Exam 9: Organization Size, Life Cycle, and Decline

Your rich uncle owns his own entrepreneurial business and is trying to decide how large it should become. He has asked you to tell him what is the optimum size for a business. Write your response to him.

What is the major goal of an organization during the entrepreneurial stage of the life cycle?

____ is the use of social characteristics, such as shared values, commitment, traditions, and beliefs to control behavior.

The elaboration stage involves the installation and use of rules, procedures, and control systems.

Apple was in the ____ stage when it was created by Steve Jobs and Stephen Wozniak in Wozniak's parents' garage.

Managers at the American Red Cross are struggling with raising enough funds to cover expenses. Donations have been declining for several years, and major disasters have strained the organization's resources. Which of the following is considered responsible for the organizational decline at the American Red Cross?

As organizations become larger, a larger percentage of top administrators is necessary.

Large size enables companies to take risks that could ruin smaller firms, and scale is crucial to economic health in some industries.

Which of the following is the use of rules, policies, hierarchy of authority, written documentation, standardization, and other bureaucratic mechanisms to standardize behavior and assess performance?

During the ____ stage, the organization begins to develop clear goals and direction.

Weber believed that a well-managed bureaucracy would ensure efficient organizational functioning in both government and business settings.

Why would a large organization tend to be more formalized?

As organizations become larger, greater centralization is necessary.

Organizations going through the life cycle:

Crucial arguments for success in a global economy are:

An e-commerce organization is in its sixth month of online operations selling academic regalia for graduation. The founders had long had their own personal web pages, and had stumbled upon an inexpensive source for the sewing of gowns. They invested all their savings and took out a loan in order to finance the inventory and equipment needed to go into business. By March of its first year of operations, an unexpectedly large number of orders reached the company. The founders devoted their full energies to getting the product where it needed to be in time for graduation. At odd hours of day and night, they could be found doing anything from the job of the information systems specialist they had recently hired, to the job of the mail clerks. As this company grows and takes on related product lines, what would you expect to happen as they go through the stages of development?

According to the Small Business Administration, small businesses represent around _____ percent of all firms in the United States.

Which of the following is not true regarding organizations in the entrepreneurial stage of development?

In a large company going through the organizational life cycle, the replacement of top management may occur in its elaboration stage as it struggles to revitalize.

Small organizations are characterized by which of these?