Exam Questions | Chapter 15: Organizational Structure

Question 1

Many small companies evolve into functionally based structures as they grow larger.

Accepted Answer

True

Question 2

Lasting Skin Care Inc. is growing very fast in both sales and number of employees. It manufactures and sells skin products for youth, male, female, elderly, and ethnic populations all over the United States and several other countries. So far, the company has followed a simple structure. However, with fast-paced growth, it has become a necessity that the company explore other organizational structures. Larry, a long-time employee at Lasting Skin Care, has collected information on how some of its competitors have organized their companies. Tracks Inc. groups its employees by their different areas of expertise such as Marketing, Finance, Human Resources, and Operations. Fine Base, which is primarily in the United States, groups its activities as Northeast Division, Southeast Division, Northwest Division, Southwest Division, and Central Division. Prints Inc. has organized its employees according to the accounts they serve, such as Large Company Contracts, Internet Sales, Individual Sales, and Small Salon Direct Sales. Finally, Make safe International has grouped its business units around different types of makeup, including the Lipstick and Lip Gloss Division, the Eye shadow Division, the Foundation Division, the Mascara Division, and the Bronzer and Blush Division. Which of the following describes Tracks' organizational structure?

Accepted Answer

client-based

Question 3

Lasting Skin Care Inc. is growing very fast in both sales and number of employees. It manufactures and sells skin products for youth, male, female, elderly, and ethnic populations all over the United States and several other countries. So far, the company has followed a simple structure. However, with fast-paced growth, it has become a necessity that the company explore other organizational structures. Larry, a long-time employee at Lasting Skin Care, has collected information on how some of its competitors have organized their companies. Tracks Inc. groups its employees by their different areas of expertise such as Marketing, Finance, Human Resources, and Operations. Fine Base, which is primarily in the United States, groups its activities as Northeast Division, Southeast Division, Northwest Division, Southwest Division, and Central Division. Prints Inc. has organized its employees according to the accounts they serve, such as Large Company Contracts, Internet Sales, Individual Sales, and Small Salon Direct Sales. Finally, Make safe International has grouped its business units around different types of makeup, including the Lipstick and Lip Gloss Division, the Eye shadow Division, the Foundation Division, the Mascara Division, and the Bronzer and Blush Division. Which of the following describes Fine Base's organizational structure?

Accepted Answer

geographic

Question 4

Lasting Skin Care Inc. is growing very fast in both sales and number of employees. It manufactures and sells skin products for youth, male, female, elderly, and ethnic populations all over the United States and several other countries. So far, the company has followed a simple structure. However, with fast-paced growth, it has become a necessity that the company explore other organizational structures. Larry, a long-time employee at Lasting Skin Care, has collected information on how some of its competitors have organized their companies. Tracks Inc. groups its employees by their different areas of expertise such as Marketing, Finance, Human Resources, and Operations. Fine Base, which is primarily in the United States, groups its activities as Northeast Division, Southeast Division, Northwest Division, Southwest Division, and Central Division. Prints Inc. has organized its employees according to the accounts they serve, such as Large Company Contracts, Internet Sales, Individual Sales, and Small Salon Direct Sales. Finally, Make safe International has grouped its business units around different types of makeup, including the Lipstick and Lip Gloss Division, the Eye shadow Division, the Foundation Division, the Mascara Division, and the Bronzer and Blush Division. Which of the following describes Make safe International's organizational structure?

Accepted Answer

product

Question 5

The matrix structure gives each employee ________ chain(s) of command.

Accepted Answer

at least two

Question 6

At Blue Wall Technology, employees are grouped according to their functional expertise as well as the different vital product lines that they are working on. Thus, the company has simultaneously created a combination of a functional and a product structure. This is an example of a ________ structure.

Accepted Answer

matrix

Question 7

Matrix structures

Accepted Answer

try to take advantage of two types of structures at the same time.

Question 8

A large pharmaceutical company recently adopted a structure in order to give its top managers more responsibility and flexibility. The company is now structured around five customer groupings: major healthcare provider networks, individual consumers, small and mid-sized pharmacies, military bases and government employee facilities, and public clinics. Which of the following organizational structures has this company created?

Accepted Answer

client-based

Question 9

When Jolly Fingers Gloves, Inc., groups its business units according to where they do business-such as the North American division, the South American division, the Australian division, and the African division-it is creating which of the following organizational structures?

Accepted Answer

geographic

Question 10

A plastic injection molding company, Flexiplast, has diversified to the point that the products it sells are very different and managing them has become overwhelming. Which of the following structures would help Flexiplast manage this situation?

Accepted Answer

product

Question 11

When Lakefront Marine Company groups its business units around the different lines of boats such as the Shark, Bass, and Catfish, which of the following structures is it creating?

Accepted Answer

product

Question 12

Which of the following structures generally develop from companies with functional structures whose interests and goals become too diverse for that structure to handle?

Accepted Answer

multi-divisional

Question 13

Which of the following is a bureaucratic organizational form in which employees are grouped into divisions around products, geographic regions, or clients?

Accepted Answer

multi-divisional structures

Question 14

Katarina is the East Coast manager of Boots for You. Other managers are in charge of the West Coast, South, and Great Lakes divisions. Her brother, Jordan is a marketing manager at a different firm who enjoys watching sports with the finance and operations managers from his company. Katarina likely works in a company with a ________ structure, while Jordan most likely works in a company with a ________ structure.

Accepted Answer

geographic; functional

Question 15

The biggest weakness of a functional structure is that

Accepted Answer

employees do not communicate as well across functions as they do within functions.

Question 16

At LMNO Creating, employees are grouped according to their expertise in an area. All marketing employees are in one department, all finance employees are grouped in another department, and similarly, all human resources and manufacturing employees are in their respective departments. Which of the following structures does LMNO Creating use?

Accepted Answer

functional

Question 17

A bureaucratic structure is an organizational form that exhibits many of the facets of the ________ organization.

Accepted Answer

mechanistic

Question 18

A ________ structure is a flat organization with one person as the central decision-making figure.

Accepted Answer

simple

Question 19

A ________ structure makes perfect sense for a small organization because employees can come and go with no major ripple effects on the organization.

Accepted Answer

simple

Question 20

What is the primary reason for simple structures being perhaps the most common form of organizational design?

Accepted Answer

There are more small organizations than large ones.

Question 21

Which of the following examples illustrates a client structure?

Accepted Answer

Stone Farms has a restaurant division, a supermarket division, and a festival division.

Question 22

Which of the following examples illustrates a functional structure?

Accepted Answer

Handy Homes has a financial department, a production department, and a sales department.

Question 23

Mazie heads Grass Roots Diversified, a company that started making garden rakes in Oregon and has now diversified into a huge range of areas totally unrelated to gardening. Grass Roots has become impossible to run under its current configuration. How should Mazie redesign the organization?

Accepted Answer

group business units by rakes, furniture, shelving, and kitchen goods

Question 24

________ structures are perhaps the most common form of organizational design.

Accepted Answer

Simple

Question 25

To keep the stress level low and avoid multiple chains of command issues, managers should adopt the matrix structure.

Accepted Answer

False

Question 26

Matrix structures try to take advantage of two types of structure at the same time.

Accepted Answer

True

Question 27

The most basic bureaucratic structure is the ________ structure.

Accepted Answer

functional

Question 28

In an organic organization,

Accepted Answer

employees are encouraged to develop knowledge and expertise outside of their specialization.

Question 29

In a mechanistic organization, employees are

Accepted Answer

given a very narrow view of the tasks they are to perform.

Question 30

Organic organizations are typified by a structure that relies on

Accepted Answer

weak chains of command.

Question 31

Organic organizations are

Accepted Answer

flexible, adaptive, outward-focused organizations that thrive in dynamic environments.

Question 32

Which of the following is associated with decentralization in decision making?

Accepted Answer

wide spans of control

Question 33

In Big Bluff Heirlooms, a furniture manufacturing company, the arrival and departure times to and from work are specified to the minute, with time clocks used to control deviant behavior. It can be said that the company is high in

Accepted Answer

formalization.

Question 34

Which of the following is a necessary coordination mechanism that organizations rely on to get a standardized product or deliver a standardized service?

Accepted Answer

formalization

Question 35

Formalization refers to

Accepted Answer

the degree to which rules and procedures are used to standardize behaviors and decisions in an organization.

Question 36

If decision making is pushed down to lower-level employees, and these employees feel empowered to make decisions on their own, an organization has a ________ structure.

Accepted Answer

decentralized

Question 37

Jeff and Matthew, father and son, opened a large boutique named Modus in Chicago. Being the owners of the business, they decide all of the important matters. All the rest of the decisions like product, finance, marketing, and personnel are carried out by the department heads, who have to act according to Jeff's and Matthew's instructions and orders. Which of the following is True about Modus?

Accepted Answer

It has a centralized system of decision making.

Question 38

Centralization reflects

Accepted Answer

where decisions are formally made in organizations.

Question 39

Current research suggests that

Accepted Answer

a moderate span of control is best for an organization's productivity.

Question 40

The relationship between performance and span of control is graphed as a(n)

Accepted Answer

arch shape.

Question 41

The more people under the control of one manager, the

Accepted Answer

wider the span of control.

Question 42

Span of control

Accepted Answer

refers to the number of employees each manager is responsible for in the organization.

Question 43

Davanna is describing her company's organizational structure. Which of the following terms would she use in her description?

Accepted Answer

work specialization

Question 44

Which element of the organizational structure signifies formal authority relationships?

Accepted Answer

chain of command

Question 45

The degree to which a job requires a number of different activities involving a number of different skills and talents is referred to as

Accepted Answer

variety.

Question 46

When looking at Wonder Guard Industries' organizational structure, Janice spots a heading for work specialization, which is also commonly referred to as

Accepted Answer

division of labor.

Question 47

Work specialization refers to

Accepted Answer

the degree to which tasks in an organization are divided into separate jobs.

Question 48

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. On which element of organizational structure was Carol asked to collect evidence?

Accepted Answer

formalization

Question 49

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. On which element of organizational structure is Shane collecting information?

Accepted Answer

centralization

Question 50

At Pleasant Pools Inc., there is a total focus on providing care and satisfaction to each customer. In the Prominent Clients division, each manager is assigned 3 employees to supervise, whereas in the Component Assembly division, each manager supervises about 15 employees. The Prominent Clients division managers can be described as having ________ as opposed to ________ for the Component Assembly division managers.

Accepted Answer

a narrow span of control; a wide span of control

Question 51

Shane is the project manager of the organizational development team at Solid Hardwoods. Shane's team has been assigned the task of studying and evaluating Solid Hardwoods' organizational structure. Shane divided the tasks among the team members to collect preliminary information on different elements of Solid Hardwoods' structure. Meg was asked to collect information on the degree to which tasks are divided into separate jobs. Andrea was asked to collect information on formal authority relationships. Francine started looking into how many employees each manager has responsibility for, and Carol was asked to collect evidence on the degree to which rules and procedures are used to standardize behaviors at Solid Hardwoods. Shane decided to personally collect information and evidence on where exactly decisions are formally made at Solid Hardwoods. The team decided to meet with information in two weeks. Francine is looking into information on which element of organizational structure?

Accepted Answer

span of control

Question 52

At Buddy's Bird Barn, every employee has to consult Buddy before completing any sale, and only Buddy can make decisions about purchasing and advertising. These rules represent ________ at Buddy's Bird Barn.

Accepted Answer

centralization

Question 53

Which of the following scenarios exemplifies span of control?

Accepted Answer

Vanna is responsible for managing 16 employees.

Question 54

The managers at Microfab meet and realize that they have huge costs associated with training new employees, difficulty finding someone who can take the place of lost employees, and lower productivity than they would prefer from each employee. What can they do to address this issue?

Accepted Answer

decrease the number of tasks each employee performs

Question 55

Organic organizations are efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Accepted Answer

False

Question 56

Decentralized organizational structures tend to concentrate power and authority within a relatively tight group of individuals in the firm.

Accepted Answer

False

Question 57

A ________ span of control creates a ________ organization structure.

Accepted Answer

wide; flat

Question 58

Wide spans of control allow managers to be much more hands-on with employees.

Accepted Answer

False

Question 59

A company's chain of control determines how many employees report to each manager.

Accepted Answer

False

Question 60

The chain of command helps the organization to attain order, control, and predictable performance.

Accepted Answer

True

Question 61

In a traditional organizational structure, every employee has one person to whom they report.

Accepted Answer

True

Question 62

Employees tend to be more satisfied with jobs that require them to perform a specialized kind of activity.

Accepted Answer

False

Question 63

Henry Ford was a strong believer in work specialization.

Accepted Answer

True

Question 64

Eileen is the leader of a small compost facility that caters to organic farmers. She has to decide how many employees each supervisor will oversee, and how closely they will watch over them. This is an example of Eileen shaping her company's

Accepted Answer

organizational structure.

Exam Questions | Chapter 15: Organizational Structure

What are some of the more common organizational forms that an organization might adopt for its structure?

Many small companies evolve into functionally based structures as they grow larger.

The matrix structure gives each employee ________ chain(s) of command.

Matrix structures

When Jolly Fingers Gloves, Inc., groups its business units according to where they do business-such as the North American division, the South American division, the Australian division, and the African division-it is creating which of the following organizational structures?

A plastic injection molding company, Flexiplast, has diversified to the point that the products it sells are very different and managing them has become overwhelming. Which of the following structures would help Flexiplast manage this situation?

When Lakefront Marine Company groups its business units around the different lines of boats such as the Shark, Bass, and Catfish, which of the following structures is it creating?

Which of the following structures generally develop from companies with functional structures whose interests and goals become too diverse for that structure to handle?

Which of the following is a bureaucratic organizational form in which employees are grouped into divisions around products, geographic regions, or clients?

The biggest weakness of a functional structure is that

A bureaucratic structure is an organizational form that exhibits many of the facets of the ________ organization.

A ________ structure is a flat organization with one person as the central decision-making figure.

A ________ structure makes perfect sense for a small organization because employees can come and go with no major ripple effects on the organization.

What is the primary reason for simple structures being perhaps the most common form of organizational design?

Which of the following examples illustrates a client structure?

Which of the following examples illustrates a functional structure?

Mazie heads Grass Roots Diversified, a company that started making garden rakes in Oregon and has now diversified into a huge range of areas totally unrelated to gardening. Grass Roots has become impossible to run under its current configuration. How should Mazie redesign the organization?

________ structures are perhaps the most common form of organizational design.

To keep the stress level low and avoid multiple chains of command issues, managers should adopt the matrix structure.

Matrix structures try to take advantage of two types of structure at the same time.

The most basic bureaucratic structure is the ________ structure.

What are the major elements of an organizational structure?

In an organic organization,

In a mechanistic organization, employees are

Organic organizations are typified by a structure that relies on

Organic organizations are

Which of the following is associated with decentralization in decision making?

In Big Bluff Heirlooms, a furniture manufacturing company, the arrival and departure times to and from work are specified to the minute, with time clocks used to control deviant behavior. It can be said that the company is high in

Which of the following is a necessary coordination mechanism that organizations rely on to get a standardized product or deliver a standardized service?

Formalization refers to

If decision making is pushed down to lower-level employees, and these employees feel empowered to make decisions on their own, an organization has a ________ structure.

Centralization reflects

Current research suggests that

The relationship between performance and span of control is graphed as a(n)

The more people under the control of one manager, the

Span of control

Davanna is describing her company's organizational structure. Which of the following terms would she use in her description?

Which element of the organizational structure signifies formal authority relationships?

The degree to which a job requires a number of different activities involving a number of different skills and talents is referred to as

When looking at Wonder Guard Industries' organizational structure, Janice spots a heading for work specialization, which is also commonly referred to as

Work specialization refers to

At Buddy's Bird Barn, every employee has to consult Buddy before completing any sale, and only Buddy can make decisions about purchasing and advertising. These rules represent ________ at Buddy's Bird Barn.

Which of the following scenarios exemplifies span of control?

The managers at Microfab meet and realize that they have huge costs associated with training new employees, difficulty finding someone who can take the place of lost employees, and lower productivity than they would prefer from each employee. What can they do to address this issue?

Organic organizations are efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Decentralized organizational structures tend to concentrate power and authority within a relatively tight group of individuals in the firm.

A ________ span of control creates a ________ organization structure.

Wide spans of control allow managers to be much more hands-on with employees.

A company's chain of control determines how many employees report to each manager.

The chain of command helps the organization to attain order, control, and predictable performance.

In a traditional organizational structure, every employee has one person to whom they report.

Employees tend to be more satisfied with jobs that require them to perform a specialized kind of activity.

Henry Ford was a strong believer in work specialization.

What is an organization's structure, and what does it consist of?

Eileen is the leader of a small compost facility that caters to organic farmers. She has to decide how many employees each supervisor will oversee, and how closely they will watch over them. This is an example of Eileen shaping her company's

Which of the following shows every job in the organization and the formal reporting relationships between those jobs?

________ formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.

Organizational structure can have a significant impact on an organization's financial performance.

As companies grow larger, their organizational charts get simpler.

What is organizational design, and what factors does the organizational design process depend on?

As organizations become larger, they tend to become more ________ in nature.

The method by which an organization transforms its inputs into outputs refers to its

One element of a firm's environment is

Company strategy refers to

One of the biggest environmental factors affecting organizational structure is whether the

Organizational design is the process of

Michelle's Universal Boat Fins makes one product, a type of boat fin designed to fit on any pontoon boat, over and over again. The fins never change, because the unique design fits all boats. Given the nature of its business, Michelle's should

Talia formed a technology start-up in her garage, and it has grown more rapidly than she ever imagined. She has always kept tabs on all of her people, and her company has just passed 150 employees. What should she do now?

As companies become larger, they tend to use a combination of specialization, formalization, and centralization to control their activities, thereby becoming more mechanistic in nature.

If technologies need to be changed often to suit consumer needs, the decisions should be centralized.

Companies that follow a low-cost producer strategy believe that people will pay more for a product that is unique in some way.

What steps can organizations take to reduce the negative effects of restructuring efforts?

Which of the following actions is necessary when a company is hiring and firing at the same time?

Which of the following is the main reason behind many organizations flattening their organizations?

Which of the following has been the most common kind of restructuring in recent years?

The first step in adapting to the environment is

Tatum is the CEO of a company that is undergoing a major restructuring. How should she deal with the employees who survive the layoffs in the restructuring?

Which of the following is an example of a company flattening its structure?

Many layoff survivors experience a great deal of guilt and remorse following a layoff.

A span of control creates a organization structure.