Question 1

An advantage of decentralization is that it reduces conflict with ongoing operations.

Accepted Answer

False

Question 2

A disadvantage of decentralization is that it leads to avoidance of radical innovation.

Accepted Answer

Decentralization can lead to avoidance of radical innovation because it can create silos and barriers to communication and collaboration, making it more difficult for new ideas to be shared and implemented.

Question 3

Organic structures are loosely controlled with hierarchical communication patterns and specialized jobs.

Accepted Answer

Organic structures are characterized by flexible communication patterns, less specialization, and a more adaptable approach to roles and responsibilities.

Question 4

Mechanistic structures permit greater organizational flexibility and adaptability than mechanistic ones.

Accepted Answer

Mechanistic structures are rigid and hierarchical, which limits flexibility and adaptability compared to organic structures.

Question 5

Successful high-technology firms typically build in slack resources to encourage innovation.

Accepted Answer

Slack resources provide employees with the time and resources needed to experiment and innovate without the pressure of immediate performance demands.

Question 6

Efforts to make organizations more efficient usually involve the elimination of slack resources because they are viewed as a drag on efficiency.

Accepted Answer

Slack resources are often seen as unnecessary or excess, and eliminating them can streamline operations and reduce costs, thereby increasing efficiency.

Question 7

On average, small firms can hire a more talented and more diverse group of employees than large ones, which improves the quality of their human capital.

Accepted Answer

Large firms often have more resources and established recruitment processes to attract a diverse and talented workforce compared to small firms.

Question 8

Small firms tend to be more innovative than large firms in industries that are younger, less R&D intensive, less concentrated, less capital intensive, less advertising intensive, and more reliant on skilled labor.

Accepted Answer

Small firms often have more flexibility and adaptability in younger, less established industries, allowing them to innovate more effectively in environments that require skilled labor but less capital and advertising investment.

Question 9

Research has shown that more than 80 percent of all firms are founded in the same industry as the one in which their founders were previously employed.

Accepted Answer

Research indicates that a significant majority of entrepreneurs start businesses in industries where they have prior work experience, leveraging their existing knowledge and networks.

Question 10

The disagreement with employees about how to divide the profit from innovation between them is the most basic explanation for why people create spin-off companies.

Accepted Answer

The answer of The disagreement with employees about how to...

Question 11

External equity investment in technology start-ups typically comes from venture capitalist.

Accepted Answer

The answer of External equity investment in technology start-ups typically...

Question 12

Business angels are private individuals who invest their own money in new companies.

Accepted Answer

Business angels are indeed private individuals who provide capital for startups, usually in exchange for ownership equity or convertible debt.

Question 13

New venture groups are entities that invest a business's money in start-up companies in return for an equity interest in them.

Accepted Answer

The answer of New venture groups are entities that invest...

Question 14

Corporate venture capital funds use a venture capital approach to corporate venturing, frequently coinvesting with other financial institutions.

Accepted Answer

Corporate venture capital funds often adopt a venture capital approach, which includes coinvesting with other financial institutions to diversify risk and leverage additional expertise and resources.

Question 15

Although the number of corporate venture groups peaked around 2003, it is still higher than it was in 1999.

Accepted Answer

The answer of Although the number of corporate venture groups...

Question 16

When companies engage in corporate venturing, they usually need to take the strategy of a parent firm into consideration and can't maximize financial returns, like independent venture capitalist.

Accepted Answer

Corporate venturing involves aligning with the strategic goals of the parent company, which may prioritize strategic benefits over purely financial returns, unlike independent venture capitalists who focus solely on financial gains.

Question 17

An advantage of corporate venturing is that it reduces risks on companies.

Accepted Answer

Corporate venturing can involve significant risks as it requires investment in new and unproven ventures, which may not always succeed.

Question 18

A disadvantage of corporate venturing is that it can interfere with ongoing operations.

Accepted Answer

Corporate venturing can divert resources and attention from core business activities, potentially disrupting ongoing operations.

Question 19

If the corporate ventures are strategically important and operationally related to your core capabilities, then the new ventures should be part of your core business.

Accepted Answer

If the ventures align with strategic importance and operational capabilities, integrating them into the core business can enhance synergy and leverage existing strengths.

Question 20

If the corporate ventures are strategically important and operationally unrelated to your core capabilities, then the new ventures should be direct spin-offs.

Accepted Answer

The answer of If the corporate ventures are strategically important...

Quiz 16: Organization Structure for Technology Strategy