Exam 4: The External Environment

How do organizations use planning, forecasting, and responsiveness in stable and unstable environments?

Case 4.0 AligatorAde, a regional soft drink bottling plant, produces according to the forecast it receives from corporate headquarters. The company uses the focus strategy, designating a market of persons involved in athletic sports. AligatorAde sponsors a local lacrosse team and has a reputation for positive support of sports activities. On the few occasions when production exceeds demand, corporate warehousing juggles the distribution so that the regional producers such as AligatorAde experience no significant loss. Although competitors have switched formulas several times, AligatorAde has not changed its formula because market demand for its product is stable. (Top management at corporate headquarters is considering adding a more fruity-flavoured drink to its product line, but a final decision has not yet been made.) On the line, the manufacturing department produces large batches of its drink. The product is prepared for distribution in both cans and bottles. Occasionally at the end of a run, some bottles will have special team labels affixed by machine; profitability on those few special runs is particularly high. The plant's organizational chart shows that there is a plant manager with four department heads reporting to her: manufacturing manager, administrative manager, marketing manager, and warehousing and distribution manager. The purchasing function is carried out in manufacturing, and what little R&D takes place at the regional plant is done in marketing. -Refer to Case 4.0. What is AligatorAde's current structure? Does it fit with the demands of its environment?

Which aspect of the general environment affects an organization due to rapid changes and innovations?

Often, decision makers do NOT have sufficient information about environmental factors so they have a difficult time predicting external change. What is this called?

Which of the following characterizes the mechanistic process?

What is the environment of most e-commerce companies? What does your analysis of their environment lead you to conclude about appropriate organizational design adaptation of e-commerce companies to their environment?

Which of the following can be used to erect regulatory barriers against new competitors or squash unfavourable legislation?

The general environment includes those sectors that might not have a direct impact on the daily operations of a firm but will indirectly influence it.

Sometimes nonprofit organizations have tried to reduce their resource dependence through illegal activities.

What do trend-setting toy companies or high-fashion clothing manufacturers have in common?

The environmental conditions of complexity and change create a greater need to gather information and to respond based on that information.

Which of the following is a dimension of the framework for assessing environmental uncertainty?

How might an economic recession affect the design of organizations?

What type of environment would the clothing chain Tommy Hilfiger have on the stable-unstable dimension? Explain and defend your opinion. Then use Tommy Hilfiger as an example for illustrating proper adaptation to that dimension of the environment.

When organizations depend on the environment but strive to acquire control over resources to minimize their dependence, it is referred to as cooptation.

Which characteristic most accurately describes mechanistic organizations?

If the external environment is stable, a mechanistic and formal organization can be successful.

What results from allowing customers in an auto dealership service department to talk directly to the mechanic rather than to a service manager?

The general environment includes sectors with which the organization interacts directly and that have a direct and regular impact on the organization's ability to achieve its goals.

Which of the following types of management processes do organizations in rapidly changing environments tend to have?