Management Chapter 7 Homework Students Who Seek More Formal Authority Should

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a. Grouping employees permits efficient resource use and economies of scale.

b. Departments enhance in-depth skill specialization and development.

Exhibit 7.9: Structural Advantages and Disadvantages

2. Divisional Approach

a. The organization is flexible and responsive to change because each unit is small.

3. Matrix Approach

a. The matrix approach has flexibility and adaptability.

4. Team Approach

a. The team concept breaks down barriers across departments and improves

5. Virtual Network Approach

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a. Flexibility and competitiveness allows a firm to draw on resources and expertise

worldwide.

Discussion Question #7: The Hay Group published a report that some managers have

personalities suited to horizontal relationships such as project management that achieve results

with little formal authority. Other managers are more suited to operating roles with much

formal authority in a vertical structure. In what type of structure—functional, matrix, team, or

virtual network—do you believe your personality would fit best? Which structure would be the

most challenging for you? Give your reasons.

III. ORGANIZING FOR HORIZONTAL COORDINATION

INSTRUCTOR’S NOTES_________________________________________________________

______________________________________________________________________________

A. The Need for Coordination

2. Coordination refers to the quality of collaboration across departments. It is required

whether there is a functional, divisional, or team structure.

3. Coordination problems are greater in the global arena because units differ by

4. Coordination results from information and cooperation. Managers can design

structures to promote horizontal coordination.

Exhibit 7.10: Evolution of Organization Structures

B. Task Forces, Teams, and Project Management

2. Task force members represent their departments and share information that enables

coordination. Companies also set up cross-functional teams for coordination.

4. A project manager is not a member of one of the departments being coordinated.

5. Project managers need excellent people skills. They use expertise and persuasion to

achieve coordination among various departments.

New Manager Self-Test: Authority Role Models

An organization’s structure is based on authority. Expectations about authority for a new

manager are often based on experiences in your first authority figures and role models—Mom

and Dad. This exercise helps students understand their authority role models. Authoritarian

Exhibit 7.11: Example of Project Manager Relationships to Other Departments

IV. FACTORS SHAPING STRUCTURE

INSTRUCTOR’S NOTES_________________________________________________________

______________________________________________________________________________

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______________________________________________________________________________

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Vertical hierarchies continue to thrive because they often provide important benefits for

Exhibit 7.12: Factors Affecting Organization Structure

A. Structure Follows Strategy

1. The terms mechanistic and organic can be used to explain structural responses to

strategy and the environment. Goals of efficiency and a stable environment are

Exhibit 7.13: Relationship of Structural Approach to Strategy and the Environment

B. Structure Fits the Technology

1. Woodward’s Manufacturing Technology

a. Small-batch and unit production. Small-batch production firms produce goods

b. Large-batch and mass production. Mass production technology is distinguished

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c. Continuous process production. In continuous process production, the entire

Exhibit 7.14: Relationship between Manufacturing Technology and Organization

Structure

2. Service Technology

a. Service organizations include consulting companies, law firms, brokerage houses,

airlines, hotels, advertising companies, amusement parks, and educational

organizations. Service technology also characterizes departments such as legal,

human resources, finance, and market research in large corporations. Service

technology involves:

3. Digital Technology

a. Digital technology is characterized by use of the Internet and other digital

processes to conduct or support business online. Like service firms, organizations

Answers to Discussion Questions

1. Sandra Holt, manager of Electronics Assembly, asked Hector Cruz, her senior technician, to

handle things in the department while Sandra worked on the budget. She needed peace and

quiet for at least a week to complete her figures. After ten days, Sandra discovered that

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Hector had hired a senior secretary, not realizing that Sandra had promised interviews to

two other people. Evaluate Sandra’s approach to delegation.

An evaluation of Sandra’s approach to delegation can be made by using the Manager’s Shoptalk

box entitled “How to Delegate.” The guidelines provided there include delegating the whole

2. Most organizations have been making greater use of teams in recent years. What factors

might account for this trend?

In general, the trend toward teams and task forces is probably associated with greater

environmental change, more sophisticated technologies, and corporate emphasis on

3. An organizational consultant was heard to say, “Some aspect of functional structure appears

in every organization.” Do you agree? Explain.

4. The divisional structure is often considered almost the opposite of a functional structure. Do

you agree? Briefly explain the major differences in these two approaches to

departmentalization.

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The focus of a functional structure is on similarity of skills, expertise, work activities, and

resource use. Human resources are grouped together in large functional departments to achieve

5. Some people argue that the matrix structure should be adopted only as a last resort because

the dual chains of command can create more problems than they solve. Discuss. Do you

agree or disagree? Why?

Many experts would agree that the matrix structure should be adopted only after other structures

have been tried. If the organization is in a functional structure and that doesn’t work, and then

reorganizes into a divisional structure and that doesn’t work either, a matrix structure may be

6. What is the virtual network approach to structure? Is the use of authority and responsibility

different compared with other forms of departmentalization? Explain.

In the virtual network approach, the organization becomes a small central broker, electronically

connected to other organizations that perform vital functions. Each department is an independent

7. The Hay Group published a report that some managers have personalities suited to

horizontal relationships such as project management that achieve results with little formal

authority. Other managers are more suited to operating roles with much formal authority in

a vertical structure. In what type of structure—functional, matrix, team, or virtual network—

do you believe your personality would best fit? Which structure would be the most

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challenging for you? Give your reasons.

Students’ responses will vary; however, they should demonstrate a clear understanding of the

8. Experts say that organizations are becoming increasingly decentralized, with authority,

decision-making responsibility, and accountability being pushed farther down into the

organization. How will this trend affect what will be asked of you as a new manager?

The trend toward increased decentralization, with authority, decision-making responsibility, and

9. The chapter suggested that structure should be designed to fit strategy. Some theorists argue

that strategy should be designed to fit the organization’s structure. With which theory do you

agree? Explain

If the company is an already existing company, the argument for adapting strategy to structure is

10. Would you expect the structure of a company such as Facebook that operates almost entirely

online to differ from the structure of a bricks-and-mortar company such as AT&T that uses

the Internet for some things, such as customer service and business-to-business transactions?

Why or why not?

Both companies are service organizations, but because AT&T provides Internet, television, and

telephone services to its customers, all of which require installation and/or repair work, it must

TEACHING NOTES FOR LEARNING EXERCISES

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Self Learning: Organic Versus Mechanistic Organization Structure

Students interview employees at their universities, such as department heads or secretaries by

having them answer 13 questions provided in the exercise. Students then answer the same

Group Learning: Family Business

In this exercise, students assume the role of consultant to a family business and rank the priority

of departmental functions in order of importance for assigning additional resources to improve

Action Learning: Team Skills

Students are asked to think of three times they have been members of work teams, with varying

TEACHING NOTE FOR ETHICAL DILEMMA

A Matter of Delegation

1. Prepare a memo to Golopolus, summarizing the new safety guidelines that affect the

Rockingham product line and requesting his authorization for implementation.

2. Mind your own business. Golopolus hasn’t said anything about the new guidelines and you

don’t want to overstep your authority. You’ve been unemployed and need this job.

3. Send copies of the reports anonymously to the operations manager, who is Golopolus’s boss.

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The operations manager is ultimately responsible for whether Rockingham’s toys meet federal

CASE FOR CRITICAL ANALYSIS

FMB&T

1. What are the main organizational causes of the frustration that Ayishia Coles feels?

FMB&T recently elevated the senior IT position to the level of executive vice president and

2. If you were Marshall Pinkard, how would you address both Ayishia’s request for

clarification about her authority and responsibilities and the underlying problems her e-mail

brings to his attention? Can the problems be addressed with minor adjustments, or would

you need to consider a drastic overhaul of the bank’s organizational structure? What

environmental and technological factors would influence your decision?

Marshall Pinkard needs to gather his top management team and make it very clear to them that

the IT function is critical to the success of the company, and spell out exactly what Ayishia

Cole’s authority has and to emphasize the need for coordination among departments and

3. Sketch a general chart for the type of organization that you think would work best for IT at

FMB&T.

A modified matrix structure might work well for FMB&T, in which the current vertical structure

ON THE JOB VIDEO CASE

Modern Shed: Designing Adaptive Organizations

1. Which of the five approaches to structural design is used at Modern Shed, and how are the

company’s departments organized and coordinated?

Modern Shed uses the virtual network approach to departmentalization. The Seattle shed builder

has a core hub of just 12 to 14 employees (mostly designers and managers). These top managers

2. What are the advantages and disadvantages of Modern Shed’s organizational structure?

The advantages of operating as a virtual network include fast response to market needs; access to

3. How did Ryan Smith determine whether his company needed a mechanistic structure with a

formal vertical hierarchy or an organic one involving free-flowing partnerships?

A firm’s organizational structure is determined largely by the company’s business strategy.

Modern Shed designs innovative and customizable studio dwellings for a rapidly changing niche

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BIZFLIX VIDEO CASE

Rendition

Video Case Synopsis

U. S. government operatives suddenly whisk Anwar El-Ibrahimi (Omar Metwally) from his

flight from Cape Town, South Africa after it arrives in Washington, D.C. He is a suspected

terrorist whom the government sends to North Africa for torture and interrogation (extraordinary

rendition). Douglas Freeman (Jake Gyllenhaal), a CIA analyst, becomes involved. He reacts

negatively to the torture techniques and urges El-Ibrahimi’s release. The story has other

complications in the form of El-Ibrahimi’s pregnant wife at home who desperately works for her

husband’s safe return.

Video Case Discussion Questions and Suggested Answers

1. What formal tasks does this scene imply? What reporting relationships does it show?

Alan Smith has given himself the task of asking Corrine Whitman some questions. He is

2. Can you sense the division of labor represented by Senator Hawkins and Alan Smith?

Corrine Whitman does not appear in this scene but is also part of a division of labor.

3. Does the scene show line authority or staff authority? Does it imply a functional or divisional

structure? Give some examples from the scene.

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This scene shows a functional organizational structure with line authority between Senator