Question 1

In a divisional structure, the organization groups together activities related to:
A)hierarchy.
B)outputs.
C)skills.
D)tasks.
E)functions.

Accepted Answer

In a divisional structure, the organization groups together activities related to outputs, such as type of product or type (or location) of customer. The people in a division can become experts at making a particular type of product or serving the particular needs of their customer group or geographic area.

Question 2

An open system is:
A)a self-sufficient entity.
B)rarely capable of adaptation and growth.
C)seldom capable of self-correction.
D)dependent on the environment for survival.
E)characterized as a well-oiled machine.

Accepted Answer

Open systems depend on constant interaction with the environment for survival. They are capable of self-correction, adaptation, and growth, thanks to characteristics such as homeostasis and feedback control.

Question 3

Efron & Co. have been active in the cell phone manufacturing business for the last two years and have been the market leaders for the last one-and-a-half years. Recently, its research and development department has suggested adding a few games to the phone that they say will attract people in the age group of 15 to 25 years. However, Charlotte, the head of the marketing department, declined to make any changes to the existing product, stating that the product was already a huge success so there was no need to make any changes to it. Charlotte is displaying a(n):
A)anchoring bias.
B)bandwagon bias.
C)congruence bias.
D)decision-making bias.
E)endowment bias.

Accepted Answer

The decision-making bias leads to the inflated perception that management is better than it actually is, which in turn can cause managers to "dismiss new innovations, dips in customer satisfaction, and increases in quality problems, and to make overly risky moves."

Question 4

A functional structure groups together:
A)people who are experts at serving a particular need of the customers.
B)people who serve a particular geographic area.
C)people according to the specialized set of tasks they perform.
D)activities related to outputs.
E)people who are experts at making a particular type of product.

Accepted Answer

A functional structure groups people according to the business functions they perform, for example, manufacturing, marketing, and finance. A manager is responsible for the performance of each of these functions, and employees tend to identify strongly with their particular function, such as sales or engineering.

Question 5

An organization that proactively creates, acquires, and transfers knowledge and that changes its behavior on the basis of new knowledge and insights is known as a:
A)learning organization.
B)downsized system.
C)legacy organization.
D)closed system.
E)traditional organization.

Accepted Answer

A learning organization is a group of people working together to collectively enhance their capacities to create results that they truly care about. A learning organization is one that proactively creates, acquires, and transfers knowledge and that changes its behavior on the basis of new knowledge and insights.

Question 6

Barry is a manager in a cell phone manufacturing company. He assumed that the recent growth of profit was due to his excellent planning, without considering the fact there was marked reduction in the inflation rate. This is an example of a:
A)reverse halo effect.
B)self-serving bias.
C)contrast bias.
D)generalization effect.
E)halo effect.

Accepted Answer

The self-serving bias reflects the tendency to take more personal responsibility for success than failure and can lead managers to assume that success was due to their insights and talents and not to random events or external factors outside of management's control.

Question 7

Which of the following structures combines functional and divisional chains of command to form a grid with two command structures?
A)Hollow structure
B)Modular structure
C)Matrix structure
D)Project structure
E)Product structure

Accepted Answer

A matrix structure combines a vertical structure with an equally strong horizontal overlay. This generally combines functional and divisional chains of command to form a grid with two command structures, one shown vertically by function, and the other shown horizontally, by product line, brand, customer group, or geographic region.

Question 8

Which of the following is true of organizations designed horizontally?
A)The organization seldom allows its suppliers and customers to influence performance.
B)The people are organized into cross-functional teams.
C)The teams are organized around tasks rather than complete workflow processes.
D)The organization has a strict hierarchy.
E)The organization rarely provides any external expertise.

Accepted Answer

The horizontal approach to organizational design tends to focus on work processes. Completing a process requires input from people in different functions, typically organized into a cross-functional team.

Question 9

Johnson & Co. has divided its employees according to the locations of the customers that they tend to. Thus, it has teams that cater to the urban areas, semi-urban areas, etc. Johnson & Co. is said to have a _____ structure.
A)functional
B)hollow
C)modular
D)virtual
E)divisional

Accepted Answer

In a divisional structure, the organization groups together activities related to outputs, such as type of product or type (or location) of customer. The people in a division can become experts at making a particular type of product or serving the particular needs of their customer group or geographic area.

Question 10

_____ is defined as the structures of accountability and responsibility used to develop and implement strategies, and the human resource practices and information and business processes that activate those structures.
A)Organizational chart
B)Organizational culture
C)Organizational psychology
D)Organizational assimilation
E)Organizational design

Accepted Answer

Organizational design is defined as "the structures of accountability and responsibility used to develop and implement strategies, and the human resource practices and information and business processes that activate those structures." The general idea behind the study of organizational design is that organizations are more effective or successful when their structure supports the execution of corporate strategies.

Question 11

A(n) ______ actively attempts to infuse the organization with new ideas and information by scanning the external environment and hiring new talent.
A)learning organization
B)traditional organization
C)legacy organization
D)closed system
E)downsized system

Accepted Answer

Learning organizations actively try to infuse their organizations with new ideas and information. They do this by constantly scanning their external environments, hiring new talent and expertise when needed, and by devoting significant resources to train and develop their employees.

Question 12

A _____ is a group of people working together to collectively enhance their capacities to create results that they truly care about.
A)closed system
B)legacy organization
C)downsized system
D)traditional organization
E)learning organization

Accepted Answer

A learning organization is a group of people working together to collectively enhance their capacities to create results that they truly care about. A learning organization is one that proactively creates, acquires, and transfers knowledge and that changes its behavior on the basis of new knowledge and insights.

Question 13

A(n) _____ represents group members' shared, organized understanding and mental representation of knowledge about key elements of the group's relevant environment.
A)transactive memory system
B)team mental model
C)mental performance measurement
D)organizational design
E)systemic structure

Accepted Answer

The creation of a learning organization requires that organizational members use team mental models. A team mental model represents team members' "shared, organized understanding and mental representation of knowledge about key elements of the team's relevant environment."

Question 14

The _____ reflects the tendency to take more personal responsibility for success than failure.
A)self-serving bias
B)halo effect
C)reverse halo effect
D)contrast bias
E)generalization bias

Accepted Answer

The self-serving bias reflects the tendency to take more personal responsibility for success than failure and can lead managers to assume that success was due to their insights and talents and not to random events or external factors outside of management's control.

Question 15

Learning organizations strive to:
A)increase structural barriers.
B)increase process barriers.
C)increase interpersonal barriers.
D)decrease information sharing.
E)learn from successes and failures.

Accepted Answer

Learning organizations strive to reduce structural, process, and interpersonal barriers to the sharing of information, ideas, and knowledge among organizational members. They also focus on learning from both success and failure.

Question 16

Smith & Co. has divided its employees into various groups like manufacturing, marketing, and finance. Smith & Johnson is said to have a(n) _____ structure.
A)entrepreneurial
B)project
C)hollow
D)modular
E)functional

Accepted Answer

A functional structure groups people according to the business functions they perform, for example, manufacturing, marketing, and finance. A manager is responsible for the performance of each of these functions, and employees tend to identify strongly with their particular function, such as sales or engineering.

Question 17

Which of the following is a characteristic of the horizontal organization?
A)They emphasize on internal expertise rather than external expertise.
B)They give less importance to suppliers.
C)They place a greater emphasis on teamwork.
D)They emphasize tasks.
E)They strictly adhere to the chain of command.

Accepted Answer

The horizontal approach to organizational design tends to focus on work processes. Completing a process requires input from people in different functions, typically organized into a cross-functional team. Thus, teamwork is a feature of organizations designed horizontally.

Question 18

Employees in a matrix structure report to two managers: one in charge of the function they perform and the other in charge of the project they are working on. This is a violation of the principle of:
A)absorptive capacity.
B)cognitive complexity.
C)locus of control.
D)unity of command.
E)span of control.

Accepted Answer

Employees in a matrix structure report to two managers: one in charge of the function they perform and the other in charge of the project they are working on. This is a violation of the principle of unity of command. The unity of command principle specifies that each employee should report to only one manager.

Question 19

A(n) _____ structure combines a vertical structure with an equally strong horizontal overlay.
A)network
B)matrix
C)bureaucratic
D)entrepreneurial
E)central

Accepted Answer

A matrix structure combines a vertical structure with an equally strong horizontal overlay. This generally combines functional and divisional chains of command to form a grid with two command structures, one shown vertically by function, and the other shown horizontally, by product line, brand, customer group, or geographic region.

Question 20

Which of the following biases leads to the inflated perception that management is better than it actually is?
A)Congruence bias
B)Endowment bias
C)Decision-making bias
D)Anchoring bias
E)Bandwagon bias

Accepted Answer

The decision-making bias leads to the inflated perception that management is better than it actually is, which in turn can cause managers to "dismiss new innovations, dips in customer satisfaction, and increases in quality problems, and to make overly risky moves."

Quiz 17: Organizational Design, Effectiveness, and Innovation

In a divisional structure, the organization groups together activities related to:

An open system is:

A functional structure groups together:

An organization that proactively creates, acquires, and transfers knowledge and that changes its behavior on the basis of new knowledge and insights is known as a:

Barry is a manager in a cell phone manufacturing company. He assumed that the recent growth of profit was due to his excellent planning, without considering the fact there was marked reduction in the inflation rate. This is an example of a:

Which of the following structures combines functional and divisional chains of command to form a grid with two command structures?

Which of the following is true of organizations designed horizontally?

Johnson & Co. has divided its employees according to the locations of the customers that they tend to. Thus, it has teams that cater to the urban areas, semi-urban areas, etc. Johnson & Co. is said to have a _____ structure.

_____ is defined as the structures of accountability and responsibility used to develop and implement strategies, and the human resource practices and information and business processes that activate those structures.

A(n) ______ actively attempts to infuse the organization with new ideas and information by scanning the external environment and hiring new talent.

A _____ is a group of people working together to collectively enhance their capacities to create results that they truly care about.

A(n) _____ represents group members' shared, organized understanding and mental representation of knowledge about key elements of the group's relevant environment.

The _____ reflects the tendency to take more personal responsibility for success than failure.

Learning organizations strive to:

Smith & Co. has divided its employees into various groups like manufacturing, marketing, and finance. Smith & Johnson is said to have a(n) _____ structure.

Which of the following is a characteristic of the horizontal organization?

Employees in a matrix structure report to two managers: one in charge of the function they perform and the other in charge of the project they are working on. This is a violation of the principle of:

A(n) _____ structure combines a vertical structure with an equally strong horizontal overlay.

Which of the following biases leads to the inflated perception that management is better than it actually is?