Deck 9: Organization Size, Life Cycle, and Decline

Question 1

Which crisis is associated with the collectivity stage of the organizational life cycle?

A) need for leadership
B) need for delegation with control
C) need to deal with too much red tape
D) need for revitalization

Answer 1

B

Question 2

Carson is the manager of Cutter's Consulting, a consulting company comprised of professionals from different fields. What would Carson be wise to do in such a company?

A) bring the organization immediately into revitalization
B) have little formalization
C) use as much authority as much as possible
D) discourage horizontal communication because it violates the chain of command

Answer 2

B

Question 3

At which stage in the life cycle of a newly established hierarchy do departments emerge and get established, along with the beginnings of division of labour?

A) entrepreneurial
B) formalization
C) collectivity
D) elaboration

Answer 3

C

Question 4

Which of the following is the primary reason the CEO of a large company such as Tim Hortons would push decisions as far down the hierarchy as he or she can?

A) to develop managers
B) to make decisions more quickly
C) to appear more Canadian and thereby increase sales
D) to save himself or herself the trouble of making these decisions

Question 5

Which of the following was developed to maintain the efficiency and control benefits of bureaucracy yet prevent the problem of slow response to crises?

A) big-small hybrid
B) market control
C) clan control
D) incident command system

Question 6

Tyler Jones is the CEO of a medium-sized manufacturer of bedding and blankets. Tyler insists on making all decisions on what styles are manufactured; the type of material that will be used in each; the sources from which the company will purchase yard goods, thread, and buttons; and the shippers the company will use. Which of the following terms describes this company?

A) routinized
B) centralized
C) formalized
D) standardized

Question 7

Which term is defined as the use of rules, policies, hierarchy of authority, written documentation, standardization, and other mechanisms to standardize behaviour and assess performance?

A) market control
B) bureaucratic control
C) traditional control
D) clan control

Question 8

What are small businesses characterized by, in contrast to large businesses?

A) niche-finding strategies
B) a decreasing percentage of employees in the economy as a whole
C) fewer numbers, as merger mania continues to create a larger proportion of large firms in the world economy
D) the front/back combinations that combine small units into larger ones

Question 9

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

A) growth
B) goal-setting
C) survival
D) complete organizational structure

Question 10

Why did Max Weber develop the concept of a bureaucracy?

A) to make organizations more rational and efficient
B) to make organizations more empathetic
C) to make organizations less formal
D) to make organizations quicker to respond to stakeholders

Question 11

Which of the following is a characteristic of the formalization stage of the organizational life cycle?

A) frequent communication
B) top management concern with planning and strategy
C) establishment of departments
D) market survival

Question 12

Which of the following best describes organizations going through the organizational life cycle?

A) They usually reach elaboration in 12-18 months.
B) They tend to become very bureaucratic by the collectivity stage.
C) They usually resolve crises associated with each stage, or face restricted growth.
D) They tend to experience their wildest and most rapid growth period in the formalization stage.

Question 13

When do organizations begin to develop clear goals and direction?

A) entrepreneurial stage
B) elaboration stage
C) formalization stage
D) collectivity stage

Question 14

What was the purpose of rules and standard procedures as developed by Weber?

A) to help managers get tough with lazy employees
B) to keep managers in their positions of control and power
C) to enable activities to be performed in a predictable and routine manner
D) to punish anyone who got out of line

Question 15

What has research on personnel ratios found?

A) that clerical and professional support staff ratios decrease in proportion to organization size
B) that small organizations are very inefficient because direct workers as a percentage of total employees are so low
C) that personnel ratios for professional support staff are higher in small firms than in large firms
D) that there is a smaller administrative ratio in large firms

Question 16

In the incident command system, who or what ensures all activities that occur are appropriate?

A) clan control
B) the professional partnership
C) the incident commander
D) bureaucratic control

Question 17

What term is used for a relatively new form of organization that includes medical practices and law firms?

A) incident commanders
B) clan members
C) professional collaborations
D) professional partnerships

Question 18

Two brothers, Jake and Tommy, were hired by an organization with a bureaucratic organizational structure. Because they had different sets of skills, they ended up working in different parts of the organization. Which dimension of bureaucracy is this an example of?

A) rules and procedures
B) specialization and division of labour
C) hierarchy of authority
D) trained employees

Question 19

Which of the following is based on the idea that the organization can glide smoothly between a highly formalized, hierarchical structure that is effective during times of stability and a more flexible, loosely structured hierarchy when needed to respond well to unexpected and demanding environmental conditions?

A) decentralization
B) incident command system
C) clan control
D) formalization

Question 20

Which of the following is high formalization most closely associated with?

A) organic structure
B) bureaucracy
C) large size
D) responsive style

Question 21

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.

Question 22

Larry is a great leader who has run his organization for many years, and has the kind of personality that everyone wants to be around. What type of authority does Larry have?

A) rational-legal
B) traditional
C) charismatic
D) informal

Question 23

Shelli's organization operates in an industry with a great deal of competition that produces a commodity-type product. She measures success based on cost control and profit maximization. Which form of control does she use?

A) bureaucratic
B) clan
C) traditional
D) market

Question 24

In which stage does denial occur despite signs of deteriorating performance?

A) the blinded stage
B) the inaction stage
C) the faulty action stage
D) the crisis stage

Question 25

Which of the following is a factor that causes organizational decline?

A) vulnerability
B) increased product prices
C) increased market control
D) organizational realignment

Question 26

The big/small approach may be used to combine small units in order to gain advantages of efficiencies.

Question 27

Which type of authority is the most widely used form to govern internal work activities and decision making, particularly in large organizations?

A) traditional
B) charismatic
C) appointed
D) rational-legal

Question 28

Which type of authority refers to employees' belief in the legality of rules and the right of those elevated to positions of authority to issue commands?

A) charismatic authority
B) rational-legal authority
C) traditional authority
D) competitive authority

Question 29

In the collectivity stage, departments are established along with a hierarchy of authority, job assignments, and a beginning division of labour.

Question 30

There are ten stages of life cycle development an organization must generally go through in order to reach the final stage when rewards are personal and aimed at those who contribute to organizational success.

Question 31

Ninety-nine percent of businesses that make it past the first year still fail within five years because they can't make the transition from the entrepreneurial stage.

Question 32

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

Question 33

What term is used for a condition in which a substantial, absolute change in an organization's resource base occurs over a period of time?

A) organization dissolution
B) organizational life-cycle
C) organizational decline
D) organizational inaction

Question 34

The life-cycle phenomenon is a powerful concept used for understanding problems facing organizations and how managers can respond in a positive way to move an organization to the next stage.

Question 35

When downsizing, which of the following helps eases the downsizing process and reduces tension of both employees who leave and those who remain?

A) helping the remaining employees focus on their daily tasks by providing more guidance or assistance
B) communicating less, not more
C) providing assistance to workers who were let go
D) letting workers deal with the situation on their own and in their own way

Question 36

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

Question 37

Despite the increasing size of many companies, the economic vitality of North America is tied to small and mid-sized businesses.

Question 38

In what stage does the organization face serious problems, and indicators of poor performance can no longer be ignored?

A) the faulty action stage
B) the dissolution stage
C) the blinded stage
D) the crisis stage

Question 39

In what kind of organizations is clan control most often used?

A) small, informal organizations or ones with a strong culture
B) small, formal organizations or ones with a weak culture
C) large, informal organizations or ones with a weak culture
D) large, formal organizations or ones with a strong culture

Question 40

The following organization is in its collectivity stage: Employees at Ace identify with the company mission and goals, and they typically put in 55-hour work weeks. Ace is established in the marketplace, and is concentrating on getting more and more dealers to sign on. Ace does not have a written policies and procedures manual for its own employees.

Question 41

The incident commander is ultimately responsible for all activities that occur, and everyone knows clearly who is in charge of what aspect of the situation.

Question 42

Discuss the approaches to reducing bureaucracy.

Question 43

Describe the differences between large and small organizations.

Question 44

Traditional authority refers to control coming from the exemplary character of an individual and the aura he or she creates.

Question 45

Identify an organization in which you have worked. Analyze its management as related to the size of the organization.

Question 46

The general finding concerning incident commanders is that branches have substantial autonomy and decentralized authority to make necessary decisions.

Question 47

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 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?

Question 48

The bureaucratic control system was developed to maintain the efficiency and control benefits of bureaucracy yet prevent the problem of slow response to crises.

Question 49

Is bigger organization size better? Whether you say yes or no, defend your answer. Then explain the countering or opposite position, trying to make it as convincing an argument as you can.

Question 50

Clan control is generally used by companies that are small and informal or have a strong culture.

Question 51

The manager of an established small manufacturing plant said, "We can't compete with large organizations, because they have the advantage of economies of scale." Use arguments from the chapter to discuss his position, explaining any factors that might tend to counter it. How should he manage in order to take advantage of the firm's small size?

Question 52

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

Question 53

As organizations become larger, a smaller percentage of technical and professional support staff is recommended.

Question 54

Weber's prediction of the triumph of bureaucracy proved accurate.

Question 55

Increased training can substitute for bureaucratic rules and procedures.

Question 56

Explain the relationship between organization size and at least three specific structural characteristics.

Question 57

As organizations increase in size, the net effect for direct workers is that they decline as a percentage of total employees.

Question 58

Market control is most frequently used in the control of functional departments.

Question 59

Communicating more, providing assistance to displaced workers, and helping the survivors thrive are three ways for organizations to deal with downsizing.

Question 60

As organizations become larger, greater centralization is necessary.

Question 61

If Max Weber were living in Canada today, and observing the push away from bureaucracy, what do you think he would say? Would he defend the use of bureaucracy today, or are there different environmental factors that would cause him to abandon bureaucracy?

Question 62

Government organizations often seem to be more bureaucratic than for profit organizations. Could this partly be the result of the type of control used in the organizations? Explain.

Question 63

Explain the patterns found in the study of personnel ratios for administrative, clerical, and professional support staff.

Question 64

Compare and contrast the three types of organizational control strategies.

Question 65

Describe the life cycle of a specific organization that has gone through at least three stages of the organizational life cycle. In your answer explain the crisis this organization is now facing, and how you would recommend that it overcome its crisis.

Question 66

Describe the incident command system.

Question 67

Discuss how an organization can help smooth the downsizing process and ease tensions for employees who leave and employees who remain.

Question 68

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 the optimum size for a business is. Write your response to him.

Question 69

Max Weber wrote during a time in world history when favouritism and payoffs were common techniques for personnel action. He was opposed to such methods. What did he recommend as the basis of control for organizational decisions and activities?

Question 70

How should personnel ratios be managed in a small firm?

Question 71

Why would a large organization tend to be more formalized?

Question 72

Discuss each stage of the life cycle.

Question 73

Discuss the causes for organizational decline. List and define the stages of organizational decline.

Question 74

Describe Weber's dimensions of bureaucracy and bases of organizational authority.