Deck 9: Strategic Organisation Structure and Design

Question 1

According to Hill et al organisation structure is important only to establish reporting relationships and the hierarchy in an organisation.

Answer 1

False

Question 2

Groups are not identified in an organisation chart.

Answer 2

False

Question 3

Only managers are interested in the chain of command. To know and understand about the organisation hierarchy is of no value to employees at lower level, as long as they know their supervisor.

Answer 3

False

Question 4

Arrangement of individual jobs is usually determined within the scope of the organisation structure.

Question 5

Organisational designs reflect patterns of specialisation.

Question 6

The business historian Alfred Chandler, asked the question 'Which comes first, organisational strategy or organisation structure?' The current answer to this question is that organisational strategy comes first.

Question 7

The form of departmentalisation in which workers are grouped together according to the similarity of products, services or markets they work with or in, rather than the type of work they perform, is called the hybrid structure.

Question 8

When both functional and divisional elements are combined at the same management level, the most likely departmentalisation form is the hybrid structure.

Question 9

Decentralised decision making is likely to be one of the advantages of the matrix structure.

Question 10

Bartol suggests that increasing emphasis on knowledge management and organisational learning has lead to the development of other organisation structural configurations. These configurations include product team structure, the boundaryless organisation and the independent structure.

Question 11

An organisation which requires the least amount of technological interdependence between its various departments is said to have reciprocal interdependence.

Question 12

According to Miller's work on matching organisational strategies with appropriate forms of structure, the matrix structure was found to be the best match for market differentiation.

Question 13

An 'organisation structure' is defined as being the _____________ pattern of interactions and coordination designed by management to link the tasks of individuals and groups in achieving organisational goals.

A) formal
B) desired
C) quantified
D) recurring

Question 14

Organisation structure consists of four elements. Which of the following is not one of them?

A) Divide the work into individual jobs and assign them.
B) Collect individual jobs into appropriate groups or departments.
C) Facilitate mechanisms among and between management levels where issues, such as kinds and amounts of authority, are determined.
D) Develop key standards against which actual performance can be measured and compared to ensure organisational goals are reached.

Question 15

An organisation chart shows:

A) the detailed structure of the organisation.
B) the amount of authority assigned to organisational positions.
C) the broad outline of an organisation's structure.
D) all communication networks within the organisation.

Question 16

Organisation charts usually show a number of features about an organisation. Which of the following is not usually found in organisation charts?

A) A diagram of the informal communication networks
B) How the work and jobs are grouped into specific units or departments
C) The relative authority between managers
D) The official communication channels

Question 17

It would be most correct to say that the chain of command is the unbroken line of _____________ that ultimately links each individual with the top organisational position.

A) communication
B) authority
C) planning
D) accountability

Question 18

Departmentalisation is used to:

A) place individuals into units.
B) name larger units.
C) combine jobs into units.
D) None of the given answers is correct

Question 19

Functional, divisional and matrix are three common ____________ often used by organisations in developing their organisation structure:

A) patterns of departmentalisation
B) control systems
C) mechanisms for horizontal coordination
D) levels of authority

Question 20

Four commonly used patterns of departmentalisation used by organisations are identified. Which of the following is not one of them?

A) Co-lateral
B) Divisional
C) Matrix
D) Hybrid

Question 21

Functional structure units are grouped by:

A) expertise and years of service in the organisation.
B) similarity of expertise and position reached in the organisation.
C) Both of the given answers are correct
D) Neither of the given answers is correct

Question 22

The organisational chart for the Acacia Mutual Life Insurance Company reflects departmentalisation by:

A) hybrid.
B) division.
C) matrix.
D) function.

Question 23

Formalisation, span of management considerations, centralisation or decentralisation, and designation and line and staff positions are important organisational decisions in their own right. Collectively, however, they represent common mechanisms used for improving:

A) matrix departmentalisation decisions.
B) vertical coordination.
C) horizontal coordination.
D) the controlling function.

Question 24

Policies, rules, procedures and job descriptions and other documents detailing action taken or anticipated are all ways of specifying actions. Organisations use these to achieve:

A) coordination.
B) formalisation.
C) decentralisation.
D) centralisation.

Question 25

Which of the following would be more likely to occur if a manager had two subordinates rather than fifty?

A) Difficulty in coordination
B) A high level of decentralisation within the department
C) Overmanaging
D) Little control available to the manager

Question 26

The span of management is determined by:

A) number of employees who report directly to one manager.
B) the shape and height of the organisation structure.
C) intensity of interaction between and supervision of subordinates.
D) All of the given answers are correct

Question 27

Which of the following factors would suggest the need for a narrower span of management?

A) Some subordinates work on the third floor, others on the fourth.
B) Subordinates operate without having to interact often with their co-workers.
C) Subordinates are all doing about the same work.
D) Subordinates are particularly skilled for their positions.

Question 28

General theory would suggest that a flat organisation, as compared with a tall organisation, would have to be more decentralised, have fewer levels of management and have:

A) broader spans of control.
B) more managers.
C) more narrow spans of control.
D) matrix departmentalisation.

Question 29

Shrinking the layers of management, expanding the span of management and, quite probably, reducing the total workforce in the organisation are all characteristics of:

A) outplacing.
B) disaggregating.
C) downsizing.
D) delayering.

Question 30

The extent of centralisation affects ___________ coordination by affecting ___________ at all levels.

A) horizontal/decision making
B) horizontal/financial planning
C) vertical/decision making
D) vertical/forward planning

Question 31

Which one of the following would best reflect the benefits of centralisation?

A) The workload on executives is somewhat relieved
B) Activities of various units are easier to coordinate
C) Lower level jobs are usually enriched
D) All decision making is speeded up

Question 32

Which one of the following would best reflect the benefits of decentralisation?

A) Decisions are usually made from a broader perspective
B) There is faster decision making at the lower levels
C) Duplication of effort and resources is minimised
D) Strong leadership is promoted at the top of the organisation

Question 33

There are advantages for centralisation and for decentralisation. Which of the following factors helps tilt the decision toward more centralisation?

A) Larger size
B) Wider geographical dispersion of operations
C) Greater technological complexity
D) Decreased environmental uncertainty

Question 34

A manager can make decisions in regard to hiring staff, assigning jobs or ordering required supplies, but, at the same time, is expected to justify major changes. These significant deviations from duties or expected results are known as:

A) responsibility.
B) centralisation.
C) authority.
D) accountability.

Question 35

There are a number of reasons why managers are sometimes reluctant to delegate to their subordinates. Which of the following is not one of them?

A) Managers may fear blame if a subordinate fails
B) Managers' supervisors insist they do not delegate
C) Managers may feel threatened that competent subordinates may perform too well and possibly make them look poor by comparison
D) Managers may feel they do not have enough time or knowledge to delegate well

Question 36

Which of the following is one of the guidelines for effective delegating?

A) Try to delegate to subordinates as far 'below' you in the organisation as possible.
B) Do not make the mistake of spelling out in detail how the subordinate should approach the task.
C) Do not make the mistake of setting out the budget, equipment and/or data needed to accomplish a job.
D) Subordinates should clearly understand whether or not you can or will accommodate an error or . mistake made by the subordinate on the assignment.

Question 37

There are guidelines for effective delegating. Which of the following is not one of them?

A) Avoid the mistake of delegating the job without also spelling out in detail the approach that should be taken to do the job the way you want it done.
B) Have an idea ahead of time about what capacities each subordinate has.
C) Make each assignment within the reach, or perhaps just slightly above the reach, of the subordinate receiving the assignment.
D) Be prepared to accept occasional mistakes by subordinates.

Question 38

Three reasons have been identified why horizontal coordination supports process information across the organisation and encourages innovations. Which is not one of these reasons?

A) New ideas are more likely when many views exist.
B) Problem awareness sparks creative ideas.
C) Fewer people create a more effective working environment.
D) The more people are involved in developing ideas, the more opportunity to implement them.

Question 39

The authors suggest that another name for a managerial integrator is:

A) staff director.
B) project manager.
C) vice president.
D) line manager.

Question 40

The actual process of developing an organisation structure is sometimes referred to as organisation:

A) design.
B) planning.
C) strategy.
D) development (OD).

Question 41

The more traditional answer to the question popularised by business historian Alfred Chandler, 'Which comes first, organisational strategy or organisation structure?' was:

A) strategy.
B) structure.
C) either.
D) neither.

Question 42

The form of departmentalisation which combines workers who are performing the same kind of activities is called the:

A) hybrid form.
B) functional structure.
C) innovation reservation.
D) divisional structure.

Question 43

Production, marketing, accounting and research and development are departments in an organisation which uses the ______________ organisation design.

A) divisional structure
B) business matrix
C) functional structure
D) hybrid

Question 44

In organisation structure, the term function refers to:

A) management's major function.
B) specialised area of expertise.
C) each organisation's function in legal matters.
D) the effectiveness of organisation members.

Question 45

Which of the following statements is correct? Firms setting up functional structure:

A) utilise identical management areas before specialising at other levels.
B) include distribution management as an important management area.
C) must incorporate investment departments.
D) None of the given answers is correct

Question 46

Which of the following is considered to be an advantage of the functional structure form of organisation design?

A) It decreases interdepartmental communications requirements
B) It usually is able to respond the fastest to environmental changes
C) It has particularly good alignment of corporate and divisional goals
D) It encourages the development of expertise among employees

Question 47

The functional structure form of organisation design has a number of advantages. Which of the following is not one of them?

A) Efficient use of resources
B) Strong orientation to customer requirements
C) Possible economies of scale in operations
D) Potential technical advantage over competitors

Question 48

Exact measurement of performance, bottlenecks due to sequential tasks and backlog of decisions at top level are likely to be disadvantages of _____________ structure.

A) functional
B) divisional
C) hybrid
D) matrix

Question 49

The functional structure form of organisation design would be most appropriate for which of the following circumstances?

A) In environments where change occurs reasonably quickly
B) Large number of related products or services
C) Small and medium-sized organisations
D) Little coordination required among products

Question 50

A general manager who works in the white goods division is likely to be operating in which organisational structure?

A) Divisional
B) Functional
C) Hybrid
D) Corporate

Question 51

The divisional structure form of organisation design has a number of advantages. Which of the following is not one of them?

A) Possible economies of scale
B) Fast response to environmental change
C) Strong orientation to customer requirements
D) Accurate measurement of division performances

Question 52

Heightened competition among divisions and limited sharing of expertise across divisions are disadvantages of which structure?

A) Functional
B) Divisional
C) Matrix
D) Departmental

Question 53

Which of the following is considered to be an advantage of the hybrid structure form of organisation design?

A) Helps to align corporate and divisional goals
B) Emphasises group decision making
C) Reduces administrative overheads
D) Facilitates fast response to needs for administrative changes

Question 54

The hybrid structure form of organisation design would be most appropriate for which of the following circumstances?

A) Small-sized companies
B) Stable environment with only moderate change over time
C) Strong pressure for sharing resources between and among units
D) Considerable environmental uncertainty and a need for economies of scale

Question 55

In an organisation using the matrix structure form of organisation design, the employees report to two managers: the 'horizontal' manager is the business or project manager, the 'vertical' manager is the:

A) functional manager.
B) channel manager.
C) divisional manager.
D) lead manager.

Question 56

There are four main stages to implementing a matrix structure. Which of the following statements correctly represents one of the stages?

A) Stage 1: A traditional structure, usually divisional in nature
B) Stage 2: A temporary overlay where managerial integrator positions are created to manage more permanent tasks
C) Stage 3: A permanent overlay where managerial integrators are replaced by more senior managers
D) None of the given answers is correct

Question 57

The role of a managerial integrator is to:

A) directly work with functional department members.
B) informally supervise work of staff assigned to projects.
C) emphasise teamwork.
D) All of the given answers are correct

Question 58

Strong project or product coordination, flexible use of human resources, the ability to add or reassign functional specialists as needed and facilitate environmental monitoring are most associated with the _____________ form of organisation design.

A) hybrid structure
B) matrix structure
C) divisional structure
D) professional bureaucracy

Question 59

When an organisation improves speed, flexibility and integration by removing the restrictions caused by structures, the likely organisational structure is:

A) the networked structure.
B) the boundaryless structure.
C) the learning organisation structure.
D) the anarchy structure.

Question 60

In a knowledge management organisation structure, one of the key aspects of the structure is that:

A) workers from cross-functional organisational areas work together.
B) formal structures are removed to ensure the free flow of information.
C) people are organised into permanent cross-functional teams.
D) employees communicate with their supervisors.

Question 61

Phillips (2003) proposed a ten-pillar ideal learning organisation model. The components include leadership, communication, innovation and:

A) learning and development.
B) change management.
C) intellectual capital.
D) All of the given answers are correct

Question 62

Unit and small-batch production, large-batch and mass production and continuous-process production were the three different types of ____________ identified by Woodward during her famous study of British manufacturing firms.

A) decision
B) structure
C) production
D) technology

Question 63

A form of organising where many functions are contracted out to other independent firms, coordinated by information technology and operate as if they were a single operation is known as:

A) process structure.
B) networked structure.
C) global structure.
D) corporate structure.

Question 64

What is regarded to be perhaps the most important finding made by Woodward in her study of British manufacturing firms is that the more successful the organisation, the more likely it was to have:

A) smaller spans of control at the middle levels of management.
B) either the mass production or the continuous-process forms of technology.
C) a structural design close to the average for its particular type of technology.
D) a large size.

Question 65

A second view of technology as one of the major influences on organisation design considers the degree to which different parts of the organisation must exchange information and materials in order to perform their required tasks. This view of technology is called technological:

A) dependence.
B) sequential interdependence.
C) interdependence.
D) imperative.

Question 66

The three major types of technological interdependence are pooled, sequential and:

A) shared.
B) reciprocal.
C) essential.
D) None of the given answers is correct

Question 67

Woodward found that the correlation between the size of an organisation and its degree of complexity of organisation structure was:

A) positive.
B) negative.
C) inconclusive.
D) zero.

Question 68

In studying the relationships between organisational size and organisation structure, few, if any, significant correlations are regularly found. Trends, though, have been identified. One of those trends is that as organisations grow:

A) they become more and more centralised.
B) the number of staff positions decreases.
C) more levels of managers are added.
D) fewer rules and regulations are used.

Question 69

Burns and Stalker, in their study of British industrial firms, found that as an organisation's environment changed from stable to unstable with rapid change and uncertainty, the organisation changed from:

A) small to large.
B) being relatively mechanistic to being relatively organic.
C) small-batch technology to continuous-process technology.
D) a simple structure to a machine bureaucracy structure.

Question 70

According to the text, Lawrence and Lorsch's concept of differentiation is best summarised as:

A) the extent to which units within an organisation differ because of environmental influences.
B) how an organisation achieves its own identity and recognition from customers in competitive situations.
C) the need to increase the number of departments to better interact with changing environmental pressures.
D) the shift from simple reciprocity to pooled interdependency in turbulent environments.

Question 71

Lawrence and Lorsch found that the most effective firms in their study attempted to balance differentiation with efforts towards integration or:

A) the extent to which lateral communication networks were created.
B) collaboration among departments that needed to coordinate their efforts.
C) incorporation of matrix overlays from the vertical dimension with the horizontal.
D) independent orientations of members and departments.

Question 72

A reservation would best be described as:

A) doubts about the application of an innovative solution to a problem.
B) part of the solution from a queuing theory application.
C) a new idea that has, as yet, no apparent application.
D) an organisational unit which devotes full time to the generation of innovative ideas.

Question 73

While specialisation of jobs increases, the scope and responsibility of individual managers expands as well. To assist managers in their role, organisations combine jobs into ________________________.

Question 74

Grouping into customer similarity where there is a division for every customer type is an example of
_________________ structure.

Question 75

When organisations combine functional and divisional forms, they use the _____________ structure.

Question 76

Organisation design is the process of developing organisation structure. What are the four basic elements of structure?

Question 77

Why are organisation charts useful in assisting understanding of the chain of command?

Question 78

What are the four common departmentalisation patterns? From your own experience with organisations, give an example of how each type works.

Question 79

The four most common types of departmentalisation are functional, divisional, hybrid and matrix. Identify an organisation that you know well. What are the advantages and disadvantages of the type of departmentalisation used in your selected organisation? Give specific information where possible.

Question 80

In what ways are the five factors that contribute to the vertical coordination in organisations different?