Management, 3e (Hitt)
Chapter 15 Organizational Change and Development
1) Managing the change process in an organization is easy as the need for change is usually
obvious.
2) The causes of organizational change originate exclusively from internal forces.
3) A major driver of organizational change is the external environment in which the organization
exists.
4) When the economy weakens, most companies consider adding new services or products.
5) Many nonbusiness organizations, especially governmental agencies, contract or expand in
relation to economic conditions because external forces directly impact their budgets.
6) Most businesses and many other organizations are likely to be insensitive to moves made by
their direct competitors, especially those in response to changes in the market or customers’
preferences.
7) The actions of direct competitors can trigger changes inside a given organization, even when
that organization would prefer not to make any changes.
8) Changing societal attitudes toward certain products or services is a change that is quick to
develop and easy to detect.
9) Changing the structural makeup of organizations is sometimes one of the least valuable tools
managers have to create other desired changes.
10) Changes in a firm’s processes and procedures often come about because of earlier changes in
the organization’s strategy or structure.
11) Altering the composition of an existing job is an organizational change made at the
intermediate level.
12) It is crucial to make an accurate assessment of the strength of the forces behind the need for
change.
13) The fact that making changes is a costly process puts a premium on not making changes if
the costs outweigh the potential benefits.
14) Change is typically stimulated when something is anticipated to change or actually changes
in the environment.
15) One of the biggest determinants of resistance during the unfreezing stage of the change
process is the level of uncertainty associated with the change.
16) Inertia, mistrust, and lack of information can cause problems during the movement stage of
the change process.
17) Once managers are successful in getting others to see the need for change, they do not
encounter further resistance in the moving stage of the change process.
18) Force field analysis suggests that increasing the driving forces of change is the best way to
bring about organizational change.
19) A leading coalition is a group that support the change but do not have much influence on
others.
20) Managers usually choose slow rates of change for determining who can keep up to the
organization’s goals and who cannot.
21) Managers must evaluate the change outcomes to know whether additional changes are
needed and to understand if the particular approaches implemented should be used again in
similar circumstances.
22) The organizational development approach to change has a strong behavioral and people
orientation.
23) The fundamental assumption about organizations in the organizational development (OD)
approach is that they are systems composed of interdependent parts.
24) Which of the following is an internal force of change for a company?
A) economic conditions
B) technological developments
C) demographic shifts
D) managerial decisions
25) According to the 2005 “Consumer Choice” report sponsored by Autobytel.com, consumers’
preference for smaller SUVs with decent gas mileage had increased. Which of the following
forces for change probably caused this increase?
A) economic conditions
B) competitors’ actions
C) technology developments
D) legal developments
26) IBF Industries, Inc. is a leading manufacturer and marketer of skin care and solar filters in
the United States. The company is a market leader in the U.S., and the demand for its products
has been static over the last five quarters. In order to achieve better growth, the management is
now planning to develop its business by entering the Canadian market. Which of the following
information, if true, would most support the management’s decision to develop the market?
A) The Canadian online census conducted in the year 2011 showed that the number of people in
Canada over age 60 would increase by over 30 percent in five years.
B) The unemployment rate and unemployment benefit claims in Canada are reported to be higher
than last year.
C) The per capita income and the average purchasing power of the people in Canada have
increased by two percent in last six months.
D) The assent prices in Canada, such as homes and financial assets, have been decreasing for the
last ten months.
27) Which of the following, if true, would be most likely to make a company implement an
immediate organizational change?
A) change in the economic conditions of the country
B) change introduced by a direct competitor that affects profits
C) change in high-ranking managers in the organization
D) change in societal attitudes toward products
28) Due to the rise in the rates of obesity and lifestyle diseases like diabetes and hypertension,
many people have begun opting for healthier diets. This has taken a toll on the fast food and
beverage industry. This is an example of which of the following external forces of change?
A) change in technological developments
B) change in economic conditions
C) change in societal attitudes
D) change in legal and political issues
29) For more than 200 years, Encyclopedia Britannica was believed to be the most authoritative
encyclopedia in the world. However, sales began to plummet when Microsoft started bundling
Encarta with its software products. Britannica offered digital versions of its encyclopedia, but
priced them high to encourage consumers to purchase its nicely bound volumes. The plan failed.
Sales have continued to spiral downward after Wikipedia, a free online encyclopedia, gained
popularity. Which of the following statements sums up this scenario most clearly?
A) Technology has positively influenced the publishing industry.
B) Products with strong brand-name recognition can withstand external threats.
C) Information posted on the Internet is more reliable than hardcopy information.
D) Managers being slow to respond to technological changes can result in loss of business.
30) As a demographic pattern, the aging of populations in the United States and Japan
exemplifies a(n) ________.
A) volatile external force of change
B) slow-moving external force of change
C) transitional external force of change
D) inconsequential external force of change
31) Apart from managers, which of the following groups are often an excellent source of
innovative suggestions for change?
A) shareholders
B) retailers
C) lower level employees
D) suppliers
32) Which of the following forces for change was illustrated when workers at the Port of Los
Angeles opposed the introduction of new cargo-handling technologies?
A) managerial decisions
B) global business influences
C) technological breakthroughs
D) employee preferences and pressures
33) Which of the following best defines “transformational changes”?
A) changes in shared values and strategy
B) long-term changes in technology and staff
C) dynamic changes in systems and structure
D) particularly complex and comprehensive changes
34) Generally, when a company institutes a change to counter that of a rival company, it is
making a change in its ________.
A) structure
B) staffing
C) strategy
D) systems
35) ________ are mostly charged with determining an organization’s strategy.
A) Top level managers
B) Lower level managers
C) Shareholders
D) Human resource personnel
36) In early 2007, Cadbury Schweppes announced its intention to separate its U.S. beverage
division from its core confectionery business. In this case, Cadbury Schweppes was focusing on
________.
A) changing its staff
B) changing its culture
C) changing its structure
D) changing its systems
37) Within the context of organizational change, which of the following practices focus on
shared values and culture?
A) replacing batching with continuous-flow manufacturing
B) encouraging cooperation through a cross-training program
C) changing from a niche market to a general market approach
D) instituting participatory decision making throughout the organization
38) A company is suffering sales setbacks because a competitor has launched an identical
product in the market. The company decides to improve its product design by adding additional
features that would differentiate its offerings from those of the competitors. In this example, the
focus of change is ________.
A) systems
B) technology
C) staff
D) structure
39) After winning a huge contract to build an expressway, AZ Builders Corp. has decided to
create a cross-functional team that will be made up of experts from different fields, including
civil engineers, architects, and accountants. The company’s board of directors also decides to
institute a one-month training program for this group in order to help them shape the goals and
plans to implement this project. In this example, the focus of change is ________.
A) systems
B) technology
C) staff
D) structure
40) Which of the following changes is common at the intermediate level of an organization?
A) dividing departments
B) consolidating major divisions
C) forming new project groups
D) altering job compositions
41) Google’s purchase of YouTube exemplifies its ________ of the need to enhance its mission
of organizing the world’s information and making it universally useful and accessible.
A) proactive recognition
B) reactive recognition
C) cybernetic recognition
D) retroactive recognition
42) Within the context of organizational change, the most lasting people-change approach
usually involves ________.
A) adjusting people’s attitudes and expectations
B) adding, subtracting, or interchanging people
C) enhancing people’s knowledge, skills, and abilities
D) changing how staff members relate to one another
43) Which of the following is the most people-oriented change focus used within an
organization?
A) adding, subtracting, or interchanging people
B) attempting to change how staff members relate to each other
C) getting the manager to provide new information
D) directly enhancing knowledge, skills and abilities
44) AOL’s shift in strategy from generating revenues via consumer subscriptions to generating
revenue via advertising on its website is an example of ________ of the need for change.
A) proactive recognition
B) reactive recognition
C) cybernetic recognition
D) retroactive recognition
45) Senior executives at NEC were unwilling to listen to younger scientists who said that LCD
technology would appeal to customers who wanted computer monitors with high resolution and
a smaller desktop footprint. According to Lewin’s theory of change, this scenario depicts
problems at the ________ of the change process.
A) unfreezing stage
B) movement stage
C) refreezing stage
D) engagement stage
46) The manager of a chain of fast-food restaurants has noticed that the number of breakfast
customers has fallen by 50 percent in the last 6 months. The manager believes this precipitous
decline may be due to the extensive marketing campaign a competitor is running to promote its
“good-to-go” breakfast menu. Which of the following steps would be most likely to regain the
lost customers?
A) retrain the members of the breakfast crew
B) introduce exotic items on the breakfast menu
C) match the competitors ad campaign but with lower prices
D) survey staff and customers on what changes need to be implemented
47) As a reason for resistance to change, the term inertia means ________.
A) lacking adequate information about the need for change
B) being comfortable with the present way of doing things
C) mistrusting those who are communicating the need for change
D) refusing to believe that change is necessary or helpful
48) Which of the following statements is true about the movement phase of the change process?
A) The greater the magnitude of change, the greater is the level of uncertainty.
B) The lesser the uncertainty regarding a change, the greater the resistance to it.
C) The greater the magnitude of the change, the lesser the level of resistance to it.
D) The higher the level of resistance to a change, the lesser planning is required for its success.
49) Research has shown that the ________ is one of the biggest determinants of resistance
during the movement stage of the change process.
A) pull of past competencies
B) unreliability of workplace technology
C) level of uncertainty associated with the change
D) inability of management to articulate the need for change
50) A sales manager announces that all weekly sales reports must be submitted via e-mail, rather
than hardcopy. However, some of the veteran staff members are still putting their reports in the
manager’s office mailbox. Which of the following would be the least effective way of winning
over those who are resistant to this change?
A) providing all required hardware, software, and training
B) explaining how electronic submissions save time, paperwork, and money
C) praising staff when they successfully submit their reports electronically
D) stressing that younger staff members have no problem e-mailing their reports
51) Which of the following techniques will be the least likely to overcome employee resistance
during the moving stage of the change process?
A) educating them about the nature of the desired change
B) communicating how the change will affect them in a positive way
C) announcing that the change has been mandated by top management
D) making sure that they have the required knowledge, skills, and abilities
52) Which of the following is true of Lewin’s concept of refreezing as the third phase of the
change process?
A) The new state should not allow reversal.
B) The new state should be static.
C) The new state should not be monitored.
D) The new state should not be adjusted.
53) The line managers at Harmony Corp. believe that the introduction of the customer care
hotline facility has been a huge mistake. They are overwhelmed by the number of complaints
that come in each day, most of which are due to faulty usage and not faulty products. The top
executives at Harmony believe that the hotline will prove its worth over time. What inference
can be drawn from this scenario?
A) The dissatisfaction is due to pull of past competencies.
B) The dissatisfaction is due to nonimmediate results.
C) The dissatisfaction is due to lack of capabilities.
D) The dissatisfaction is due to lack of information.
54) In order to recover its market share, the management in Xenon Inc. decide to launch a low
cost line of its existing products. Which of the following arguments would most likely convince
the reluctant employees of the feasibility of this strategy?
A) Cheaper raw materials would make for a cheaper product.
B) Competitors were offering goods at low prices.
C) Company is currently making a product that has low demand.
D) New technology would help mass production and price reduction.
55) A furniture manufacturer instituted a new strategy of producing custom-designed kitchen
fittings rather than predesigned fittings. Although the amount of fittings produced by the
company fell as the new plan was implemented, management was quick to point out that the
custom fittings sold faster (and at a higher profit margin) than the predesigned fittings. What
strategy is management using to overcome the pull of past patterns and build momentum in
moving toward new patterns?
A) benchmarking
B) celebrating early wins
C) unfreezing
D) behavioral process orientation
56) Which of the following is important for a manager to do in the refreezing phase of
organizational change in addition to providing positive reinforcement to the employees?
A) provide feedback
B) build momentum
C) supply resources
D) explain desired goals