Exam 15: Organizational Structure and Design

Neo-classical design differs from classical design because it includes a concern for:

Table 15.4 Five organizations in your community are being studied using Mintzberg's perspective on organizational design. One is a high-tech organization with a simple structure, decentralized authority, and support staff is the dominant element in the organization. A second company operates in a stable industry, each employee's work is highly specialized, and decision-making is concentrated at the top of the organization. There is also a family medical practice with three doctors who are partners. The operating core is the dominant element, and decision-making is vested in the doctors. Finally, there is a retail dealer mall for antiques and collectibles, which is dominated by its strategic apex element. -Refer to Table 15.4. The second company has Mintzberg's ________ design.

Matrix designs have a number of advantages, such as:

The neoclassical approach to organizational design overcomes the fault of classical design by stressing there is no one best design for an organization.

An adhocracy is most likely to occur in an organization such as ________.

What is the boundaryless organization? Discuss its various forms.

XYZ corporation has ten levels of authority between the president and the lowest level employee on the organizational chart. By contrast, ABC Corporation has only three levels of authority between the president and the lowest level. It may be said that XYZ's hierarchy of authority is ________, whereas ABC's is ________.

Differentiate between organizational structure and organizational design.

In Mintzberg's framework, the ________ is the dominant group in a simple organizational structure.

Table 15.5 INVEX, Inc. is a small manufacturer of low technology consumer goods. They want to enter the Asian market but don't know how. They form a strategic alliance with Asia Today, a marketing firm specializing in marketing U.S. goods of all kinds in Asia. INVEX, Inc. also has a relationship with another company, Small Things R' Good, a manufacturer of low technology consumer goods. They provide components to each other and INVEX will bring that company into the alliance with Asia Today. -Refer to Table 15.5. The relationship of Small Things R' Good and INVEX is what type of strategic alliance?

There are limitations to departmentalization by product, including:

Alice was a copy writer for a large advertising firm in New York, where she specialized in writing radio ads. She moved to Tulsa, Oklahoma, where she took a job at a much smaller advertising firm. Her new job required her not only to write radio ads for supermarkets, but to write copy for all radio ads, TV ads, and print ads. Sometimes she even had to produce commercials, work with artists, and even meet with clients. Compared to her former New York job, her new job:

Highly decentralized organizations:

________ eliminate chains of command, widen spans of control, and use empowered teams.

While a spin-off is separate from the original parent organization, and has its own identity, it typically shares the management team of the parent company.

When an organization outsources its noncore functions, retains control over its core business, and then arranges networks of specialists around that core that can be added to or subtracted from as needed, the business has adopted a:

Automakers like Ford, General Motors, etc., produce and market their cars through separate divisions. This is an example of:

Table 15.2 For a management class, a group of students is considering how to structure a proposed company. Their original idea was a design that would give complete responsibility for the development and marketing of a product to one unit. Tax considerations are a concern as well, and they want a structure that would help the accountants track them better through specific cost centers. They decide not to use this design because of the duplication of effort and the probability that it would be difficult to attract and retain talented employees. In their second design they want to stress the opportunity for employees to specialize, gain economies of scale, and conserve resources by eliminating duplication of effort. They reject that design because it is too cumbersome and slow to respond to the changes in the marketplace. Then one member of the group, Jack, suggests that they eliminate chains of command and spans of control and go to empowered teams. He argues that this will increase creativity and responsibility among employees. A fellow student argues that it won't work in the real world because managers won't give up that much authority. "Ok," a third student, Jane, offers, "let's try this idea but build around a hub. The hub will be the core business and the spokes will be groups of specialists that can be added to or subtracted from as the market changes." They settle on a structure with two lines of authority, one by task specialization and the other by product line. This gives them economies of scale and flexibility but some stress over reporting authority. Nevertheless, it gives them the best of what they want. -Refer to Table 15.2. Their first design is an example of a:

When an organization focuses on minimizing losses it is following a low-cost strategy.

The key to the success of a virtual organization is the mix of shared core competencies.