Deck 19: Professional Management and the Small Business

Question 1

A small business always has greater constraints in cash flow and employee expertise than found in larger corporations.

Answer 1

False

Question 2

Top-level executives in a large corporation have a distinct advantage over the leader of a small business in exerting their influence.

Answer 2

False

Question 3

The maximum number of employees who can be supervised effectively by a capable manager is four.

Answer 3

False

Question 4

A small business that has expanded beyond the comfort zone of its entrepreneur will end in bankruptcy.

Question 5

A small company's culture unfolds over the lifetime of the business..

Question 6

As a firm moves from Stage 1 to Stage 4,the entrepreneur becomes less of a manager and more of a doer.

Question 7

A manager who grants subordinates the right to act or make decisions is delegating authority.

Question 8

Owner-managers of small businesses typically overdo the amount of planning.

Question 9

Someone with a charismatic personality will make a more effective leader.

Question 10

Most very small firms use a single chain of command.

Question 11

Company planning helps clarify issues and how these issues can be faced,provides focus,and increases credibility with outsiders.

Question 12

Individuals who are launching promising startups need to have a "tolerance for ambiguity".

Question 13

The formal organization stage of business growth is a turning point because the entrepreneur must learn to rise above direct management and work through an intermediate level of managers.

Question 14

Compared to empowerment,work teams require a lower level of employee participation.

Question 15

Stage 4 of small business growth involves the use of budgets,personnel policies,organizational charts,and computerization.

Question 16

When a firm reaches Stage 2,the entrepreneur engages extensively in both the coordination of the efforts of others as well as performing basic work activities.

Question 17

Budgets are usually prepared for five years in advance using quarterly figures.

Question 18

A consultant beginning to ask employees for their marketing ideas illustrates empowerment.

Question 19

Professional managers often have more sophisticated methods of management than entrepreneurs.

Question 20

Small firms that hesitate to acquire professional management often limit growth.

Question 21

Marcia,owner of Drapes by Design,has groups of employees in production and installation.If she decides to use work teams as part of her leadership approach,she may be able to:

A)earn more in quarterly profits.
B)decrease the number of supervisors.
C)improve product quality.
D)reduce total compensation.

Question 22

The SCORE program offers entrepreneurs management advice for a small fee.

Question 23

Entrepreneurs who follow a win-win negotiating strategy seek a solution that will satisfy at least the basic interests of both parties.

Question 24

Many owner-managers seldom work more than 40 hours a week.

Question 25

If a company successfully creates properly functioning self-managed teams among employees,the supervisors will

A)feel threatened by her leadership approach to teams.
B)likely become fewer in number.
C)may attempt to delegate mundane tasks to the teams.
D)need to maintain closer supervision.

Question 26

If Elizabeth,who just hired her first employee,desires to create an innovative cultural environment within the business,what should she do?

A)Support experimentation while eliminating unnecessary penalties for failure
B)Maintain tight control of all aspects of the business.
C)Reject employee ideas.
D)Treat all employees the same.

Question 27

Workers who act on their own and to make decisions about the processes they're involved with are considered to be

A)"beginning" or nascent managers.
B)empowered employees.
C)policy-capable subordinates.
D)work-team ready.

Question 28

Leadership roles differ greatly,depending on the size of the business and its

A)stage of development.
B)product and service offerings.
C)marketing efforts.
D)industry in which the company operates.

Question 29

SBDCs are affiliated with colleges and universities and provide counseling solely through a group of retired executives.

Question 30

A positive solution should be pursued in negotiations whenever it is feasible to do so.

Question 31

To improve employee morale,an industrial distribution business might consider __________.

A)employee empowerment.
B)formulating policies after gaining employee thoughts.
C)soliciting employee input on the adoption of budgets.
D)the establishment of control standards.

Question 32

It is critical for entrepreneurs to set aside time to work undisturbed.

Question 33

Periodic performance review sessions for a company following two-way communication would discuss employee ideas,questions,complaints,and job expectations.

Question 34

Some colleges and universities offer training directly to aspiring small business owners.

Question 35

Leadership in small firms is more ____ in comparison to the leadership in large corporations.

A)haphazard
B)impersonal
C)personalized
D)skillful

Question 36

Barry's expectation that employees will complete his requests immediately is typical of ______ leaders.

A)populist
B)general
C)paragon
D)team builder

Question 37

The greatest time saver is the effective use of time.

Question 38

Linda's high standards and expectations of employee excellence is typical of ____ leaders.

A)team builder
B)general
C)populist
D)paragon

Question 39

What type of leadership style focuses on creating emotional bonds?

A)team builder
B)visionary
C)coach
D)general

Question 40

Preparing a daily written plan of activities is useful in deciding which tasks deserve highest priority.

Question 41

For small businesses,the most likely form of organizational structure is

A)functional.
B)line.
C)line-and-staff.
D)committee.

Question 42

Frequent and flagrant disregard of the chain of command undermines the position of the

A)founder.
B)operative employee.
C)staff specialist.
D)bypassed manager.

Question 43

Margaret has launched a new event planning company with four employees.With the growth in sales and personnel,the next step of growth will involve

A)increased direct supervision.
B)improved quality management.
C)intermediate supervision.
D)more formal policies.

Question 44

Susan has seen her retail shop grow to the point that she has designated supervisors for the office and two selling areas.Her shop's stage of growth is

A)formal organization.
B)intermediate supervision.
C)one-person operation.
D)player-coach.

Question 45

A small firm's basic path to the future is spelled out in a document called a

A)feasibility study.
B)short-range plan.
C)budget.
D)strategic plan.

Question 46

Mario has just begun to personally supervise employees.His firm likely to be in the ____________ stage of growth.

A)formal organization
B)intermediate supervision
C)one-person operation
D)player-coach

Question 47

John,a small business operations manager,is confronted with a quality problem.A typical small business handicap that will hamper his efforts to solve the problem is a lack of

A)time.
B)chain of command.
C)accounting data.
D)specialized staff assistance.

Question 48

As a firm grows,the small business owner needs to fill key positions with persons who

A)could be future managers.
B)can complement weaker areas of the entrepreneur.
C)are able to survive in the culture.
D)All of the above are true.

Question 49

The owner of a rapidly growing small business needs to talk to a lender for additional financing.Which document would increase the company's credibility?

A)control standards
B)human resource guidelines
C)strategic plan
D)All of the above would be needed.

Question 50

Stage 3 in the growth of a business is characterized by

A)a one-person operation.
B)hands-off management practices.
C)multi-layered organization.
D)the entrepreneur as a player-coach.

Question 51

A corporate marketing executive is moving to a managerial position in a small firm,where she may logically expect to find

A)adequate financial resources and adequate staff.
B)inadequate financial resources and inadequate staff.
C)adequate financial resources and inadequate staff.
D)inadequate financial resources and adequate staff.

Question 52

Founders are least likely to be described as a(n)

A)creative.
B)good organizational member.
C)innovative.
D)risk-taking.

Question 53

In a line-and-staff organization,which division is a line activity?

A)Production
B)Legal
C)Human Resources
D)Accounting

Question 54

Having more than one supervisor is a violation of the:

A)span of control
B)delegating
C)controlling
D)chain of command

Question 55

The fact that the daily "brush fires" of doing business tend to push aside planning until it is forgotten is the message of

A)Parkinson's Law of Planning.
B)the Peter Principle.
C)the Tyranny of the Urgent.
D)Murphy's Law of Strategic Action.

Question 56

The organizational structure of small companies is often characterized by

A)economy.
B)clarity.
C)practicality.
D)use of staff positions.

Question 57

A budget is prepared as part of a

A)strategic plan.
B)short-range plan.
C)organizational plan.
D)long-range plan.

Question 58

The use of written policies,budgets,and job descriptions is most closely associated with which stage of growth?

A)Formal organization
B)Intermediate supervision
C)One-person operation
D)Player-coach

Question 59

A monthly production schedule is prepared as part of the

A)operational plan.
B)short-range plan.
C)strategic plan.
D)tactical plan.

Question 60

A hesitancy by an entrepreneur to move through the various organizational stages can

A)limit the rate of business growth.
B)be interpreted as evidence of creativity.
C)normally provide a competitive edge to the firm.
D)provide a spark to the business because of the spontaneity it introduces.

Question 61

James is talking to another supervisor about the number of employees who report directly to him.James is talking about his:

A)span of control.
B)informal organization.
C)organizational structure.
D)chain of command.

Question 62

Vivian would like to improve two-way communication with her subordinates.Which of these ideas would be most helpful her?

A)Post daily updates on the bulletin board.
B)Announce daily production requirements over the public address system.
C)Engage employees in conversations to discuss their ideas and problems
D)Manage by walking around.

Question 63

Entrepreneurs can get management assistance from peers through

A)outside consultants.
B)SCORE advisors.
C)volunteer work in the community.
D)networking.

Question 64

Discuss the use of employee empowerment and self-managed work teams in relation to how leaders shape an innovative organizational culture.

Question 65

The personal shopper business Jeff and Christy have developed has grown so they are busy 50 hours weekly.This schedule leaves little time for them as a couple.They have decided to hire outside employees to take over some of their business responsibilities.What suggestions should they follow to ease this transition?

Question 66

Scott,a printing shop owner,believes that his business is running rather haphazardly and wants to get it under control.The first step he should take is to

A)take corrective action.
B)set standards.
C)increase inspection.
D)increase two-way communication.

Question 67

Describe the four stages of small business growth and how the owner would function.

Question 68

Marvin has just launched a consulting business.Business has been slower than expected.What advice would you give Marvin?

A)Post an ad in the local newspaper.
B)Tap into his personal and professional network.
C)Find a different line of work.
D)Take a full-time position with a company while he builds his business part-time.

Question 69

The consulting resources of universities are made available to small business firms by

A)student consulting team programs.
B)SCORE.
C)business incubators.
D)management consultants.

Question 70

Jenny is the owner-manager of a small accounting practice.She holds bi-weekly employee meetings to cover company goals,focus points for the future and keep the employees updated on current tax changes.She has developed significant bonds with the employees so they share work (and personal)problems with her more than in the past.Often Jenny can be found assisting new clients and aiding in paperwork completion especially around April 15th.What type of leadership style(s)does Jenny display and how?

Question 71

Small business service organizations that are patterned after the Agricultural Extension Service are known as

A)student consulting team programs.
B)Small Business Development Centers.
C)business incubators.
D)SCORE.

Question 72

SCORE refers to

A)the grade assigned to a small firm by the SBA.
B)the management knowledge possessed by an entrepreneur.
C)a group of retired executives who act as consultants to small firms.
D)an alliance of small firms for the purpose of bidding on government contracts.

Question 73

After identifying organizational structures of small businesses,explain how changing structures over time impact managerial responsibilities.

Question 74

Andrea designed a new household cleaning product that can be used on any surface,is environmentally friendly and performs better than other current products.As the company grew,she added employees to produce the cleaner.Recently a grocery store chain asked to sell the cleaner in a regional area.Should she continue as the CEO? At what level is the company in its development? What factors should Andrea consider as the company continues to grow?

Question 75

Effective time management requires

A)firmly established priorities.
B)self-discipline.
C)using a good time management system.
D)All of the above are required.

Question 76

Nancy just added her eighth employee,a human resource manager who will be responsible for all future hiring,training,retaining,and firing decisions.The company is in a ________ organizational structure.

A)delegated
B)line-and-staff
C)line
D)span of control

Question 77

Which time management suggestion would be the most critical for a small business owner?

A)Set aside time to work undisturbed.
B)Have a daily written plan and highlight priorities.
C)E-mail,cell phones and the Internet should be used to save time,not be a distraction.
D)Complete trivial tasks first to have something completed.

Question 78

LaToya,as the owner of a minority firm,should look to which organization first for assistance?

A)SBDC
B)SCORE
C)sponsorship of student consulting team projects
D)virtual incubators

Question 79

Controlling is the managerial function that involves the managerss

A)thinking through issues confronting a firm and developing a plan to increase productivity.
B)keeping track of performance and investigating when results deviate from the plan.
C)developing an atmosphere of cooperation and teamwork.
D)keeping an optimum number of people under supervision.

Question 80

Kathleen believes she could be more efficient inthe use of her time.To determine where improvemenst can be made,Kathleen should first:

A)list long term objectives.
B)record time spent on various activities during the day.
C)list projects that need attention.
D)assign priorities to unfinished tasks.