Question 1

A major disadvantage of adopting a divisional structure is the tendency for managers to focus on short-term objectives.

Accepted Answer

A) True 
 B)False

Question 2

Strategic business unit (SBU)  and holding company structures result from extensive

Accepted Answer

A)  diversification.
B)  vertical integration.
C)  international expansion.
D)  organizational flattening.E) A) and D)
F) B) and D)

Question 3

If an international firm has a multidomestic strategy and a relatively high level of product diversity, the best choice for its organizational structure is a(n)  ______________ structure.

Accepted Answer

A)  worldwide functional
B)  worldwide product division
C)  worldwide matrix
D)  international divisionE) A) and B)
F) All of the above

Question 4

One of the factors that explained the effectiveness of ambidextrous organizational designs in the O'Reilly and Tushman study was that the reward systems emphasized traditional unit goals.

Accepted Answer

A) True 
 B)False

Question 5

What is the name of the practice that many modular organization use to grow?

Accepted Answer

A)  operational effectiveness
B)  outsourcing
C)  strategic leveraging
D)  strategic enablingE) C) and D)
F) A) and B)

Question 6

Which of the following is an advantage of a divisional type of organizational structure?

Accepted Answer

A)  efficient use of managerial and technical talent
B)  an enhanced ability to respond quickly to changes in the external environment
C)  high degree of emphasis on long-term performance
D)  uniformity in image and quality across divisionsE) A) and B)
F) All of the above

Question 7

A major disadvantage of the functional organizational structure is that it often leads to silos in which departments view themselves as isolated, self-contained units with little need for interaction and coordination with other departments.

Accepted Answer

A) True 
 B)False

Question 8

Ambidextrous organizational designs are useful for firms that wish to create modest, incremental innovations at the same time as dramatic, breakthrough innovation. This is done by maintaining adaptability and alignment of values and coordination across organizational activities.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about simple organizational structures is false?

Accepted Answer

A)  Small firms with a narrow product-market scope will adopt such a structure.
B)  Decision making authority is highly centralized.
C)  There is little specialization of tasks.
D)  Creativity and individualism are rare.E) A) and B)
F) A) and D)

Question 10

When evaluating structure and organizational design, managers must consider the appropriateness of the type of organizational structure and they need to assess the mechanisms, processes, and techniques that will be most helpful in enforcing internal and external boundaries.

Accepted Answer

A) True 
 B)False

Question 11

According to author, Jeffrey Pfeffer, which of the following is not an advantage of teams?

Accepted Answer

A)  Teams interact so closely and therefore coordination and integration becomes unnecessary.
B)  Teams substitute peer-based control for hierarchical control of work.
C)  Teams often develop more creative solutions, because they share.
D)  Teams permit the absorption of administrative tasks previously performed by specialists.E) A) and D)
F) A) and B)

Question 12

One major advantage of the holding company form of organization structure is that it minimizes the duplication of functional activities between product lines.

Accepted Answer

A) True 
 B)False

Question 13

In large organizations, a strategy of diversification requires a need to reorganize around ______________ or _____________.

Accepted Answer

A)  product lines; geographic markets
B)  product lines; competition
C)  competitor lines; geographic markets
D)  distribution lines; competitor marketsE) A) and B)
F) C) and D)

Question 14

Organizations are increasingly using teams for many reasons. The difference between a good team and an outstanding team has been found to be

Accepted Answer

A)  the combined technical skills of the members.
B)  similarities in the way team members solve problems.
C)  the way team members treat each other.
D)  similarities in the age and experience of team member.E) All of the above
F) A) and D)

Question 15

Nike is a company that makes use of the concept of product expatriates. Product expatriates are

Accepted Answer

A)  managers from the home country sent abroad to oversee the marketing of company products.
B)  managers from suppliers who come to work at the company headquarters.
C)  managers of the company sent abroad to work at the plants of its suppliers.
D)  local nationals hired by the company in the countries from which it sources products.E) B) and D)
F) A) and C)

Question 16

Which of the following is not a disadvantage of a divisional type of organizational structure?

Accepted Answer

A)  It can be very expensive compared to a functional organizational structure.
B)  There is a strong tendency for divisions to focus on short-term performance.
C)  There can be dysfunctional competition among divisions.
D)  There is separation of strategic and operating control.E) C) and D)
F) B) and D)

Question 17

The matrix structure attempts to combine the advantages of the functional and product-oriented structure.

Accepted Answer

A) True 
 B)False

Question 18

If an international firm has a global strategy and a relatively low level of product diversity, the best choice for its organizational structure is a(n)  ______________ structure.

Accepted Answer

A)  worldwide functional
B)  worldwide product division
C)  worldwide matrix
D)  international divisionE) C) and D)
F) All of the above

Question 19

Which of the following is not a strategic risk of outsourcing?

Accepted Answer

A)  loss of critical skills
B)  loss of cross-functional skills
C)  loss of control over a supplier
D)  loss of non-vital functionsE) A) and B)
F) C) and D)

Question 20

Which of the following is not a disadvantage of virtual structures?

Accepted Answer

A)  difficulty in individual and organizational knowledge sharing
B)  potential loss of operational control among partners
C)  loss of strategic control over emerging technology
D)  difficulty in determining where one company ends and another begins due to close interdependenciesE) B) and D)
F) A) and D)

Exam 10: Creating Effective Organizational Designs

A major disadvantage of the functional organizational structure is that it often leads to silos in which departments view themselves as isolated, self-contained units with little need for interaction and coordination with other departments.

Correct AnswerverifiedShow Answer

Ambidextrous organizational designs are useful for firms that wish to create modest, incremental innovations at the same time as dramatic, breakthrough innovation. This is done by maintaining adaptability and alignment of values and coordination across organizational activities.

Correct AnswerverifiedShow Answer

One of the factors that explained the effectiveness of ambidextrous organizational designs in the O'Reilly and Tushman study was that the reward systems emphasized traditional unit goals.

Correct AnswerverifiedShow Answer

When evaluating structure and organizational design, managers must consider the appropriateness of the type of organizational structure and they need to assess the mechanisms, processes, and techniques that will be most helpful in enforcing internal and external boundaries.

Correct AnswerverifiedShow Answer

If an international firm has a global strategy and a relatively low level of product diversity, the best choice for its organizational structure is a(n) ______________ structure.

Correct AnswerverifiedShow Answer

Which of the following is not a disadvantage of a divisional type of organizational structure?

Correct AnswerverifiedShow Answer

Organizations are increasingly using teams for many reasons. The difference between a good team and an outstanding team has been found to be

Correct AnswerverifiedShow Answer

Which of the following is an advantage of a divisional type of organizational structure?

Correct AnswerverifiedShow Answer

Nike is a company that makes use of the concept of product expatriates. Product expatriates are

Correct AnswerverifiedShow Answer

The matrix structure attempts to combine the advantages of the functional and product-oriented structure.

Correct AnswerverifiedShow Answer

One major advantage of the holding company form of organization structure is that it minimizes the duplication of functional activities between product lines.

Correct AnswerverifiedShow Answer

According to author, Jeffrey Pfeffer, which of the following is not an advantage of teams?

Correct AnswerverifiedShow Answer

What is the name of the practice that many modular organization use to grow?

Correct AnswerverifiedShow Answer

Which of the following is not a strategic risk of outsourcing?

Correct AnswerverifiedShow Answer

If an international firm has a multidomestic strategy and a relatively high level of product diversity, the best choice for its organizational structure is a(n) ______________ structure.

Correct AnswerverifiedShow Answer

Which of the following is not a disadvantage of virtual structures?

Correct AnswerverifiedShow Answer

A major disadvantage of adopting a divisional structure is the tendency for managers to focus on short-term objectives.

Correct AnswerverifiedShow Answer

Which of the following statements about simple organizational structures is false?

Correct AnswerverifiedShow Answer

Strategic business unit (SBU) and holding company structures result from extensive

Correct AnswerverifiedShow Answer

In large organizations, a strategy of diversification requires a need to reorganize around ______________ or _____________.

Correct AnswerverifiedShow Answer

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In large organizations, a strategy of diversification requires a need to reorganize around __ or _.

Correct Answer
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