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Exam 8: Adapting Organizations to Todays Markets

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Question 131

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In the Making Ethical Decisions box,titled,"Safety versus Profit",which of the following statements best forms the theme of this passage?

A) In the beginning,company procedures that require value judgments are often too costly.As the business grows,the owner can add ethical procedures to each job.
B) The principles of organization state that the only company objective is to gain profits for the owner(s) or stockholders.If your competitors are cutting corners with safety regulations,you should consider the same.
C) The only way to be profitable is to avoid risk.If new safety equipment becomes available that is applicable to your business,even if it slows productivity,you should adopt it.
D) The corporate culture you create as you begin your service will last a long time.Your workers will adopt your values.

E) B) and C)
F) None of the above

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Question 132

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Recent changes in the organizational structure of businesses are intended to facilitate management of the firm.

A) True
B) False

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Question 133

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In a(n) _____________ organization,decision-making authority is concentrated at the top level of management.

Gangsta Industries produces a variety of anti-crime and safety products such as burglar alarms,smoke detectors,surveillance cameras,and specialty locks.Gangsta sells to households,businesses,and government agencies.They have found that each market requires a different marketing strategy.Gangsta would probably benefit from departmentalization by:

International Inns and Conference Centers [IICC],a national chain of professional event centers utilizes a centralized authority structure.Which of the following provides the most likely explanation for why management at IICC would favor centralized authority?

Departments are functional units within the business such as sales,accounting,finance,and marketing. The basic principles of organization do not differ significantly from firm to firm.As firms grow,they usually develop a system with division of labor and specialization,and then proceed to departmentalize - create departments that produce specialized tasks for the business.

Which of the following determines the degree of decentralization a firm might use?

The purpose of a division of labor and specialization is to improve an employee's job performance.

Jessica found a job at a bank,after losing her insurance company job when the firm went bankrupt.Although she has only been with this firm for a couple of weeks,she senses a rather austere climate where not too many people take the time to get to know one another.Several of her coworkers seem to get very nervous when managers walk by and breathe sighs of relief when the VP is away for the day.When she asked her supervisor why people seemed afraid of the VP,the supervisor quoted an old Tennyson poem,"Ours is not to reason why,ours is but to do and die." Jessica realizes the bank does not operate as an open organization.It lacks a thriving informal organization.It is unlikely that Jessica will feel an allegiance to this company. Organizations do not operate effectively without both the formal and informal organizations.

Joel,an employee of the engineering department,was temporarily assigned to work with specialists from other departments to develop a new product.Upon completion of this project,Joel returned to his position in the engineering department.This arrangement illustrates the use of a cross-functional team. In a cross-functional team,the members work together on a long-term basis.They may work together on more than one project,and over an extended period of time.The fact that Joel views his work on the team as temporary and plans to return to his old position when the project is completed suggests that the firm is using a matrix organization.

In recent years,large organizations have tried to improve their efficiency in communication and decision making by:

Which of the following was created as a solution to the temporary nature of the matrix structure?

Division of Labor refers to deciding how many jobs must be accomplished and then dividing them up amongst the labor force.

Cross-functional teams consist of employees from different departments who work together on a long-term basis.

Which of the following describes a group of employees from different departments working together on a long-term basis?

Rise 'n Shine Bakeries is a nationwide bakery that has plants located throughout the United States.Top management at Rise 'n Shine believes that customers in different regions have different tastes.It also recognizes that its bakeries face more intense competition in some regions than in others.Therefore,Rise 'n Shine's top management gives local managers the freedom to offer different types of breads and desserts,and to decide on a reasonable pricing strategy for its products.Rise 'n Shine typifies a decentralized organization. A decentralized organization gives decision-making authority to managers at lower levels of the hierarchy.

Centralized authority provides for the delegation of authority to employees who are then better able to respond to customers' needs.

The ____________ of a business firm is the system that details lines of authority,responsibility,and position,similar to the structure on organization charts.

Matrix organizations give managers flexibility in assigning people to projects.

Fayol's principles suggest that the goals of the firm are less important than the goals of individual workers.