Deck 13: Designing Organizational Structures

Question 1

The number of layers in an organization's hierarchy depends on the number of people employed and the average span of control.

Answer 1

True
Explanation: The interconnection of span of control, organizational size (number of employees), and number of management layers has important implications for companies.As organizations employ more people, they must widen the span of control; build a taller hierarchy, or both.

Question 2

Job descriptions help improve quality and consistency of a product or service by standardizing work activities.

Answer 2

True
Explanation: Standardization involves creating routine patterns of behavior or output.Quality and consistency of a product or service can often be improved by standardizing work activities through job descriptions and procedures.

Question 3

The span of control is interconnected with organizational size and the number of layers in the hierarchy.

Answer 3

True
Explanation: Span of control is interconnected with organizational size (number of employees) and the number of layers in the organizational hierarchy.The reason for this relationship is that a company with a wider span of control necessarily has more employees per supervisor, more supervisors for each middle manager, and so on.

Question 4

When employees perform highly interdependent work, generally a narrow span of control is necessary.

Question 5

Standardizing processes is less effective for nonroutine and complex work than for routine or simple work.

Question 6

Most organizations begin with centralized structures and become more decentralized as they grow larger and divide work into more specialized functions.

Question 7

Companies can be centralized in some parts of the organization and decentralized in other parts.

Question 8

Division of labor leads to increased job specialization.

Question 9

The two fundamental requirements of all organizational structures are divisionalization and decentralization.

Question 10

Temporary cross-functional teams can be used to encourage informal communication as a coordinating mechanism.

Question 11

Tall hierarchies encourage employee empowerment and engagement because they focus power around employees rather than managers.

Question 12

When work is divided among people, a coordinating mechanism is needed to ensure that everyone works in concert.

Question 13

Informal communication is a coordination mechanism only in small and a few medium-sized organizations.

Question 14

When work activities are too complex to standardize through extensive training for employees, companies need to coordinate work effort through precise job descriptions.

Question 15

Large organizations can encourage informal communication as a coordinating mechanism by keeping each production site small.

Question 16

Organizations tend to become less formalized as they age and grow larger in terms of the number of employees.

Question 17

When employees work in non-routine and ambiguous situations, formal hierarchy is the least time-consuming coordinating mechanism.

Question 18

When a manager has many direct reports, a narrow span of control exists.

Question 19

An organization's structure is the same as its organizational chart.

Question 20

Integrator roles increase informal communication as a coordinating mechanism.

Question 21

Organizations move toward a team-based structure by flattening the hierarchy, reducing formalization, and making extensive use of self-directed work teams.

Question 22

A simple structure is one of the best structures in which to accommodate organizational growth and diversification.

Question 23

Mechanistic structures operate better in stable environments than in rapidly changing environments.

Question 24

The geographic-product matrix structure is likely the most common matrix design among global companies.

Question 25

A mechanistic structure is decentralized, has a wide span of control and little formalization.

Question 26

As external environments become more complex and dynamic, organizational structures should become more mechanistic and less organic.

Question 27

The conflict and ambiguity associated with the matrix structure causes some employees to experience more stress.

Question 28

Functional structures tend to have higher dysfunctional conflict and poorer coordination across units than other forms of departmentalization.

Question 29

Functional structures foster professional identity and permit greater specialization than most other forms of departmentalization.

Question 30

Companies with divisionalized structures are increasingly adopting the geographically-based structure.

Question 31

A problem with the team-based organizational structure is that employees may experience more stress due to ambiguity of their roles.

Question 32

A problem with the divisional structure is that it increases the risk of duplication and underutilization of resources.

Question 33

Formalization represents the establishment of standardization as a coordinating mechanism.

Question 34

Divisional structures may be formed around products, geography, or clients.

Question 35

A problem with departmentalization is that it discourages coordination through informal communication.

Question 36

Departmentalization establishes interdependencies among employees and subunits and frames the membership of formal work teams.

Question 37

The primary source of environmental diversity or uncertainty mainly determines the best form of divisional structure an organization should adopt.

Question 38

One advantage of a matrix structure is clarity of accountability.

Question 39

All employees working in a matrix organization have two bosses.

Question 40

Team-based organizational structures are usually found within larger divisionalized structures.

Question 41

One of the main advantages of network structures is that they ensure the core organization has a high degree of control over production, marketing and other functions.

Question 42

Organizational strategy influences both the contingencies of structure and the structure itself.

Question 43

The more integrated its environment, the more an organization would benefit from a divisionalized form of departmentalization.

Question 44

Contingencies such as size, technology, and environment do not necessarily determine an organization's structure.

Question 45

In a typical matrix structure, several satellite organizations are bee-hived around a core firm.

Question 46

If a company chooses a low-cost strategy, an organic structure is preferred because it maximizes production and service efficiency.

Question 47

Coordination of work activities is:

A)required whenever there is division of labor.
B)required only in team-based organizations.
C)required whenever the organization has more than approximately 100 employees.
D)required only when organizations operate in complex environments.
E)discouraged in organizations as it leads to a high degree of interdependence among employees.

Question 48

Decentralization is the preferred strategy for organizations in simple, integrated (one market), and hostile environments.

Question 49

When tasks have high variability and low analyzability, a mechanistic structure works better than an organic structure.

Question 50

Larger firms tend to be more centralized and make greater use of direct supervision than do smaller firms.

Question 51

Which of the following fundamental requirements do all organizational structures have?

A)Flatter span of control and decentralization
B)Division of labor and coordination
C)Decentralization and divisionalization
D)Coordination and decentralization
E)Centralization and outsourcing

Question 52

Network structures come close to the perfect example of a mechanistic organizational structure.

Question 53

"Structure follows strategy" means that organizational designers should base their choice of structure on the implications of their strategic decisions.

Question 54

In organizational structures, integrator roles serve mainly as:

A)a form of standardization.
B)an informal communication coordinating mechanism.
C)a form of direct supervision.
D)technological contingency.
E)main element in divisionalized structures.

Question 55

Dividing work into more specialized jobs:

A)increases training costs.
B)reduces work efficiency.
C)reduces the opportunity to match people with appropriate jobs.
D)increases the time taken in changing from one task to another.
E)gives an opportunity to the job incumbents to master their tasks quickly.

Question 56

A potential disadvantage of network structures is that they expose the core firm to market forces.

Question 57

One of the main forces pushing organizations toward a matrix structure is the recognition that an organization has only a few core competencies.

Question 58

If a company's strategy is to compete through innovation, a more organic structure is preferred.

Question 59

Mechanistic structures are better suited to dynamic environments than to stable environments.

Question 60

To increase work efficiency and make it easier to match employee competencies with job requirements, companies:

A)divide work into more specialized jobs.
B)rely on formal hierarchy as a coordinating mechanism.
C)rely on a narrow span of control.
D)centralize decision making.
E)rely on formal hierarchy and a narrow span of control.

Question 61

Standardizing work through job descriptions and procedures:

A)is a form of coordination.
B)is more common when the work is complex and ambiguous.
C)tends to reduce quality and consistency.
D)is unnecessary in large organizations.
E)is more common in organic rather than mechanistic structures.

Question 62

Which of the following forms of departmentalization organizes employees around specific skills or other resources?

A)Divisional structure
B)Functional structure
C)Simple structure
D)Matrix structure
E)Network structure

Question 63

A wider span of control is possible if:

A)employees manage themselves rather than being coordinated through close supervision.
B)the company has a high degree of formalization and operates in a complex environment.
C)the organization has few employees and a tall hierarchy.
D)the company does not rely on self-directed teams.
E)very few people report directly to a manager.

Question 64

Candoo Ltd.will soon flatten its hierarchy by removing two of the five layers of management.If the number of employees in the organization remains constant, which of the following must also occur?

A)It must adopt a matrix form of departmentalization.
B)It must widen the span of control.
C)It must rely more on direct supervision than on standardization to coordinate the resulting structure.
D)It must centralize decision making.
E)It must discourage employee empowerment.

Question 65

Formalization in organizational structures tends to:

A)reduce organizational flexibility.
B)encourage organizational learning and creativity.
C)disperse decision authority and power throughout the organization.
D)increase organizational learning.
E)decrease efficiency and compliance.

Question 66

The simple structure usually depends on _____ to coordinate work activities, so it is very difficult to operate as the company grows and becomes more complex.

A)the owner's direct supervision
B)standardization through formal instructions
C)formal training (standardizing skills)
D)standardization of product or service outputs
E)decentralization

Question 67

_____ establishes the chain of command - the system of common supervision among positions and units within the organization.

A)Span of control
B)Formalization
C)Centralization
D)Job rotation
E)Departmentalization

Question 68

Organizational and environmental complexities push organizations toward:

A)formalization.
B)a more mechanistic structure.
C)decentralization.
D)a simple structure.
E)a narrow span of control.

Question 69

Mechanistic structures operate best:

A)in stable environments.
B)where employees dislike hierarchy and status.
C)when there are horizontal rather than vertical communication flows.
D)where knowledge management is a competitive advantage to the organization.
E)where employees perform tasks with high variability and low analyzability.

Question 70

Which of the following is typically most important among people working in hospital surgical operations?

A)Organizational goals
B)Integrator roles
C)Job descriptions
D)Extensive training
E)Company rules

Question 71

An organic structure has:

A)a narrow span of control.
B)centralized decision making.
C)little formalization.
D)vertical communication flows.
E)rigidly defined tasks.

Question 72

As organizations grow older, they tend to:

A)become more formalized.
B)have a more centralized structure.
C)move toward a simple form of departmentalization.
D)shift from a mechanistic to an organic structure.
E)operate with a wide span of control and less standardization.

Question 73

One of the defining characteristics of a functional organizational structure is that it:

A)has a narrow span of control and high degree of formalization and centralization.
B)is the structure that organizes employees around specific knowledge or other resources.
C)overlays two organizational structures in order to leverage the benefits of both types of structure.
D)uses self-directed work teams rather than individuals as the basic building block of organizations.
E)is an alliance of several organizations for the purpose of creating a product or serving a client.

Question 74

Flatter organizational structures:

A)tend to reduce overhead costs.
B)receive lower quality information from the external environment.
C)undermine employee empowerment and engagement.
D)receive less timely information from the external environment.
E)narrow the span of control for supervisors.

Question 75

Coordination through formal hierarchy relies on:

A)informal communication.
B)job descriptions.
C)goals and objectives.
D)direct supervision.
E)specialized skills of the employees.

Question 76

Which of the following organizational design elements determines the sharing of resources and encourages coordination through informal communication?

A)Span of control
B)Formalization
C)Centralization
D)Departmentalization
E)Standardization

Question 77

Many of the best-performing production plants are able to widen their span of control to more than 70 employees per supervisor by:

A)teaching supervisors how to more efficiently monitor employees.
B)giving up on the idea that all employees must perform their fair share of work.
C)hiring supervisors who intimidate employees more often.
D)relying on self-directed work teams and other coordinating mechanisms.
E)introducing video cameras and other technologies to help supervisors to monitor more employees.

Question 78

Span of control, centralization, and formalization together form a cluster around two broader organizational forms called:

A)hierarchical and delayered structures.
B)networked and team-based structures.
C)geographic and product/client divisions.
D)organic and mechanistic structures.
E)diverse and integrated structures.

Question 79

_____ is the degree to which organizations standardize behavior through rules, procedures, formal training, and related mechanisms.

A)Departmentalization
B)Span of control
C)Formalization
D)Centralization
E)Division of labor

Question 80

When work activities are too complex to standardize through procedures or goals, companies often coordinate work effort:

A)through direct supervision.
B)by extensively training employees.
C)by giving one employee most of the tasks previously divided among many people.
D)through further division of labor.
E)through formal hierarchy.