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Management
Q:
A global start-up faces many management challenges including _____________.
A. communication and coordination across time zones
B. pressure to perform internally all primary activities of the value chain
C. assuring financing from home country only
D. hiring only from home country
Q:
The relationship between strategy and structure can be best described as _____________.
A. strategy determines structure but structure does not determine strategy
B. structure determines strategy but strategy does not determine structure
C. strategy and structure influence each other
D. a third force determines both strategy and structure
Q:
If an international firm has a global strategy and a relatively low level of product diversity, the best choice for its organizational structure is ______________ structure.
A. a worldwide functional
B. a worldwide product division
C. a worldwide matrix
D. an international division
Q:
If an international firm has a multidomestic strategy and a relatively high level of product diversity, the best choice for its organizational structure is ______________ structure.
A. a worldwide functional
B. a worldwide product division
C. a worldwide matrix
D. an international division
Q:
Generally speaking, discussions of the relationship between strategy and structure strongly imply that _____________.
A. strategy follows structure
B. structure follows strategy
C. strategy can effectively be formulated without considering structural elements
D. structure typically has a very small influence on the strategy of a firm
Q:
Which of the following is considered to be an advantage of a matrix structure?
A. the layering of matrices
B. increased clarity in reporting relationships
C. increased responsiveness to the market
D. fewer power struggles and reduced conflict
Q:
Complicated working relationships, intense power struggles, and excessive reliance on group processes are disadvantages of which type of organizational structure?
A. divisional
B. matrix
C. holding company
D. functional
Q:
A matrix organizational structure is characterized by a combination of the ______________ and _____________.
A. functional structure; divisional structure
B. simple structure; functional structure
C. simple structure; divisional structure
D. holding company structure; divisional structure
Q:
Strategic business unit (SBU) structures are best suited for corporations pursuing _____________, whereas holding company structures are best suited for companies with ______________ strategies.
A. product-market diversification; international
B. international diversification; product-market
C. related diversification; unrelated diversification
D. unrelated diversification; related diversification
Q:
Strategic business unit (SBU) and holding company structures result from extensive _____________.
A. diversification
B. vertical integration
C. international expansion
D. organizational flattening
Q:
Important advantages of a holding company structure include _____________.
A. savings in personnel and overhead expenses associated with a small corporate office
B. a high level of awareness at the corporate office of issues facing individual divisions
C. a high level of control of division executives by executives at the corporate level
D. gaining synergistic benefits across businesses
Q:
Which of the following is not an advantage of a strategic business unit (SBU) type of organizational structure?
A. Divisions with similar products, markets, or technologies are formed into homogeneous groups that can achieve synergies.
B. Divisional executives can respond quickly to market changes and opportunities.
C. Planning and control by the corporate office is more manageable.
D. The corporate office is more removed from the individual divisions.
Q:
An organization such as ConAgra that has dozens of different divisions with similar products will probably have the greatest success with which form of organization structure?
A. functional structure
B. matrix structure
C. strategic business unit structure
D. holding company structure
Q:
Which of the following is not a disadvantage of a divisional type of organizational structure?
A. It can be very expensive compared to a functional organizational structure.
B. There is a strong tendency for divisions to focus on short-term performance.
C. There can be dysfunctional competition among divisions.
D. There is separation of strategic and operating control.
Q:
Which of the following is an advantage of a divisional type of organizational structure?
A. efficient use of managerial and technical talent
B. an enhanced ability to respond quickly to changes in the external environment
C. high degree of emphasis on long-term performance
D. uniformity in image and quality across divisions
Q:
Which of the following is a disadvantage of a functional type of organizational structure?
A. Differences in functional orientation may impede communication and coordination.
B. Use of managerial and technical talent is inefficient due to pooling of expertise in functional areas.
C. Decision making is centralized at the top of the organization.
D. Managers tend to be overly concerned with long-term strategies that minimize the importance of functional area strengths.
Q:
Which of the following is an advantage of a functional type of organizational structure?
A. Decentralized decision-making enhances an organization-wide perspective across functions.
B. It facilitates the development of general management talent.
C. Pooling of specialists enhances coordination and control.
D. It is easy to establish uniform performance standards.
Q:
Functional structures are usually found in organizations where _____________.
A. there is high volume production
B. there are unrelated product lines or service offerings
C. there is very little vertical integration
D. there exists a strong need to decentralize decision making
Q:
A simple structure is characterized by _____________.
A. high specialization and low centralization
B. low specialization and high centralization
C. low formality and low creativity
D. high formality and low centralization
Q:
Which of the following statements about simple organizational structures is not true?
A. Small firms with a narrow product-market scope will adopt such a structure.
B. Decision making authority is highly centralized.
C. There is little specialization of tasks.
D. Creativity and individualism are rare.
Q:
A strategy of related diversification requires most firms to organize around geographical areas or product lines. This type of organizational growth leads to ______________ structure.
A. a divisional
B. a functional
C. a matrix
D. an international
Q:
When an organization with a functional structure diversifies into related product-markets, it generally _____________.
A. maintains its functional structure
B. develops a divisional structure
C. develops a matrix structure
D. develops a worldwide product-division structure
Q:
When an organization with a simple structure increases its sales revenue and volume of outputs, it is most likely to develop a ______________ structure.
A. divisional
B. functional
C. product-market
D. geographic
Q:
Which of the following is not a primary factor that a large firm with international operations should consider when choosing the appropriate structure for its organization?
A. the extent of international expansion
B. the type of strategy (global, multidomestic, or transnational)
C. the degree of product diversity
D. the degree of market diversity
Q:
In large organizations, a strategy of diversification requires a need to reorganize around ______________ or _____________.
A. product lines; geographic markets
B. product lines; competition
C. competitor lines; geographic markets
D. distribution lines; competitor markets
Q:
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.
Q:
Procter and 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.
Q:
One of the advantages of boundaryless structures is that they can be implemented without upgrading the skills of workers and managers.
Q:
Horizontal organization structures facilitate resource sharing and help to create a sense of common purpose.
Q:
Managing virtual structures requires new and difficult-to-acquire managerial skills.
Q:
The virtual organization is characterized by participating firms which pursue a collective strategy that enables them to cope with environmental uncertainty through cooperative efforts.
Q:
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.
Q:
One of the risks of outsourcing is a loss of cross-functional skills.
Q:
Outsourcing relieves companies of the requirement to maintain skill levels needed to manufacture essential components.
Q:
Modular companies can achieve rapid growth because they do not require large investments in fixed assets.
Q:
Because the modular form of organizing involves outsourcing vital functions, modular firms often forfeit full strategic control.
Q:
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.
Q:
Managers trained in rigid hierarchies do not find it difficult to transition to participative style required for effective teamwork.
Q:
A barrier-free organization creates successful relationships between internal and external constituencies and sometimes with competitors as well.
Q:
According to the text, the factor that most distinguishes a superior team from a good team is talent.
Q:
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.
Q:
An advantage of the barrier-free form of organizing is that internal cooperation and shared objectives are not required for it to work.
Q:
In a barrier-free organization, differences in skills, authority, and talent disappear.
Q:
Different types of boundaries place limits on organizations in order to foster high degrees of interaction with inside influences and varying levels of permeability.
Q:
Jack Welch, former CEO of GE, believes that all internal and external organizational boundaries should vanish completely.
Q:
According to the text, boundaryless organizational structures are most effective when they replace rather than complement traditional organizational structures.
Q:
The structure of a firm typically has almost no effect on its strategy.
Q:
Global start-ups occur after a corporation has exhausted all other possibilities for domestic growth.
Q:
A global startup typically benefits from lower communication, coordination, and transportation costs.
Q:
A worldwide product division structure is used when global strategies require that each division be responsible for overall efficiency and performance.
Q:
A major disadvantage of the matrix structure is that it duplicates the use of specialized personnel, equipment, and facilities.
Q:
A matrix organization is organized strictly along product lines.
Q:
The matrix structure attempts to combine the advantages of the functional and product-oriented structure.
Q:
One major advantage of the holding company form of organization structure is that it minimizes the duplication of functional activities between product lines.
Q:
The strategic business unit (SBU) and holding company structure are variants of the functional form of structure.
Q:
A major disadvantage of a divisional structure is that when divisions are separated to manage individual product markets, there is a separation of strategic and operational control.
Q:
A major disadvantage of adopting a divisional structure is the tendency for managers to focus on short-term objectives.
Q:
Operational decision making in a large business places excessive demands on top management of the firm.
Q:
One disadvantage of a functional structure is that differences in functional orientation may impede organization coordination and communication.
Q:
To enhance integration and control of related product market activities, the functional structure minimizes centralization.
Q:
As firms grow, owner managers often need to hire functional specialists to handle the increased information-processing burden.
Q:
A simple organizational structure may lead to problems such as unclear boundaries of authority and few career advancement options.
Q:
A small firm with a simple structure often fosters creativity and individualism because of its informal atmosphere.
Q:
In a simple structure where the owner manager makes most of the important decisions, extensive rules and regulations are used to maintain order.
Q:
When a firm has international operations, choosing the most appropriate structure depends upon the extent of international expansion, the type of strategy, and the degree of market diversity.
Q:
A strategy of related diversification requires a need to reorganize around product lines and geographic markets. This leads to a divisional structure.
Q:
The strategy and structure of a firm change as the firm increases in size, diversifies into new product markets, and limits its geographic scope.
Q:
What is meant by principal-principal (PP) conflict? What are the implications for sound corporate governance?
Q:
Identify at least three external control mechanisms. Discuss the role played by each of these.
Q:
What is meant by the term market for corporate control? How does the market for corporate control act as an external control mechanism?
Q:
Is CEO duality good or bad? Summarize the two schools of thought that represent alternate positions on this issue.
Q:
What are the three key means to align the interests of owners (shareholders) and managers in a corporation?
Q:
What are the characteristics of short-term objectives? Provide examples of practical applications of these characteristics by organizations.
Q:
Discuss the benefits and risks of using reward and incentive systems as a means of strategic control.
Q:
Why is it important to have a balance among the three behavioral controls (culture, rewards, and boundaries)? Is there a danger associated with emphasizing one behavioral approach more than another?
Q:
What are the four characteristics of effective contemporary control systems? Give examples of how firms apply these practices.
Q:
What are the advantages and disadvantages associated with using contemporary approaches to strategic control?
Q:
What are the advantages and disadvantages associated with using traditional approaches to strategic control?
Q:
What value do effective strategic control systems provide to the implementation of strategy?
Q:
Expropriation of minority shareholders means that minority shareholders _____________.
A. must sell their shares upon demand
B. cannot own shares in foreign firms
C. do not receive dividends
D. are adversely affected by the actions of controlling shareholders