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Exam 8: Structuring Organizations for Todays Challenges

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Question 151

True/False

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The functions that a company can perform as well as or better than anyone else in the world are known as that firm's optimized capabilities.

A) True
B) False

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Question 152

Multiple Choice

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The concept of ________ suggests that as a firm produces more, the average cost of goods produced goes down.

A) natural growth
B) survival of the fittest
C) cost enhancement
D) economies of scale

E) A) and B)
F) None of the above

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Question 153

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Donna is a sales representative for the Eastern Essentials Company. She really enjoys working for Eastern Essentials, because she and others are treated as highly valued employees. Sales reps are given freedom and flexibility in their relationships with customers. While there are only a few layers of management at Eastern Essentials, Donna has found that these managers try their best to support and assist her efforts. Based on Donna's experience, it appears that Eastern Essentials is a(n)

________ means that decision-making authority is delegated to lower-level managers and employees.

The optimum number of subordinates a manager should supervise is referred to as the span of control.

Julio is the owner of Party Pros, Inc., a party supply company. The company provides tents, tables, chairs, and related products for weddings, Bar and Bat Mitzvahs, graduations, birthdays, and other celebrations. As sales have increased, the organization has brought on more personnel and departmentalized to more efficiently handle purchasing, sales, service, and accounting. Everyone is still responsible for achieving company goals. Upon seeing Celebration's organization chart, you agree it uses a

Superstars Soccer Camp recently outsourced its marketing work. This suggests that management at Superstars does not believe that marketing is one of the firm's core competencies.

The grapevine refers to the formal channel used for confidential communications between members of top management.

While most organizations have a formal organization structure, only poorly managed firms also have an informal organization.

Management at Leaves of Green, a nationwide vegetarian restaurant chain, believes that its customers value a predictable and consistent level of service and quality. When customers stop at one of its restaurants anywhere in the U.S., they should know what to expect in terms of menu, price and quality. In order to maintain this consistency, Leaves of Green should adopt a decentralized organization.

A manager needs to be called to sign off on every return that a cashier performs at Sun and Fun Sportswear. The CEO continues this policy because he wants every manager to "look those customers right in the eye" and "stake their job on taking those items back." Clearly, Sun and Fun empowers its employees to make decisions at their jobs.

Successful managers will find the balance between promoting the informal organization and maintaining a formalized structure, as well.

Top Dog Company is a medium-sized organization with well-defined lines of authority and every employee reports to only one boss. However, the managers at Top Dog complain about not having expert support staff to offer advice. Because of the inefficient long lines of communication, opportunities are slipping through the cracks. These characteristics suggest that Top Dog employs a matrix organization.

A(n) ________ is a visual device that shows relationships among people and divides the organization's work.

If you are a new employee at Reinhold Industries, Javier is the man to see in the welding department. Though he may not be a manager, he is the person that most of the others in the department look to for advice and assistance. Javier is an important member of the firm's

The purpose of a division of labor and specialization is to improve an employee's job performance.

In an inverted organization, the purpose of management is to assist and support the decisions of employees who work directly with customers.

The matrix organization model brings together experts from different functional units of the firm to work on specific projects.

Departmentalization by function typically increases the cost of doing business.

Max Weber's organizational theories require an educated workforce to operate efficiently.