.
E) Lucy earns over $100,000 per year.

Question 24

The managers at Microfab meet and realize that they have huge costs associated with training new employees, difficulty finding someone who can take the place of lost employees, and lower productivity than they would prefer from each employee. What can they do to address this issue?

A) decrease the amount of control managers have over employees
B) decrease the number of tasks each employee performs
C) increase the number of tasks each employee performs
D) increase the number of employees under each manger
E) train the new employees themselves

Question 25

________ formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.

A) The span of control
B) Formalization
C) Centralization
D) An organizational structure
E) The chain of command

Question 26

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. Andrea was asked to collect information on which of the following elements of the organizational structure?

A) work specialization
B) chain of command
C) span of control
D) formalization
E) centralization

Question 27

Work specialization refers to

A) where decisions are formally made in organizations.
B) the degree to which tasks in an organization are divided into separate jobs.
C) how many employees each manager in the organization has responsibility for.
D) answering the question of "who reports to whom?" and signifies formal authority relationships.
E) the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.

Question 28

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. On which element of organizational structure is Shane collecting information?

A) formalization
B) centralization
C) span of control
D) work specialization
E) chain of command

Question 29

Dana is the CEO of a large technology company. She has some very talented employees, but the company keeps falling behind its competitors. When Dana observes what is going on, she finds some cases where managers are micromanaging good employees, while other managers cannot address all the needs of their employees. Dana needs to address how her talent is

A) recruited.
B) identified.
C) organized.
D) disciplined.
E) compensated.

Question 30

Davanna is describing her company's organizational structure. Which of the following terms would she use in her description?

A) newcomer orientation
B) work specialization
C) personality testing
D) cognitive ability
E) cultural values

Question 31

Which of the following is True about work specialization?

A) It creates problems in larger firms where little flexibility is required.
B) It makes training new employees easier when replacements are needed.
C) It encourages employees to upgrade their skills in multiple disciplines.
D) It improves the flexible nature of workers.
E) It ensures that each worker performs different tasks every day.

Question 32

When looking at Wonder Guard Industries' organizational structure, Janice spots a heading for work specialization, which is also commonly referred to as

A) formalization.
B) centralization.
C) span of control.
D) division of labor.
E) chain of command.

Question 33

Eileen is the leader of a small compost facility that caters to organic farmers. She has to decide how many employees each supervisor will oversee, and how closely they will watch over them. This is an example of Eileen shaping her company's

A) supply chain.
B) profit margin.
C) cultural values.
D) mission statement.
E) organizational structure.

Question 34

The degree to which a job requires a number of different activities involving a number of different skills and talents is referred to as

A) task identity.
B) variety.
C) task significance.
D) autonomy.
E) feedback.

Question 35

Which element of the organizational structure signifies formal authority relationships?

A) chain of command
B) formalization
C) centralization
D) work specialization
E) span of control

Question 36

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. Francine is looking into information on which element of organizational structure?

A) centralization
B) formalization
C) span of control
D) chain of command
E) work specialization

Question 37

At Buddy's Bird Barn, every employee has to consult Buddy before completing any sale, and only Buddy can make decisions about purchasing and advertising. These rules represent ________ at Buddy's Bird Barn.

A) specialization
B) centralization
C) formalization
D) span of control
E) chain of command

Question 38

Which of the following shows every job in the organization and the formal reporting relationships between those jobs?

A) the chain of command
B) an organizational chart
C) a structural map
D) the scalar chain
E) a Gantt chart

Question 39

Span of control

A) is the degree to which tasks in an organization are divided into separate jobs.
B) answers the question of "who reports to whom?" and signifies formal authority relationships.
C) refers to where decisions are formally made in organizations.
D) refers to the number of employees each manager is responsible for in the organization.
E) is the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.

Question 40

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. On which element of organizational structure was Carol asked to collect evidence?

A) centralization
B) formalization
C) span of control
D) chain of command
E) work specialization

Question 41

Which of the following statements is True?

A) Wide spans of control tend to be associated with centralized decision making.
B) Narrow spans of control tend to be associated with decentralized decision making.
C) A high level of work specialization tends to bring about a high level of work formalization.
D) Mechanistic organizations are typified by a structure that relies on low levels of work formalization.
E) Organic organizations are typified by a structure that relies on high degrees of work specialization.

Question 42

In a mechanistic organization, employees are

A) encouraged to engage in lateral communication.
B) required to make their own decisions when appropriate.
C) given a very narrow view of the tasks they are to perform.
D) urged to develop knowledge outside of their specialization.
E) asked to think more broadly in terms of where their responsibilities lie.

Question 43

Current research suggests that

A) the narrower the span of control, the more productive employees become.
B) a moderate span of control is best for an organization's productivity.
C) spans of control in organizations have decreased significantly in recent years.
D) a wide span of control requires organizations to hire many managers.
E) a wide span of control is especially important if the manager has more skill than the subordinates.

Question 44

Organizational design is the process of

A) creating procedures used to standardize employee behavior.
B) creating, selecting, or changing the structure of an organization.
C) empowering employees to have a greater say in the decision-making process.
D) determining how corporate management offices will be laid out and decorated.
E) describing an organization's objectives and goals and how it tries to make money.

Question 45

Paul's Creations makes handcrafted furniture out of vine twisted sassafras wood. Paul's could make the furniture more efficiently, but the individual touch and specially selected wood draws in customers who are willing to pay a premium for Paul's Creations' furniture. Paul's Creations is an example of a

A) matrix.
B) differentiator.
C) low-cost producer.
D) mechanistic design.
E) geographic structure

Question 46

In an organic organization,

A) employees know exactly whom they report to.
B) employees are not encouraged to make decisions without their manager's consent.
C) there are very clear lines of authority from the employee to the president of the company.
D) employees are encouraged to develop knowledge and expertise outside of their specialization.
E) information is passed through vertical communication between an employee and his or her supervisor.

Question 47

Centralization reflects

A) where decisions are formally made in organizations.
B) the degree to which tasks in an organization are divided into separate jobs.
C) how many employees each manager in the organization has responsibility for.
D) the answer to the question of "who reports to whom?" and signifies formal authority relationships.
E) the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.

Question 48

A ________ span of control creates a ________ organization structure.

A) wide; flat
B) tall; flat
C) moderate; narrow
D) narrow; flat
E) flat; moderate

Question 49

Talia formed a technology start-up in her garage, and it has grown more rapidly than she ever imagined. She has always kept tabs on all of her people, and her company has just passed 150 employees. What should she do now?

A) send managers to large corporations to bring back a sense of largeness
B) add more structure for communication and decision-making
C) decrease structure for communication and decision-making
D) increase the number of decisions that only she can make
E) eliminate some positions to keep numbers manageable

Question 50

If decision making is pushed down to lower-level employees, and these employees feel empowered to make decisions on their own, an organization has a ________ structure.

A) flat
B) decentralized
C) wide
D) narrow
E) centralized

Question 51

Which of the following is a necessary coordination mechanism that organizations rely on to get a standardized product or deliver a standardized service?

A) formalization
B) centralization
C) span of control
D) chain of command
E) work specialization

Question 52

Organic organizations are typified by a structure that relies on

A) a rigid and hierarchical chain of command.
B) high degree of work specialization.
C) centralization of decision making.
D) high levels of formalization.
E) weak chains of command.

Question 53

Formalization refers to

A) where decisions are formally made in organizations.
B) the degree to which tasks in an organization are divided into separate jobs.
C) how many employees each manager in the organization has responsibility for.
D) the answer to the question of "who reports to whom?" and signifies formal authority relationships.
E) the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.

Question 54

At Pleasant Pools Inc., there is a total focus on providing care and satisfaction to each customer. In the Prominent Clients division, each manager is assigned 3 employees to supervise, whereas in the Component Assembly division, each manager supervises about 15 employees. The Prominent Clients division managers can be described as having ________ as opposed to ________ for the Component Assembly division managers.

A) a narrow span of control; a wide span of control
B) a wide span of control; a narrow span of control
C) narrow centralization; tall centralization
D) tall formalization; flat formalization
E) flat formalization; tall formalization

Question 55

In Big Bluff Heirlooms, a furniture manufacturing company, the arrival and departure times to and from work are specified to the minute, with time clocks used to control deviant behavior. It can be said that the company is high in

A) formalization.
B) centralization.
C) decentralization.
D) division of labor.
E) work differentiation.

Question 56

The relationship between performance and span of control is graphed as a(n)

A) "arch" shape.
B) "U" shape.
C) straight horizontal line.
D) straight vertical line.
E) diagonal line sloping up to the right.

Question 57

Jeff and Matthew, father and son, opened a large boutique named Modus in Chicago. Being the owners of the business, they decide all of the important matters. All the rest of the decisions like product, finance, marketing, and personnel are carried out by the department heads, who have to act according to Jeff's and Matthew's instructions and orders. Which of the following is True about Modus?

A) The degree of formalization is very low in the organization.
B) It has a centralized system of decision making.
C) It has a very tall organizational structure.
D) It has a matrix organizational structure.
E) It has a narrow span of control.

Question 58

Which of the following is associated with decentralization in decision making?

A) moderate spans of control
B) tall spans of control
C) wide spans of control
D) narrow spans of control
E) flat spans of control

Question 59

Michelle's Universal Boat Fins makes one product, a type of boat fin designed to fit on any pontoon boat, over and over again. The fins never change, because the unique design fits all boats. Given the nature of its business, Michelle's should

A) look for ways to vary its manufacturing procedures.
B) give each employee a specific task to perform.
C) allow employees to make their own decisions.
D) have a low mechanistic structure.
E) adopt an organic structure.

Question 60

Organic organizations are

A) efficient, rigid, predictable, and standardized organizations that thrive in stable environments.
B) more complex designs that try to take advantage of two types of structures at the same time.
C) flexible, adaptive, outward-focused organizations that thrive in dynamic environments.
D) business units grouped around different products that the company produces.
E) flat organizations with one person as the central decision-making figure.

Question 61

A bureaucratic structure is an organizational form that exhibits many of the facets of the ________ organization.

A) simple
B) global
C) adaptive
D) organic
E) mechanistic

Question 62

One element of a firm's environment is

A) work specialization.
B) chain of command.
C) decentralization.
D) formalization.
E) customers.

Question 63

What is the primary reason for simple structures being perhaps the most common form of organizational design?

A) There are more small organizations than large ones.
B) Employees can come and go with no major ripple effects on the organization.
C) Changes in specialization lead to less confusion about how exactly employees are supposed to do their jobs.
D) Employees feel less emotionally attached to the firm.
E) Approval for decisions need not be authorized at every step of the hierarchy.

Question 64

At LMNO Creating, employees are grouped according to their expertise in an area. All marketing employees are in one department, all finance employees are grouped in another department, and similarly, all human resources and manufacturing employees are in their respective departments. Which of the following structures does LMNO Creating use?

A) client-based
B) geographic
C) functional
D) product
E) simple

Question 65

Company strategy refers to

A) the method by which an organization transforms inputs into outputs.
B) the degree to which tasks in an organization are divided into separate jobs.
C) customers, competitors, suppliers, distributors, and other factors external to the firm.
D) an organization's objectives and goals and how it tries to capitalize on its assets to make money.
E) how jobs and tasks are divided and coordinated between individuals and groups within the company.

Question 66

As organizations become larger, they tend to become more ________ in nature.

A) simple
B) cultural
C) mechanistic
D) organic
E) flat

Question 67

Which of the following examples illustrates a functional structure?

A) Linda's Pet Grooming has eight employees that all report to Linda.
B) Rio Riffic has a hydraulics division, a PVC division, and a fixtures division.
C) AB Aeronautics has a private division, a commercial division, and a government division.
D) BG Limited has a Pacific Northwest division, a Midwest division, and a Northeast Division.
E) Handy Homes has a financial department, a production department, and a sales department.

Question 68

Which of the following examples illustrates a client structure?

A) Ayden's Printing has 18 employees that all report to Ayden.
B) Motor Monster has a pistons division, a manifold division, and a gasket division.
C) Stone Farms has a restaurant division, a supermarket division, and a festival division.
D) BG Limited has a Pacific Northwest division, a Midwest division, and a Northeast Division.
E) Lighting Landing has a marketing department, a lending department, and a warranty department.

Question 69

________ structures are perhaps the most common form of organizational design.

A) Simple
B) Functional
C) Client-based
D) Product
E) Matrix

Question 70

SB Stationary is the low-cost producer of one type of standard notepad. Given that it operates in a fairly stable environment, the company focuses on making its product as efficiently as possible. Which of the following approaches to organizational design is likely to be appropriate for SB Stationary?

A) multi-divisional
B) mechanistic
C) organic
D) global
E) matrix

Question 71

A ________ structure makes perfect sense for a small organization because employees can come and go with no major ripple effects on the organization.

A) bureaucratic
B) matrix
C) multi-divisional
D) simple
E) geo-demographic

Question 72

Which of the following statements about companies that adopt a differentiation strategy is True?

A) They believe that people will pay more for a product that is unique in some way.
B) Their focus is on being as efficient as they can be.
C) They rely on selling products at the lowest possible cost.
D) They are more likely to take a mechanistic approach to organizational design.
E) They concentrate on developing large quantities of the same product, thereby providing cost advantages to their customers.

Question 73

A ________ structure is a flat organization with one person as the central decision-making figure.

A) functional
B) product
C) client-based
D) simple
E) matrix

Question 74

Which of the following statements about an organization in a dynamic business environment is True?

A) It does not change frequently.
B) It allows organizations to primarily focus on efficiency.
C) It requires organizations to have structures that are more rigid.
D) It requires little change over time.
E) It requires organizations to have structures that are more adaptive.

Question 75

Which of the following statements about companies that adopt a low-cost producer strategy is True?

A) They believe that people will pay more for a product that is unique in some way.
B) They rely on selling products at the lowest possible cost.
C) They depend on being able to adjust to changing environments quickly.
D) Such companies are more likely to take an organic approach to organizational design.
E) They focus on supplying high-quality differentiated products to customers.

Question 76

The method by which an organization transforms its inputs into outputs refers to its

A) structure.
B) technology.
C) specialization.
D) quality.
E) projects.

Question 77

One of the biggest environmental factors affecting organizational structure is whether the

A) competitor's structure matches industry needs.
B) external culture clashes with intrinsic values.
C) suppliers' cultures match the company's.
D) outside environment is stable or dynamic.
E) internal environment is stable or dynamic.

Question 78

The most basic bureaucratic structure is the ________ structure.

A) client-based
B) matrix
C) organic
D) functional
E) simple

Question 79

Stately Crafters is a custom manufacturer of hand-crafted furniture. The company has 101 locations throughout the country and relies on decentralized decision making to meet the needs of the dynamic environment and customer needs. Which of the following approaches to organizational design is likely to be appropriate for Stately Crafters?

A) matrix
B) global
C) simple
D) organic
E) mechanistic

Question 80

Mazie heads Grass Roots Diversified, a company that started making garden rakes in Oregon and has now diversified into a huge range of areas totally unrelated to gardening. Grass Roots has become impossible to run under its current configuration. How should Mazie redesign the organization?

A) create complete business units in Oregon, Kansas, and Alabama
B) group business units by rakes, furniture, shelving, and kitchen goods
C) group employees by accounting, marketing, design, production, and so on
D) structure business units according to the technology used to create products
E) organize the business units around serving the government, gardening stores, and kitchen stores