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161. Alleta Publishing Company, Inc., is considering the use of cross-functional teams. In order
to be most effective, Alleta should include customers as members of the teams.
162. Barclay developed two interactive computer games. He didn't do it entirely alone. Last
year he started a small company, and hired two programmers and a marketing graduate. He
considers himself a cutting-edge kind of guy and wants to position his company the same way.
He solicits your advice as to how he should structure his organization as he moves forward, and
you suggest that he hire a few potential customers to join his team of employees as product
testers. And, you suggest, maybe he should solicit globally. The structure you have described
would simulate a line-and-staff organization.
163. Julio is the owner of Celebration, Inc., a small party supply company. The company
provides tents, tables, chairs, and related paraphernalia for wedding, Bar Mitzvah, Bat Mitzvah,
graduation, birthday, and other celebratory events. As sales have increased, the organization has
hired 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 line organization model.
164. Networking uses communication technology to link organizations, allowing them to work
together on common objectives.
165. The Internet makes real-time availability of data possible.
166. Transparency describes the relationship between a firm and its stockholders.
167. Transparency allows two companies to work more efficiently together.
168. Most companies are no longer self-sufficient or self-contained.
169. Networking requires transparency to work most effectively.
170. A virtual corporation refers to a permanent network of firms linked by high-tech
communication systems.
171. A virtual corporation is a networked organization made up of replaceable firms that join
the network and leave it as needed.
172. Benchmarking requires organizations to compare each organizational function against the
best in the world.
173. Competitive benchmarking rates an organization's products and operations against the
industry average.
174. Competitive benchmarking compares a company's practices, processes, and products
against others in its industry, with the goal of doing it better than the competition.
175. 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.
176. An organization's core competencies are those functions that the firm performs as well as
or better than anyone else in the world.
177. If a particular function is one of a firm's core competencies, it typically performs this
function itself rather than outsourcing it to another organization.
178. Assigning various functions that a firm might do for itself to outside organizations is
known as competitive allocation.
179. Outsourcing involves assigning various functions to outside organizations.
180. Baby Boomers are often referenced as digital natives.
181. Restructuring involves the redesign of an organization to be more responsive to
customers.
182. To better serve customers, many firms are restructuring to empower front-line employees.
183. New technology such as the Internet has opened up opportunities for firms to sell to new
markets.
184. Digital natives, those who grew up with the Internet, are an important customer group that
most businesses want to reach.
185. Introducing change into an organization is an easy task for a manager.
186. Inverted organizations define the role of front-line employees as those workers who follow
the orders of top and middle management.
187. Inverted organizations empower employees by adding multiple layers of management and
long lines of communication.
188. In an inverted organization, the purpose of management is to assist and support the
decisions of employees who work directly with customers.
189. Companies have learned that working transparently through real-time networks has
provided competitive advantages in the marketplace.
190. Outsourcing has become commonplace, particularly when organizations want to focus on
core competencies.
191. Once a company has restructured a firm to be more competitive in today's market, it
alleviates the need to scan the external environment.
192. The virtual corporation does all its business online with partners considered a permanent
part of the network.
193. The
Spotlight on Small Business
box titled "Cutting Back While Cutting Costs" discusses
the decline of outsourcing jobs in the small business sector. Outsourcing is just for big business.
194. According to the
Spotlight on Small Business
box titled "Cutting Back While Cutting
Costs," the growth of small business outsourcing can be attributed to the presence of online job
marketplaces.
195. According to the
Adapting to Change
box titled "When Open Communication Should Not
Be So Open," France is considering legislation to block work e-mails and phone calls to allow
workers time to rest.
196. Cardinal Foods is a wholesaler serving grocery stores. High-tech communications allows
Cardinal to work closely with its suppliers and customers in real time. Networking allows these
organizations to operate more efficiently.
197. In order to improve services to customers, Northwest Electric, a regional monopoly,
recently rated their company's processes and products against the results achieved by the
world's best at similar processes and products. Northwest Electric has adopted a policy of
international standardization.
198. The Nutmeg Soccer Club outsourced its accounting work. This suggests that
management at Nutmeg does not believe that accounting is one of the firm's core competencies.
199. Last week at Happy Trails Financial Services Company, all financial advisors who serve
more than 150 clients each received a notice from the VP of Operations that every client's
investment portfolio should consist of 50% individual stock purchases, 25% bonds, and 25%
property. Advisors were ordered to review all client portfolios for compliance to this directive.
Clearly, Happy Trails is an inverted organization because management directives such as the one
described are very common.
200. Milton Learning Centers is a private firm specializing in helping students with learning
problems. Located around the country, each center employs a manager and several tutors and
counselors. The counselors and tutors have a great deal of flexibility to design programs
specifically for individual students. In fact, these first-line employees are considered to be the
key people in the organization, and the manager's main function is to assist these employees in
matters such as scheduling and securing necessary materials. This type of arrangement suggests
that Milton is an inverted organization.
201. Jason is a self-employed patent attorney. These days he is seldom without work. Large
corporations hire him on an as-needed basis to review prospective ideas and help with securing
patents for a variety of inventions including surgical instruments, medicines, and high-tech
gadgets. Once he secures a contract, Jason knows approximately how many weeks or months he
will work. Jason works for virtual corporations.
202. Ben was confident that sports fans would fill the seats in his brewery restaurant after
major league baseball games if they just knew about the place. After all, he offered convenience,
easy walking distance, great local talent for entertainment and several fresh premium brews. He
decided to join sites such as Twitter and Facebook, and offer wireless services and lunch for
afternoon customers. These are worthy strategies for reaching digital natives.
203. Organizations with positive images for performing exceptional service to customers are
usually friendly places to work, as well.
204. Organizational culture can produce either a positive or negative impact on an
organization.
205. The very best organizations have cultures that emphasize service to others, especially
customers.
206. Organizational culture refers to the widely shared values within a corporation that foster
unity and cooperation.
207. The
informal organization
is created by the decisions of top management.
208. While most organizations have a formal organization structure, only poorly managed firms
also have an informal organization.
209. A firm's informal organization refers to the structure that identifies the authority,
responsibility, and position of people within the organization.
210. The informal organization of a business can help generate creative solutions and inspire
teamwork and camaraderie.
211. The formal organization of a firm provides the lines of authority to follow in routine
situations.
