Chapter 14 – Designing Market-Driven Organizations
Chapter 14
Designing Market-Driven Organizations
1. Traditional companies decentralize decision making when they run into hard times like
economic downturns.
2. In traditional organizational structures, units were either within the organization and closely
connected to other units, or they were outside the organization and not connected at all.
3. Knowledge workers may operate more effectively as conventional employees rather than
“internal partners.”
4. The management of knowledge workers puts less emphasis on innovation and creativity.
5. “Talent marketplaces” inside the organization allow capable employees to plot their own
career paths internally.
6. A key characteristic of new organizations is an emphasis on managing organizational
process, rather than a primary emphasis on structure.
7. In the past, organizations were designed for agility and responsiveness rather than stability.
8. A key advantage of functional organizational design is its customer focus.
Chapter 14 – Designing Market-Driven Organizations
9. A new-product team is different from a venture team in a new-product team is comprised of
functional specialists working on a specific new-product development project.
10. The market-focused organizational design is often used when a single product or a closely
related line is marketed to one market target.
11. Which of the following is true of conventional approaches to organizing?
A. Ideas and commands flow vertically between center and business units
B. Information and flow of knowledge between units are unrestricted
C. Decision making is decentralized
D. Organizational hierarchy is not visible
12. Which of the following does the management of knowledge workers emphasize on?
A. Formal structures
B. Talent management
C. Reporting lines
D. Conventional culture
13. Which of the following does the management of knowledge workers emphasize less on?
A. Talent management
B. Team leadership
C. Formal structure
D. Culture of innovation
14. _____ are influential individuals who move across network clusters and carry ideas from
one corporate silo to another and thereby generate new ideas.
A. Knowledge mules
B. Networked workers
C. Formal reporters
Chapter 14 – Designing Market-Driven Organizations
D. Silo scribes
15. Which of the following processes’ function is to define value for the organization?
A. New product development
B. Knowledge management
C. Logistics
D. Customer service
16. Which of the following processes’ function is to create value for the organization?
A. New product development
B. Logistics
C. Customer service
D. CRM
17. Which of the following processes’ function is to deliver value for the organization?
A. CRM
B. New product development
C. Knowledge management
D. Customer service
18. Which of the following is the first stage in aligning the organization with the market?
A. Aligning customer-based units with customers
B. Using integrating mechanisms such as segment managers
C. Improving alignment through informal lateral integration
D. Integrating functions like global account coordinators and market segment specialists
19. Which of the following is the final stage of organizational evolution?
A. The functional or product organization is retained.
B. Sales or product management takes informal steps to cross silos and solve customer
problems.
C. Organizations use integrating mechanisms such as key account or segment managers.
Chapter 14 – Designing Market-Driven Organizations
D. Comprehensive approaches are adopted to get full structural alignment with the market.
20. The _____ of marketing activities across multiple functions is more common in market–
oriented businesses serving business customers, and operating in uncertain markets with
uncertain technologies.
A. centralization
B. integration
C. diffusion
D. collection
21. Which of the following marketing organizational forms is highly effective for tasks
requiring little specialized investment, are nonroutine, and difficult to assess?
A. Bureaucratic form
B. Transactional form
C. Organic form
D. Relational form
22. Which of the following is an appropriate usage context for a transactional marketing
organizational form?
A. Tasks that are repetitive, easily assessed, with no specialized investment required
B. Tasks that are repetitive, easily assessed, and requiring specialized investment
C. Tasks that are infrequent, difficult to assess, requiring highly specialized investment
D. Tasks that are nonroutine, difficult to assess, requiring little specialized investment
23. Which of the following is an appropriate usage context for an organic marketing
organizational form?
A. Under competitive market conditions, low environmental uncertainty
B. Conditions of market failure, high environmental uncertainty, infrequent tasks
C. High environmental activity, under competitive market conditions, frequent tasks
D. Conditions of market failure, low environmental uncertainty, repetitive tasks
Chapter 14 – Designing Market-Driven Organizations
24. Which of the following are the performance characteristic of a bureaucratic marketing
organizational form?
A. Highly effective for appropriate tasks, less adaptive
B. Highly adaptive, less efficient
C. Highly effective and efficient, less adaptive
D. Highly effective for nonroutine, specialized tasks, less efficient
25. Which of the following marketing organizational forms have the following performance
characteristics: most efficient form; highly effective for appropriate tasks; less adaptive?
A. Bureaucratic form
B. Transactional form
C. Organic form
D. Relational form
26. Which of the following conditions suggests a market-oriented organizational design?
A. Substantial differences in the customer requirements in a given target market
B. Substantial similarities in the customer requirements in a given target market
C. Single market targets being served by dedicated strategic business units
D. Greater use of organizational designs that focus on products rather than customers
27. _____ organizational design assigns departments, groups, or individuals, responsibility for
specific activities, such as advertising and sales promotion, pricing, sales, marketing research,
and marketing planning and services.
A. Product-focused
B. Functional
C. Market-focused
D. Matrix
28._____ organizational design is used when a business unit serves more than one target and
customer considerations are an important factor in the design of the marketing organization.
A. Product-focused
B. Functional
C. Market-focused
Chapter 14 – Designing Market-Driven Organizations
D. Matrix
29. Which of the following organizational designs would utilize a cross-classification
approach that emphasizes two different factors, such as products and marketing functions?
A. Functional organizational design
B. Market-focused design
C. Product-focused design
D. Matrix design
30. Which of the following is a limitation of an internal marketing organization design?
A. Less control of activities
B. Limited familiarity with company operations
C. Lower commitment of employees to the organization
D. Lack of experience in other business environments
31. Explain the traditional organizational structure and its limitations.
Chapter 14 – Designing Market-Driven Organizations
32. Describe the dependence of innovation and growth on knowledge workers. What should
the management of these workers emphasize on?
33. Explain the importance of organizational agility and flexibility.
34. Give an account of the challenges in integrating marketing with other activities in a
company.
Chapter 14 – Designing Market-Driven Organizations
35. Explain the issue of integration vs. diffusion in the organizational design of marketing.