Q&A Hero

Q: The board has the legal authority to hire, fire, and discipline corporate management.

Q: The stakeholder group with ultimate authority over the use of a corporation's resources is customers.

Q: To be effective, an organization must at least minimally satisfy the interests of all the groups that have a stake in the organization.

Q: All stakeholder groups are equally important for an organization.

Q: Suppliers have a direct effect on the organization's efficiency and an indirect effect on its ability to attract customers.

Q: Customers are usually an organization's smallest outside stakeholder group.

Q: The workforce and managers are considered outside stakeholders.

Q: Shareholders are the owners of the organization.

Q: Shareholders' claim on organizational resources is often considered inferior to the claims of other inside stakeholders.

Q: Shareholders are a part of inside stakeholders.

Q: In general, stakeholders are motivated to participate in an organization if they receive inducements that exceed the value of the contributions they are required to make.

Q: What are operative goals?

Q: Discuss the internal systems approach to measuring organizational effectiveness.

Q: Discuss the external resource approach to measuring organizational effectiveness.

Q: You are a consultant to Apex Corporation. The CEO insists that effectiveness must be evaluated by an increase in stock price to satisfy stockholders. The marketing vice president insists that the main goal is to reduce the time to bring products to the customer. The manufacturing vice president states that production costs should be the key focus of the organization. What approach is each manager using to evaluate organizational effectiveness, and what can this organization do to ensure that effectiveness is properly evaluated?

Q: A large company was successful, but has been losing market share and laying off workers. Product development has been slow. What could be the source of the problem, and what can be done to resolve it?

Q: Define organizational culture and discuss its significance.

Q: Describe the significance of the organizational structure.

Q: What is the difference between economies of scale and economies of scope?

Q: Describe the advantages of forming an organization.

Q: List four examples of factors or entities impacting the organization's environment.

Q: List four examples of "organizational outputs."

Q: List four examples of "organizational inputs."

Q: Define entrepreneurship.

Q: What is an organization?

Q: Which of the following is an example of an official goal? A) reduce delivery time to customer B) become a leading producer of a product C) increase market share D) increase product quality

Q: Operative goals ________. A) are meant to legitimize the organization and its activities, to allow it to obtain resources and the support of its stakeholders B) focus only on the long term C) focus only on the short term D) can be used to measure how well an organization is managing its environment

Q: Usually the ________ goals lay out the mission of the organization. A) tactical B) profit C) short-term D) official

Q: Which of the following terms refers to the goals that explain why the organization exists and what it should be doing? A) mission B) tactical goal C) operative goal D) profit goal

Q: ________ goals are guiding principles that the organization formally states in its annual report and in other public documents. A) Operative B) Profit C) Tactical D) Official

Q: If an organization is using the technical approach to measure organizational effectiveness then it will attempt to ________ to increase the effectiveness of the organization. A) increase product quality B) lower costs of inputs C) increase coordination and motivation of employees D) increase stock price

Q: Top management's ability to perceive and respond to changes in the environment or to initiate change and be first to take advantage of a new opportunity indicates the effectiveness of the organization as per the ________ approach. A) external resource B) transactional C) internal systems D) technical

Q: Which of the following goals is most likely to be set by an organization to measure effectiveness when it uses the external resource approach to measure organizational effectiveness? A) improve customer service B) reduce production costs C) increase stock price D) cut decision-making time

Q: In order to measure organizational effectiveness, an organization uses indicators such as stock price and market share. These indicators show that the organization is using the ________ approach to measure the organizational effectiveness. A) external resource B) internal system C) technical D) transactional

Q: A computer manufacturer was concerned about its effectiveness, so it eliminated a level in its hierarchy and decentralized decision-making authority. Which of the following approaches is it using to evaluate organizational effectiveness? A) external resource approach B) internal system approach C) technical approach D) transaction cost approach

Q: In order to measure organizational effectiveness, an organization measures the amount of time needed to get new products to market, and the amount of time spent coordinating the activities of different departments. This indicates that the organization is using the ________ approach to measure the organizational effectiveness. A) internal systems B) transactional C) external resource D) technical

Q: Which of the following goals set by an organization to measure effectiveness indicates that it is using the external resource approach to measure organizational effectiveness? A) reduce production costs B) increase coordination and motivation of employees C) gain support of stakeholders such as government or environmentalists D) reduce delivery time to customer

Q: Which of the following goals set by an organization to measure effectiveness indicates that it is using the internal systems approach to measure organizational effectiveness? A) lower costs of inputs B) increase stock price C) improve customer service D) increase rate of product innovation

Q: In order to measure organizational effectiveness, an organization uses indicators such as number of defective products and cost of production. These indicators show that the organization is using the ________ approach to measure organizational effectiveness. A) external resource B) technical C) internal systems D) transactional

Q: Which of the following goals is most likely to be set by an organization to measure effectiveness if it is using the technical approach to measure organizational effectiveness? A) reduce production cost B) increase market share C) increase rate of product innovation D) lower costs of input

Q: As per the external resource approach to measuring organizational effectiveness, an organization will most likely attempt to ________ to increase its effectiveness. A) increase rate of product innovation B) increase market share C) reduce conflict D) reduce number of defects

Q: The ________ approach allows managers to evaluate the organization's ability to be innovative and function quickly and responsively. A) external resource B) internal systems C) technical D) transaction

Q: The ________ approach allows managers to evaluate the organization's ability to secure, manage, and control scarce and valued skills and resources. A) external resource B) internal systems C) technical D) transaction

Q: Chief operating officers (COOs) ________. A) oversee organizational structure and culture B) determine competitive strategies for the organization C) are made responsible for achieving the predefined profit level D) are head of the R&D department in the organization

Q: The ________ approach to measuring organizational effectiveness evaluates the organization's ability to convert skills and resources into goods and services efficiently. A) external resource B) technical C) internal systems D) transactional

Q: Researchers analyzing what CEOs and managers do for measuring organizational effectiveness, have pointed to ________ as the three most important processes managers use to assess and measure how effective they, and their organizations, are at creating value. A) innovation, efficiency, and differentiation B) differentiation, control, and environmental scanning C) control, innovation, and efficiency D) environmental scanning, control, and innovation

Q: An organization's ________ determine how effectively managers are able to coordinate and motivate workers. A) environmental factors B) core competences C) structure and culture D) competitive advantages

Q: The quality of organizational decision-making is a function of the ________. A) organizational core competences B) environment of the organization C) diversity of the viewpoints that get considered D) value chain followed by the organization

Q: Which of the following terms refers to the specific pattern of decisions and actions that managers take to use core competences to achieve a competitive advantage and outperform competitors? A) strategy B) value chain C) organizational design D) histogram

Q: Competitive advantage is the ability of a company to ________. A) identify changes in consumer tastes and preferences B) outperform another company because its managers are able to create more value from the resources at their disposal C) develop a flexible organization structure that can quickly respond to changes in the environment D) achieve economies of scale by manufacturing a product in large volumes

Q: Which of the following are contingencies that cause the organization to face uncertainty? A) organizational design and organizational processes B) changing technology and organizational design C) global environment and changing technology D) organizational structure and global environment

Q: Which of the following definitions best describes a contingency? A) It is an event occurred in the past which resulted in heavy profits for the company. B) It is an event due to which a company identifies its competitive advantage. C) It is an event that might occur and must be planned for. D) It is an event occurred in the past which resulted in heavy loss for the company.

Q: At Microsoft, to control scientists and make use of their talents, Bill Gates put them in teams. This is an example of a change in an organization's ________. A) culture B) behavior C) environment D) structure

Q: The process by which organizations move from their present state to some desired future state is called ________. A) organizational triangulation B) environmental scanning C) organizational change D) transaction analysis

Q: Which of the following statements is true regarding organizational design? A) An organizational design once formed remains constant throughout the life of the organization. B) Every organization must identify the single perfect design that fits its needs and then implement it. C) Once an organizational design is in place, it hinders the process of organizational change. D) Organizational design deals with structure and culture of the organization.

Q: Coca-Cola takes pride in a long-term commitment to employees; Pepsi is very political and competitive. These are differences in organizational ________. A) culture B) structure C) environment D) design

Q: ________ is the process by which managers select and manage aspects of structure and culture so an organization can control the activities necessary to achieve its goals. A) Organizational design B) Competitive analysis C) Arbitration D) Environmental scanning

Q: Organizational culture ________. A) remains the same once it is developed B) controls organizational members' interactions with each other C) is shaped primarily by an organization's environment D) is the formal system of task and authority relationships

Q: The principal purpose of organizational structure is to ________. A) determine the vision and mission of the organization B) develop new and improved products for the existing markets C) control how people coordinate their actions and use resources D) select an appropriate business strategy that will help the organization achieve its long term goals

Q: Which of the following terms refers to the study of how organizations function and how they affect and are affected by the environment in which they operate? A) organizational behavior B) organizational theory C) organizational culture D) organizational environment

Q: When local store managers try to spot trends and changes so that they can respond to customer needs, they are attempting to ________. A) increase the elasticity of supply B) decrease the transaction costs C) manage the external environment D) increase the division of labor

Q: ________ costs are the costs associated with negotiating, monitoring, and governing exchanges between people. A) Historical B) Sunk C) Transaction D) Opportunity

Q: An automobile company modifies its existing automated production line so that it can manufacture two more models of cars using the same facility. This shows that the automobile manufacturer is planning to take advantage of ________. A) economies of scope B) deferred revenues C) transaction costs D) elasticity of supply

Q: ________ are cost savings that result when goods and services are produced in large volume on automated production lines. A) Sunk costs B) Economies of scale C) Deferred revenues D) Economies of scope

Q: A toy maker sells a large number of toys and due to the large volume production it is able to acquire the raw materials required to make the toys at a cheaper price than the competition. In this case, the toy maker is taking advantage of ________. A) economies of scale B) economies of scope C) organizational culture D) organizational structure

Q: ________ are cost savings that result when an organization is able to use underutilized resources more effectively because they can be shared across several different products or tasks. A) Economies of scale B) Sunk costs C) Deffered revenues D) Economies of scope

Q: Which of the following is most likely to be the result of the formation of an organization? A) It decreases the need for division of labor. B) It increases the transaction costs. C) It exerts pressure on individuals to conform to task and production requirements. D) It makes production more costly.

Q: An organization ________. A) facilitates the division of labor B) increases transaction costs C) has little power over individuals working in it D) cannot achieve economies of scope

Q: ________ determines how much value is created at the conversion stage. A) The way an organization chooses and obtains the inputs it needs to produce goods and services from its environment B) The method used by an organization to sell its products or services to the customers C) The feedback received by an organization from its customers about its products or services D) The way an organization uses human resources and technology to transform inputs into outputs

Q: Which of the following is an output created by an organization? A) capital B) competitors C) machinery D) salaries

Q: Which of the following is a part of an organizations' inputs? A) salaries B) suppliers C) money and capital D) shareholders

Q: Which of the following is a part of an organization's environment? A) machinery B) suppliers C) money and capital D) raw materials

Q: Robert decided to create a Web site for buying and selling electronic products and he only recruited people who could provide high-quality, customer-friendly service that would appeal most to his Internet customers. This shows that Robert is trying to create value at the ________ stage. A) input B) conversion C) output D) feedback

Q: Jeffrey Bezos saw the opportunity to sell books over the Internet, which was growing. So he started a Web site where people could buy new books and sell there existing books. This was the first Web site dedicated to buying or selling books. This is an example of ________. A) social loafing B) parallel marketing C) surface bargaining D) entrepreneurship

Q: ________ is the process by which people recognize opportunities to satisfy needs and then gather and use resources to meet those needs. A) Moonlighting B) Benchmarking C) Entrepreneurship D) Social loafing

Q: Operative goals can be either short or long term in nature.

Q: Increasing product quality and reducing number of defects are examples of indicators used to measure organizational effectiveness as per the internal systems approach.

Q: The internal systems approach to measuring organizational effectiveness evaluates an organization's ability to convert skills and resources efficiently into finished goods and services.

Q: The technical approach to measuring organizational effectiveness evaluates an organization's ability to secure, manage, and control scarce and valued skills and resources.

Q: The external resource approach to measuring organizational effectiveness evaluates an organization's ability to be innovative and function quickly and responsively.