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Exam 10: Creating Effective Organizational Designs

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Question 41

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Horizontal organization structures facilitate resource sharing and help to create a sense of common purpose.

A) True
B) False

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Question 42

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As firms expand into foreign markets, they generally follow a pattern of change in structure that parallels the changes in their strategies. Which one of the following is not a major contingency that influences the structure they choose?

A) the type of strategy that is driving the company foreign operations
B) the research and development budget commitment
C) product diversity
D) the extent of the company dependence on foreign sales

E) B) and D)
F) All of the above

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Question 43

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A worldwide product division structure is used when global strategies require that each division be responsible for overall efficiency and performance.

Functional structures are generally found in organizations in which there is a single or unrelated product or service, high production volume, and some vertical integration.

The O'Reilly and Tushman study on ambidextrous organizational designs found that there was no relationship between organizational structure, management practices employed and performance of both the breakthrough initiative and the traditional business.

Different types of boundaries place limits on organizations in order to foster high degrees of interaction with inside influences and varying levels of permeability.

What type of organization is defined as a central hub surrounded by networks of outside suppliers and specialists?

A major disadvantage of the matrix structure is that it duplicates the use of specialized personnel, equipment, and facilities.

A global start-up typically benefits from lower communication, coordination, and transportation costs.

Global start-ups occur after a corporation has exhausted all other possibilities for domestic growth.

In an ambidextrous firm, if too much focus is placed on _______ the firm with suffer low profitability in the short run.

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

A new firm with a simple structure typically increases its sales revenue and volume of outputs over time. It may also engage in some vertical integration to secure sources of supply (backward integration) as well as channels of distribution (forward integration).

Coca-Cola, Ford Motor Company, H. J. Heinz, Nike, and Procter & Gamble are working together to develop plant-based plastics. Each company brings its own competency to the table. This collaboration is an example of a _____________ organization.

The virtual type of organization is a network of independent companies linked together to share skills, costs, and access to the markets of each other.

One of the advantages of boundaryless structures is that they can be implemented without upgrading the skills of workers and managers.

In the global marketplace, managers must ensure consistency between only their corporate level strategies and the structure of their organization.

Procter & Gamble used communities of practice and human resource practices to help it achieve effective collaboration and integration across its different business units. This effort resulted in the successful development of the Crest Whitestrips product and is an example of good use of boundary-constrained organizational design.

The relationship between strategy and structure can be best described as

An advantage of the barrier-free form of organizing is that internal cooperation and shared objectives are not required for it to work.