Chapter 10—Designing Adaptive Organizations
TRUE/FALSE
1. The deployment of organizational resources to achieve strategic goals refers to organizing.
2. Organizing defines what to do while strategy defines how to do it.
3. The framework in which the organization defines how tasks are divided, resources are deployed and
departments are coordinated is called organizational structure.
4. A organizational map is a visual representation of an organization’s structure, showing communication
and lines of power.
5. Despite the apparent advantages of specialization, many organizations are moving away from this
principle.
6. The principle of unity of command suggests that managers within an organization should reach
agreement on the goals and objectives of the organization.
7. Authority is the right to use resources, make decisions and issue orders in an organization.
8. The duty to perform the task or activity an employee has been assigned is called accountability.
9. Most organizations today discourage managers to delegate authority to the lower levels given the
challenges to meet customer needs and adapt to the environment.
10. The acceptance theory of authority argues that managers have authority because employees do not
have a choice in choosing to accept their commands.
11. Line departments perform tasks that reflect the organization’s primary goal and mission.
12. The right to advise, recommend, and counsel in the staff specialists’ area of expertise is included in
staff authority.
13. The number of employees reporting to a supervisor is his or her span of management.
14. Traditional views of organizational design recommend a span of management of about 7 to 10
subordinates per manager.
15. Many hierarchical levels and a correspondingly narrow span of management refers to a flat structure.
16. The trend in recent years has been toward narrower spans of control as a way to facilitate delegation.
17. A tall structure is a management structure characterized by an overall narrow span of management and
a relatively large number of hierarchical levels.
18. Certainty in the environment is usually associated with decentralization.
19. The basis for grouping positions into departments and departments into the total organization is
referred to as departmentalization.
20. For companies to operate effectively, the amount of centralization or decentralization should fit the
firm’s strategy.
21. At Fox End, people are grouped together in departments by common skills and work activities,
including a sales department and a production department. This is an example of vertical functional
approach.
22. The functional structure offers a way to decentralize decision making and provide direction from the
teams in the field.
23. Because the chain of command converges at the top, the functional structure provides a way to
decentralize decision making and provide unified direction from all managers.
24. Quick response to external changes is an advantage of vertical functional structure.
25. Divisions are created, in functional structures, as self-contained units with separate functional
departments for each division.
26. The divisional structure encourages decentralization.
27. In a geographic-based structure, all functions in a specific country or region report to the same division
manager.
28. With a matix structure, the entire organization is made up of horizontal teams that coordinate their
work and work directly with customers to accomplish the organization’s goals.
29. Aspects of both functional and divisional structures simultaneously in the same part of the
organization are combined in the virtual network approach.
30. The horizontal structure provides traditional control within functional departments, and the vertical
structure provides coordination across departments.
31. The confusion and frustration caused by the dual chain of command is a major problem of the matrix
structure.
32. The overseer of both the product and functional chains of command, responsible for the entire matrix
is the matrix boss.
33. The modular approach is similar to virtual networking.
34. The divisional structure fosters excellent coordination within divisions, but coordination across
divisions is often poor.
35. In the divisional approach, coordination across divisions is great whereas coordination within divisions
is often poor.
36. The matrix approach can be highly effective in a complex, rapidly changing environment in which the
organization needs to be flexible and adaptable.
37. One major disadvantage of the virtual network approach is the lack of hands-on control.
38. Coordination refers to the managerial task of adjusting and synchronizing the diverse activities among
different individuals and departments.
39. Reengineering is the outcome of information and cooperation.
40. A project manager is a person responsible for coordinating the activities of several departments for the
completion of a specific project.
41. Reengineering basically means preserving the past by establishing the sequence of activities by how
work was done.
42. The radical redesign of business processes to achieve dramatic improvements in cost, quality, service,
and speed is called reengineering.
43. The distinctive feature of the project manager position is that the person is not a member of one of the
departments begin coordinated.
44. When an organization uses a differentiation strategy, it strives for internal efficiency.
45. The pure functional structure is appropriate for achieving internal efficiency goals.
46. A rigid, vertical structure in an uncertain environment prevents the organization form adapting to
change.
47. The functional structure is appropriate when the primary goal is innovation and flexibility.
48. Small-batch production is distinguished by standardized production runs.
MULTIPLE CHOICE
1. Which of the following refers to the deployment of organizational resources to achieve strategic goals?
a.
Planning
b.
Controlling
c.
Organizing
d.
Leading
e.
Strategic management
2. Strategy defines _____ to do (it) while organizing defines _____ to do (it).
a.
how; what
b.
how; why
c.
what; how
d.
what; why
e.
when; what
3. Organizational structure includes which of these?
a.
The set of formal tasks assigned to individuals
b.
The set of formal tasks assigned to departments
c.
The design of systems to ensure effective coordination of employees across departments
d.
Formal reporting relationships
e.
All of these are part of organizational structure.
4. Organization structure is defined as the:
a.
visual representation of the organization.
b.
framework in which the organization defined how tasks are divided, resources are
deployed, and departments are coordinated.
c.
division of labor.
d.
unbroken line of authority that links all individuals in the organization.
e.
none of these.
5. The organization chart:
a.
shows the characteristics of the organization’s vertical structure.
b.
is a visual representation of the organization‘s structure.
c.
details the formal reporting relationships that exist within an organization.
d.
all of these.
e.
both shows the characteristics of the organization’s vertical structure and is a visual
representation of the organization’s structure.
6. The _____ delineates the chain of command, indicates departmental tasks and how they fit together,
and provides order and logic for the organization.
a.
management chart
b.
employee directory
c.
structural table
d.
administrative chart
e.
organizational chart
7. Which of the following refers to the degree to which organizational tasks are subdivided into
individual jobs?
a.
Multitasking
b.
Lines of authority
c.
Work specialization
d.
Autonomy
e.
Team structure
8. When work specialization is extensive:
a.
employees perform a single task.
b.
employees perform many tasks.
c.
employees are often highly challenged.
d.
employees are often inefficient.
e.
jobs tend to be large.
9. Louise works in the manufacturing department at Ice Sculptures. The work in Louise’s department is
low in task specialization. As a result, Louise:
a.
usually performs a single task.
b.
does a variety of tasks and activities.
c.
is often bored.
d.
is rarely challenged.
e.
generally goofs-off.
10. _____ is also referred to as work specialization.
a.
Division of labor
b.
Unity of command
c.
Scalar chain
d.
Esprit de corps
e.
Virtual network approach
11. Jacob was recently looking at his company’s organization chart in an attempt to discover who reports
to whom. Jacob is studying his organization’s:
a.
degree of formalization.
b.
amount of differentiation.
c.
degree of centralization.
d.
chain of command.
e.
division of labor.
12. Unity of command and the scalar principle are both closely related to the:
a.
amount of work specialization in an organization.
b.
degree of formalization.
c.
chain of command.
d.
amount of bureaucracy in the organization.
e.
matrix structure.
13. _____ means that each employee is held accountable to only one supervisor.
a.
Scalar principle
b.
Unity of command
c.
Work specialization
d.
Division of labor
e.
Span of management
14. The formal and legitimate right of a manager to make decisions is _____.
a.
delegation
b.
responsibility
c.
authority
d.
span of management
e.
leadership
15. _____ refers to a clearly defined line of authority in the organization that includes all employees.
a.
Scalar principle
b.
Unity of command
c.
Work specialization
d.
Division of labor
e.
Span of management
16. Rebecca works for a company that has clearly defined lines of authority. Each employee knows that he
or she has authority and responsibility for a distinct set of tasks. Employees are also aware of the
company’s reporting structure as well as successive management levels all the way to the top.
Rebecca’s company follows which principle?
a.
Specialization principle
b.
Unity of command principle
c.
Scalar principle
d.
Authority principle
e.
Responsibility principle
17. How does managerial authority flow through the organizational hierarchy?
a.
Vertically
b.
Sporadically
c.
Horizontally
d.
In a circular fashion
e.
Authority is static – it does not flow
18. The people with authority and responsibility are subject to reporting and justifying task outcomes to
those above them in the chain of command. This is called _____.
a.
delegation
b.
line authority
c.
staff authority
d.
accountability
e.
hierarchy
19. Which of the following characteristics distinguishes authority?
a.
It is vested in people, not positions.
b.
Subordinates accept it.
c.
It flows across the horizontal hierarchy.
d.
It emerges from the organizational values.
e.
Individuals are born with this power.
20. Gina wishes to transfer authority and responsibility to her subordinates. This process is known as:
a.
accountability.
b.
coordination.
c.
delegation.
d.
departmentalization.
e.
passing the buck.
21. Which of the following typically is NOT considered a staff department?
a.
Strategic planning
b.
Accounting
c.
Manufacturing
d.
Human resources
e.
Research and development
22. Which department performs tasks that reflect the organization’s primary goals and mission?
a.
Line
b.
Staff
c.
Primary
d.
Functional
e.
Strategic planning
23. _____ departments include all of those that provide specialized skills in support of _____ departments.
a.
Line; staff
b.
Staff; line
c.
Primary; functional
d.
Functional; primary
e.
Line; functional
24. Carly’s Clothes, Inc. manufactures children’s clothes. Which of the following departments for Carly’s
Clothes can be considered a line department?
a.
Finance department
b.
Human Resources department
c.
Research and development department
d.
Manufacturing department
e.
Marketing department
25. Which of the following refers to the number of employees reporting to a supervisor?
a.
The line of authority
b.
The span of management
c.
The chain of command
d.
The management chain
e.
Delegation
26. Traditionally, a span of management of about _____ has been recommended.
a.
three
b.
five
c.
fifteen
d.
seven
e.
twenty
27. Shoshanna is manager of a customer service firm where she oversees five subordinates. To help her
subordinates learn more about the different roles within the company, Shoshanna regularly assigns
them tasks that are not part of their normal routine. This is an example of:
a.
responsibility
b.
delegation
c.
authority
d.
chain of command
e.
irrational decision making
28. Dustin’s subordinates are highly trained and all perform similar tasks. Brittany’s subordinates are
spread over two locations and she has little available in the way of support systems. Which of the
following statements is most correct?
a.
Duston’s span of management can be larger than Brittany’s.
b.
Dustin will have problems with unity of command.
c.
Brittany’s span of management can be larger than Dustin’s.
d.
Brittany has more problems with work specialization.
e.
None of these
29. Which of the following organizations has a flatter structure than the others?
a.
Organization A with eleven hierarchical levels
b.
Organization B with three hierarchical levels
c.
Organization C with eight hierarchical levels
d.
Organization D with six hierarchical levels
e.
Organization E with seven hierarchical levels
30. Which of the following factors is NOT associated with larger span of control?
a.
Work performed by subordinates is stable and routine.
b.
Subordinates perform similar work tasks.
c.
Subordinates are located at various different locations.
d.
Subordinates are highly trained and need little direction.
e.
Rules and procedures defining task activities are available.
31. Relative to a flat organizational structure, a tall structure has a _____ span of management and _____
hierarchical levels.
a.
wide; fewer
b.
narrow; fewer
c.
narrow; wider
d.
narrow; more
e.
wide; more
32. _____ is the trend in organizational structure in recent years.
a.
Greater work specialization
b.
Less delegation
c.
Wider spans of management
d.
Narrower spans of management
e.
Tall structure
33. Barney and Betty work at Mountain Peak, Inc. Although they both work on the assembly line, they
have the authority to make many decisions about their job. Mountain Peak can be said to have:
a.
a high degree of decentralization.
b.
a wide span of management.
c.
a high degree of centralization.
d.
a narrow span of management.
e.
no management.
34. _____ means that decision authority is located near the _____ of the organization.
a.
Centralization; bottom
b.
Decentralization; top
c.
Centralization; top
d.
Centralization; middle
e.
None of these
35. Change and uncertainty in the environment are usually associated with _____.
a.
work specialization
b.
decentralization
c.
centralization
d.
tight vertical control
e.
division of labor
36. Which of the following is the basis for grouping positions into departments and departments into the
total organization?
a.
Departmentalization
b.
Centralization
c.
Decentralization
d.
Formalization
e.
Specialization
37. Jacob, a customer service representative for AB Retailers, has seven levels of management between
himself and the company’s CEO. In contrast, his friend Rhonda, a customer service representative for
YZ Retailers, has only four levels of management between her and the company CEO. Compared to
YZ, Jacob’s company has what type of organizational structure?
a.
Narrow
b.
Wide
c.
Flat
d.
Tall
e.
Identical
38. The functional, _____, and _____ are traditional approaches that rely on the chain of command to
define departmental groupings and reporting relationships along the hierarchy.
a.
divisional, teams
b.
divisional, matrix
c.
matrix, teams
d.
matrix, networks
e.
teams, networks
39. The use of teams may lead to too much:
a.
division of labor.
b.
decentralization.
c.
authority and responsibility in top management’s hands.
d.
formalization.
e.
narrow span of management.
40. When departments are grouped together on the basis of organizational outputs, the organization is
using a:
a.
functional structure.
b.
matrix structure.
c.
divisional structure.
d.
virtual network structure.
e.
team-based structure.
41. Self-contained unit structure is a term used for:
a.
divisional structure.
b.
functional structure.
c.
term structure.
d.
matrix structure.
e.
virtual network structure.
42. Relative to the functional structure, the divisional structure:
a.
encourages decentralization.
b.
has a higher degree of work specialization.
c.
has a more pronounced division of labor.
d.
has excellent coordination across departments.
e.
results in an efficient use of resources.
43. Theresa works in an organization where coordination across organizational units is poor and the units
perceived themselves to be in competition with one another for organizational resources. These
characteristics are consistent with which of the following structures?
a.
A matrix structure
b.
A functional structure
c.
A divisional structure
d.
A team-based structure
e.
A virtual network structure
44. All functions in a specific country or region report to the same division manager in _____ divisions.
a.
functional
b.
matrix
c.
geographic-based
d.
teams
e.
networks
45. Global companies often use a _____ structure to achieve simultaneous coordination of products across
countries.
a.
functional
b.
divisional
c.
matrix
d.
product-based
e.
process-based
46. A formal chain of command for both functional and divisional relationships is provided by the _____
approach to structure.
a.
matrix
b.
vertical functional
c.
divisional
d.
product
e.
team-based
47. Kent works at the Tick Tock, Inc. He has two bosses, one a functional manager and the other a
divisional manager. Tick Tock, Inc. has a _____ structure.
a.
functional
b.
divisional
c.
geographic
d.
matrix
e.
product
48. Disadvantages of the virtual network approach include:
a.
a lack of hands-on control.
b.
the possibility of losing an important part of the organization.
c.
weakened employee loyalty.
d.
all of these.
e.
a lack of hands-on control and weakened employee loyalty.
49. Salta Communications is a global telecommunications company that has operations on four continents.
The CEO’s direct supervisors include VPs for the North American South American, European, and the
Asian divisions. Salta can best be described as using what organizational structure?
a.
Network
b.
Matrix
c.
Functional
d.
Divisional
e.
Geographic
50. The matrix structure violates which of the following principles of management?
a.
Unity of direction
b.
Unity of command
c.
Work specialization
d.
Division of labor
e.
Span of management
51. All of the following are the major disadvantages of the matrix structure EXCEPT:
a.
it generates a large amount of conflict.
b.
managers spend much time resolving conflict.
c.
the confusion caused by the dual chain of command.
d.
the power imbalance that can result between the sides of the matrix.
e.
enlarged tasks for employees.
52. Juan is a top manager at I.F.L., a matrix organization. He oversees both the product and functional
chains of command, and is responsible for maintaining a power balance between the two sides of the
matrix. Juan is a _____.
a.
political leader
b.
functional leader
c.
divisional leader
d.
matrix leader
e.
top leader
53. The _____ is the product or functional boss, who is responsible for one side of the matrix.
a.
matrix boss
b.
production supervisor
c.
department boss
d.
top leader
e.
two-boss employee
54. _____ teams are brought together as a formal department in the organization.
a.
Cross-functional
b.
Permanent
c.
Formal
d.
Ad-hoc
e.
Task
55. Walt works for a large company. Recently, his organization began to contract out such functions as
training, engineering, and computer service. This approach is consistent with a _____ structure.
a.
functional
b.
team
c.
divisional
d.
virtual network
e.
service
56. The _____ is an organization structure that divides the major functions of the organization into
separate companies.
a.
diversification approach
b.
team approach
c.
virtual network approach
d.
BCG approach
e.
functional approach
57. The _____ is an organization structure that divides the major functions of the organization into
separate companies and coordinates their activities from a small headquarters organization.
a.
diversification approach
b.
team approach
c.
virtual network approach
d.
BCG approach
e.
functional approach
58. In the _____ structure, the organization is viewed as a central hub surrounded by a network of outside
specialists which are sometimes spread all over the world.
a.
virtual network
b.
matrix
c.
functional
d.
divisional
e.
geographic
59. According to MANAGER’S SHOPTALK in Chapter 10, all of the following are effective ways for a
manager to delegate EXCEPT:
a.
delegate the whole task.
b.
select the right person.
c.
save feedback for completion of the project.
d.
evaluate and reward performance.
e.
give thorough instruction.
60. In the _____ approach, a manufacturing company uses outside suppliers to provide entire chunks of a
product, which are then assembled into a final product by a handful of workers.
a.
virtual network
b.
modular
c.
virtual organization
d.
team
e.
matrix
61. The biggest advantage to a virtual network approach is _____ and _____ on a global scale.
a.
flexibility; competitiveness
b.
coordination; organization
c.
communication; organization
d.
communication; no cost
e.
flexibility; coordination
62. All of the following are advantages of a functional structure EXCEPT:
a.
economies of scale.