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Exam 8: Adapting Organizations to Todays Markets

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Question 141

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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 social networks such as Twitter and Facebook,and offer wireless services and lunch for afternoon customers.These are worthy strategies for reaching digital natives. Introducing change is difficult for any manager.In order to attract digital natives, (younger generations who grew-up with the Internet)businesses are trying to reach them by frequenting places that they frequent such as social network sites.

A) True
B) False

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Question 142

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A chain of command is a line of authority that moves from the lowest level of the hierarchy to the top.

A) True
B) False

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Question 143

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The informal organization of a business can help generate creative solutions and inspires teamwork and camaraderie.

A firm's formal organization would be better suited than its informal organization to:

Job descriptions are an important part of Max Weber's organizational theory.

When Eric Schmidt joined Google™,one of the most successful companies of this decade,he tackled the organization function head-on.In speaking at a large conference with Google founders,Sergey Brinn and Larry Page,he commented that Google was running pretty well,"it just needed a little structure." Schmidt was referring to basic organization principles such as division of labor,specialization,and getting the departments up and running. Basic organization principles include division of labor,specialization of tasks,and departmentalization.

Mini-Case Angelica Canizales is the CEO of Mucho Dinero Enterprises.Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years.Employees appear demoralized 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 between 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 that,"We have so many layers of management that it takes forever to make decisions." An employee from marketing complained that,"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 expressed "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 employees,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. -Currently,Mucho Dinero is organized into specialized departments such as marketing,finance,production and personnel.These departments are designed to allow people with similar skills and expertise to work together.This approach is known as ___________ departmentalization.

Managing a growing business often requires managers to create departments to accomplish various tasks.

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

When management structures the organization,it clarifies who gets to make decisions,how many people report to one manager,and how many different departments the company needs in order to operate effectively. Structuring the organization involves deciding on a centralization vs.decentralization decision-making policy;decisions with regards to span of control,meaning how many employees will report to one manager,as well as how to departmentalize.

A hierarchy requires many top managers,but only a few middle managers.

The ________ an organization's structure,the ________ the span of control.

In a line-and-staff organization,staff positions are temporary jobs to train new line managers.

The virtual corporation does all its business online with partners considered a permanent part of the network. Although it is possible for firms that are connected virtually to interact online,the term refers to the fact that the functional units of this type of corporation do not have permanent ties to any one corporation.The core firms hire other companies to partner with it on an as needed basis.

Dividing the required work among a group of employees is called:

Mini-Case Angelica Canizales is the CEO of Mucho Dinero Enterprises.Sales have declined for four consecutive years and the firm's accountants have reported net losses in each of the last two years.Employees appear demoralized 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 between 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 that,"We have so many layers of management that it takes forever to make decisions." An employee from marketing complained that,"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 expressed "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 employees,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. -Employee complaints that there are too many layers of management and too many rules and regulations suggest that Mucho Dinero is a(n) :

Organizational culture refers to the widely shared values within a corporation that foster unity and cooperation.

Weber promoted the idea of the pyramid-shaped organization structure for large businesses.

Cross-functional self-managed teams are groups of employees empowered to work with suppliers and customers to develop new products and give great service.

Staff positions in an organization: