Question 1

According to the text, the factor that most distinguishes a superior team from a good team is talent.

Accepted Answer

Vision, talent, and motivation can carry a team only so far. Research has shown that super teams have higher levels of authenticity and caring, which allowed the full synergy of their individual talents, motivation, and vision.

Question 2

The virtual organization is characterized by participating firms which pursue a collective strategy that enables them to cope with environmental uncertainty through cooperative efforts.

Accepted Answer

The virtual organization is characterized by participating firms that give up part of their control and accept interdependent destinies. Participating firms pursue a collective strategy that enables them to cope with uncertainty through cooperative efforts.

Question 3

One of the advantages of boundaryless structures is that they can be implemented without upgrading the skills of workers and managers.

Accepted Answer

As boundaryless structures are implemented, processes are reengineered, and organizations become increasingly dependent on sophisticated ITs, the skills of workers and managers alike must be upgraded to realize the full benefits.

Question 4

Firms that place too strong a priority on either adaptability or alignment can expect short term gains only.

Accepted Answer

Handling such opposing demands is difficult because there will always be some degree of conflict. Firms often suffer when they place too strong a priority on either adaptability or alignment. If it places too much focus on adaptability, the firm will suffer low profitability in the short term. If managers direct their efforts primarily at alignment, they will likely miss out on promising business opportunities.

Question 5

One of the challenges of an ambidexterity in a firm is that it must ensure that it remains proactive in expanding or modifying its product-market scope to anticipate and satisfy market conditions.

Accepted Answer

Ambidextrous organizational designs incorporate two contradictory challenges faced by managers today. First, managers must explore new opportunities and adjust to volatile markets in order to avoid complacency. They must ensure that they maintain adaptability and remain proactive in expanding and/or modifying their product-market scope to anticipate and satisfy market conditions. Such competencies are especially challenging when change is rapid and unpredictable.

Question 6

The O'Reilly and Tushman study on ambidextrous organizational designs found that there was no relationship between organizational structure, management practices employed and performance of both the breakthrough initiative and the traditional business.

Accepted Answer

The study found that the organizational structure and management practices employed had a direct and significant impact on the performance of both the breakthrough initiative and the traditional business. The ambidextrous organizational designs were more effective than the other three designs on both dimensions: launching breakthrough products or services (i.e., adaptation) and improving the performance of the existing business (i.e., alignment).

Question 7

According to author Jeffrey Pfeffer, the advantages of teams are that employees control themselves, develop more creative solutions to problems, and permit the absorption of administrative tasks previously performed by specialists.

Accepted Answer

Jeffrey Pfeffer suggests that teams have three primary advantages. First, teams substitute peer-based control for hierarchical control of work activities. Second, teams frequently develop more creative solutions to problems because they encourage the sharing of the tacit knowledge held by individuals. Third, by substituting peer control for hierarchical control, teams permit the removal of layers of hierarchy and absorption of administrative tasks previously performed by specialists.

Question 8

Outsourcing relieves companies of the requirement to maintain skill levels needed to manufacture essential components.

Accepted Answer

Too much outsourcing can result in a firm giving away too much skill and control. Outsourcing relieves companies of the requirement to maintain skill levels needed to manufacture essential components. They become more dependent upon their suppliers.

Question 9

Because the modular form of organizing involves outsourcing vital functions, modular firms often forfeit full strategic control.

Accepted Answer

The modular organization outsources non-vital functions, tapping into the knowledge and expertise of best in class suppliers, but retains strategic control. Outsiders may be used to manufacture parts, handle logistics, or perform accounting activities.

Question 10

One of the risks of outsourcing is a loss of cross-functional skills.

Accepted Answer

Cross-functional skills are acquired through the interaction of individuals in various departments within a company, which assists a department in solving problems. However, if a firm outsources key functional responsibilities, such as manufacturing, communication across departments can become more difficult. A firm and its employees must now integrate their activities with a new, outside supplier.

Question 11

Ambidextrous organizational designs are useful for firms that wish to create modest, incremental innovations at the same time as dramatic, breakthrough innovation. This is done by maintaining adaptability and alignment of values and coordination across organizational activities.

Accepted Answer

Firms that achieve both adaptability and alignment are considered ambidextrous organizations, aligned and efficient in how they manage the business of today, but flexible enough to changes in the environment so that they will prosper tomorrow.

Question 12

Outsourcing in noncore functions of modular companies offers the advantage of decreased overall costs, but the company will be unable to focus on scarce resources in the areas where it holds competitive advantage.

Accepted Answer

In a modular company, outsourcing the noncore functions offers three advantages: A firm can decrease overall costs, stimulate new product development by hiring suppliers with superior talent to that of in-house personnel, avoid idle capacity, reduce inventories, and avoid being locked into a particular technology; It can focus scarce resources on the areas where it holds a competitive advantage. These benefits can translate into more funding for R and D hiring the best engineers, and providing continuous training for sales and service staff; it can tap into the knowledge and expertise of its specialized supply chain partners, adding critical skills and accelerating organizational learning.

Question 13

Managing virtual structures requires new and difficult-to-acquire managerial skills.

Accepted Answer

One of the negatives associated with the virtual organization is that it requires new and difficult-to-acquire managerial skills.

Question 14

One of the challenges of an ambidexterity in a firm is that managers must effectively exploit the value of their existing assets and competencies to assure alignment between how value is being created in the short term and how activities are integrated and properly coordinated.

Accepted Answer

Ambidextrous organizational designs incorporate two contradictory challenges faced by managers today. Managers must effectively exploit the value of their existing assets and competencies. They need to have alignment, which is a clear sense of how value is being created in the short term and how activities are integrated and properly coordinated.

Question 15

Modular companies can achieve rapid growth because they do not require large investments in fixed assets.

Accepted Answer

The modular type enables a company to leverage relatively small amounts of capital and a small management team to achieve seemingly unattainable strategic objectives.

Question 16

Horizontal organization structures facilitate resource sharing and help to create a sense of common purpose.

Accepted Answer

Horizontal organizational structures, which group similar or related business units under common management control, facilitate sharing resources and infrastructures to exploit synergies among operating units and help to create a sense of common purpose.

Question 17

Procter & Gamble used communities of practice and human resource practices to help it achieve effective collaboration and integration across its different business units. This effort resulted in the successful development of the Crest Whitestrips product and is an example of good use of boundary-constrained organizational design.

Accepted Answer

This is a good example of boundaryless organizational design in which effective collaboration and integration across the different business units of P & G resulted in the successful introduction of Crest Whitestrips.

Question 18

Managers trained in rigid hierarchies do not find it difficult to transition to participative style required for effective teamwork.

Accepted Answer

Often, managers trained in rigid hierarchies find it difficult to make the transition to the more democratic, participative style that teamwork requires.

Question 19

A barrier-free organization creates successful relationships between internal and external constituencies and sometimes with competitors as well.

Accepted Answer

Barrier-free organizations create successful relationships between both internal and external constituencies. There is one additional constituency, competitors, with whom some organizations have benefited as they developed cooperative relationships. For example, after struggling on their own to develop the technology, Ford, Renault-Nissan, and Daimler have agreed to cooperate with each other to develop zero emission, hydrogen fuel cell systems to power automobiles.

Question 20

The virtual type of organization is a network of independent companies linked together to share skills, costs, and access to the markets of each other.

Accepted Answer

The virtual organization can be viewed as a continually evolving network of independent companies (suppliers, customers, even competitors) linked together to share skills, costs, and access to the markets of each other.

Quiz 10: Creating Effective Organizational Designs