Question 1

Mini-Case
Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years. Employees appear demoralized and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability.
-Employee complaints that there are too many layers of management and too many rules and regulations suggest that Mucho Dinero is a(n):
A) flat organization.
B) bureaucratic organization.
C) inverted organization.
D) wide organization.

Accepted Answer

The complaints about too many layers of management and rules and regulations suggest that Mucho Dinero is a bureaucratic organization. Bureaucratic organizations are characterized by a hierarchical structure with many levels of management and formal rules and policies.

Question 2

Mini-Case
Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years. Employees appear demoralized and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability.
-In order to encourage more interdepartmental communication and cooperation, Angelica is thinking about setting up groups of workers from different departments to work together on a long-term basis. She is even thinking about asking people from some of Mucho Dinero's suppliers, customers, and distributors to join these groups. The type of group that Angelica is considering is known as a(n):
A) focus group.
B) dynamic group.
C) matrix team.
D) cross-functional team.

Accepted Answer

A cross-functional team is a group composed of individuals from different functional areas of a business who work together towards a common goal or project. This type of team would encourage interdepartmental communication and cooperation, which is what Angelica is looking to achieve. Additionally, the involvement of suppliers, customers, and distributors in these groups could provide valuable insights and perspectives. Therefore, a cross-functional team would be the best choice for Angelica's plan.

Question 3

Describe two major issues that are important in organizational design.

Accepted Answer

The answer of Describe two major issues that are important...

Question 4

Mini-Case
Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years. Employees appear demoralized and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability.
-From her discussions with employees, Angelica learned quickly that production workers put their trust in 20-year veteran Willie McClaren. Many people told her that if you wanted something done, Willie was the person to see. Willie appears to be an important part of the:
A) decentralized authority.
B) span of control.
C) informal organization.
D) functional structure.

Accepted Answer

Willie McClaren's importance to the organization is a result of informal relationships and networks, which are a part of the informal organization. This is separate from the formal structure of the organization, which is characterized by departments, job descriptions, and formal reporting relationships.

Question 5

What is a cross-functional, self-managed team? Who would serve on such teams? Why do cross-functional, self-managed teams often lead to networking?

Accepted Answer

The answer of What is a cross-functional, self-managed team? Who...

Question 6

Mini-Case
Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years. Employees appear demoralized and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability.
-Angelica's decision to completely redesign Mucho Dinero's organization indicates that she believes the best approach to her firm's problems is:
A) competitive benchmarking.
B) flexible departmentalization.
C) restructuring.
D) organizational therapy.

Accepted Answer

Angelica's decision to completely redesign the organization suggests that she believes the current structure is not effective in addressing the problems facing the company. The lack of communication and decision-making delays indicate that the current structure may be too bureaucratic or inflexible. Therefore, restructuring the organization would involve revising the current structure, processes, and procedures to build a more efficient and effective system. This approach would better position the company to achieve its goals and objectives, such as increasing quality and customer satisfaction, and ultimately regain profitability.

Question 7

What is a matrix organization? What advantages and disadvantages are associated with this type of organization?

Accepted Answer

The answer of What is a matrix organization? What advantages...

Question 8

Mini-Case
Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years. Employees appear demoralized and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability.
-Currently, Mucho Dinero is organized into specialized departments such as marketing, finance, production and personnel. These departments are designed to allow people with similar skills and expertise to work together. This approach is known as ___________ departmentalization
A) functional
B) process
C) interest group
D) task-oriented

Accepted Answer

Mucho Dinero's current structure where departments are based on similar skills and expertise is known as functional departmentalization. Process departmentalization involves departments based on the process flow like product design, order fulfillment, and shipping. Interest group departmentalization is when departments are created based on a common interest like a diversity committee. Task-oriented departmentalization is when departments are based on specific tasks or projects. None of the other options fit the description of Mucho Dinero's current structure.

Question 9

Explain the difference between a firm's formal organization and its informal organization. Why are both types of organization important to managers?

Accepted Answer

The answer of Explain the difference between a firm's formal...

Quiz 8: Structuring Organizations for Todays Challenges

Describe two major issues that are important in organizational design.

What is a cross-functional, self-managed team? Who would serve on such teams? Why do cross-functional, self-managed teams often lead to networking?

What is a matrix organization? What advantages and disadvantages are associated with this type of organization?

Explain the difference between a firm's formal organization and its informal organization. Why are both types of organization important to managers?