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Exam 8: Structuring Organizations for Todays Challenges

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Question 81

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A firm's informal organization refers to the structure that identifies the authority, responsibility, and position of people within the organization.

A) True
B) False

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Question 82

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If companies follow the theories of Fayol and Weber, which of the following scenarios is likely to result?

A) Organization design will benefit by the emergence of quick decision making.
B) Organization design will eliminate systems of hierarchy and chains of command due to their hindrance of esprit de corps.
C) Organizations that grow will develop several layers of management and the time that it takes to make and carry out a decision will increase.
D) There will be a significant reduction of workforce due to specialization and departmentalization.

E) None of the above
F) A) and B)

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Question 83

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The formal organization of a firm provides the lines of authority to follow in routine situations.

Looking at a traditional organization chart, you will view who reports to whom; you will have a sense of each person's authority and responsibility, and the type of work that they perform for the organization.

An organization's core competencies are those functions that the firm performs as well as or better than anyone else in the world.

An advantage of departmentalization is groupthink.

________ believed that managers were trustworthy and companies would do well if employees simply did what they were told.

Departmentalization is the dividing of organizational functions into separate units.

Mini-Case Angelica Canizales is the CEO of Mucho Dinero Enterprises. Sales have dropped for four consecutive years and accountants have reported net losses in each of the last two years. Employees appear discouraged and frustrated. Recently, Angelica met with managers from marketing, production, and finance to listen to their views regarding the company's problems. The managers unanimously agreed that the main problem was a lack of communication among the several functional areas of the business. Each manager felt that the firm could increase quality and customer satisfaction with better interdepartmental communication. Angelica also met with marketing and production employees to get their respective opinions on the problems of the firm. One employee from the production department observed, "We have so many layers of management that it takes forever to make decisions." An employee from marketing complained, "This place is so bogged down with rules and regulations that there is no opportunity to be creative." Several employees shared their opinions regarding their bosses. Specifically, one employee said, "My boss never pays attention to my ideas. He just issues orders and expects me to obey them." Angelica decided, after listening to many comments from managers and employees and also suppliers and customers, that the only way to end Mucho Dinero's slide was to completely rethink the firm's structure and to make radical changes in its organization. She presented her ideas to the board of directors, promising to voluntarily resign if her efforts to reorganize did not return the firm to profitability. -From her discussions with employees, Angelica learned quickly that production workers put their trust in 20-year veteran Willie McClaren. Many people told her that if you wanted something done, Willie was the person to see. Willie appears to be an important part of the

An organization chart shows who is accountable for the completion of specific work and who reports to whom.

Weber had a great deal of faith in managers. He was confident that a firm would do well if employees simply did as they were told.

As a manager of a small clothing store, Archer favors detailed job descriptions, formal rules and regulations, thorough records, and standardized procedures. He also believes that staffing and promotion decisions should be based strictly on the qualifications of the people under consideration. Archer's attitudes suggest that he is strongly influenced by the ideas of

Mountain Top Community College is a multi-district college in the Denver area with four campuses. Each campus has one president, two vice presidents, five deans, 12 department chairs, over 100 faculty members, and several persons in support roles. The presidents from each campus report to four vice chancellors and the vice chancellors report to the chancellor. It is clear that Mountain Top has a well-defined ________.

Inverted organizations define the role of front-line employees as those workers who follow the orders of top and middle management.

Line-and-staff organizations work well in organizations with

Matrix organizational structures were first developed in

________ refers to companies headquartered abroad who elect to bring production and manufacturing to domestic subsidiaries.

Which term describes a company being so open to other companies working with it that electronic information is shared as if the companies were one?

Fayol's principle of the division of labor says that functions should be divided into areas of specialization such as production, marketing, and finance.

________ refer to those functions that an organization does as well as, or better than, any other organization in the world.