Deck 13: Decision Rights: Bundling Tasks Into Jobs and Subunits

Question 1

Alfred Chandler, the noted business historian, indicated that "the administrative load of the senior executives increased to such an extent that they were unable to handle their entrepreneurial responsibilities efficiently." He was speaking of the:

A) U-form of business organization.
B) M-form of business organization.
C) matrix form of business organization.
D) mixed design.

Answer 1

A

Question 2

Historically, many businesses have preferred specialized task assignment for employees over broad task assignments. Why has this been the case?

Answer 2

Specialized task assignment has two major advantages: employees develop more expertise in their specializations and are thus more productive, and companies do not need to incur costs of cross-training employees in several tasks. With specialized task assignment, coordination of tasks is done at higher levels. As many markets have become more competitive, companies can respond more quickly to changing market conditions by assigning decision rights to lower level managers who are cross trained in multiple tasks.

Question 3

In the Bagby Copy Company case study, the executives are faced with wiring ten different copiers that they make in five separate European countries. They must choose between specializing by country or specializing by manufacturing of copier type. The executives hire a lobbyist to work for a standard regulatory and sales environment across the entire European Union. Why?

Answer 3

A standard environment would reduce the need for specializing by country. With a standard environment, Bagby could reduce costs by assigning jobs based on manufacturing specialty: employees would be more efficient due to higher levels of manufacturing skills, and fewer cross training expenses would be incurred. Lower costs can increase profits.

Question 4

Dan Unowsky assigns his computer repairers four tasks: customer service, replacement of broken parts, clean-up of equipment, and sale of used equipment to customers. If the company provides a 10% commission for all sales made by employees, then:

A) employees will clearly emphasize the clean-up task.
B) employees may ignore other tasks when faced with a potential sale.
C) replacement of broken parts will clearly be favored by employees.
D) the entire production process will be speeded up by the sales incentive.

Question 5

The matrix organization is organized:

A) into functional areas of expertise.
B) by geographic region.
C) by product line.
D) by both functional specialty and product line.

Question 6

Billy Riggan is in charge of all technical developments at Always Round Tire. He makes all the choices concerning product innovations in the company. He finds that he is overworked and that several of his research scientists seem to be spending work hours playing tennis. What is going on?

Question 7

Which of the following is not a benefit of the function (U-form) organization?

A) Improved coordination among functional specialists.
B) Functional expertise.
C) Well-defined promotion path.
D) Opportunity costs of senior management.

Question 8

Dan Unowsky manages a production group in a PC repair shop. He has noticed that speed of repair is based on each worker doing one task. But if an employee is out sick, then the entire repair process slows down. Unowsky is seeing:

A) an example of coordination costs.
B) the trade-off between low cross-training costs and reduced flexibility of his employees.
C) the absolute need for every employee to be trained in all aspects of PC repair.
D) an example of managerial ineptitude.

Question 9

What are specialized task assignments and what are their advantages?

Question 10

Which of the following is not a cost of specialized task assignment?

A) Foregone complementarities across tasks.
B) Function myopia.
C) Comparative advantage of specialization.
D) Reduced flexibility.

Question 11

When a worker specializes in one task, he focuses on that one function in the production process, ignoring the whole system. This can result in:

A) higher cross training costs.
B) no trade-offs since only one task is undertaken by each employee.
C) accepting the greater complementary between one task and another.
D) function myopia that reduces overall productivity.

Question 12

Incentives are an important aspect of whether not multiple tasks should be combined into one job. How can monetary incentives help and/or hinder the process of getting a job done, particularly if it is made up of several tasks?

Question 13

What do we mean by the M-form?

Question 14

Enhanced Computers specializes in rebuilding computers. Recently reorganized into geographic divisions, the southern division headed by Dan Unowsky is outperforming the other divisions in sales and profits. However, corporate executives have noticed that Unowsky no longer sends refurbished computers to other divisions, and he has instituted special warranties and pricing systems unavailable in the rest of the company. Should Unowsky be promoted or fired?

Question 15

The most famous story about organizing tasks into jobs comes from Adam Smith's tale of the pin factory. In that story, he argues that:

A) specialization of jobs into simple tasks increases productivity.
B) cross training is critical for productivity.
C) coordination is the biggest problem of factory efficiency.
D) one worker should be assigned all tasks in pin construction.

Question 16

What are the recent trends in organization design?

Question 17

Functional (U-Form) organizations work best in:

A) large, geographically spread-out, companies.
B) companies with many products.
C) small, specialized companies.
D) industries with rapidly changing technology.

Question 18

What is a matrix organization?

Question 19

Specialized task assignment's greatest cost is ignoring the foregone ____________ across tasks.

A) comparative advantage
B) flexibility
C) complementarities
D) lower cross training costs

Question 20

What do we mean by U-form?

Question 21

Which one of the following is not a type of an organization

A) the U-form organization.
B) the M-form based on geography.
C) the matrix organization.
D) trade-off-free bundled mixed design

Question 22

Network organizations depend upon:

A) formal lines of authority.
B) formal lines of authority without any predetermined demands.
C) work groups with formal lines of authority.
D) work groups and specific projects without any formal lines of authority.

Question 23

Why did the initial companies in 1800s fail from following the design of the railroad system?

A) global competition in terms of cheaper labor abroad.
B) monitoring costs increased rapidly.
C) managers became greedy and workers began to shirk.
D) managers could not handle the complexities.

Question 24

During the 1990s there was a significant shift toward

A) granting employees broader decision authority and more specialized functions
B) granting employees narrower decision authority and more specialized functions
C) granting employees narrower decision authority and less specialized functions
D) granting employees broader decision authority and less specialized functions

Question 25

Dan Unowsky, director of re-manufacturing for the Southern Division of Enhanced Computers, finds that communication with marketing is very difficult. This is a _______ of separating marketing from production.

A) benefit
B) cost
C) necessary component
D) potential opportunity

Question 26

Which one of the following is the Japanese keiretsu?

A) u-form.
B) m-form.
C) mixed design.
D) network.

Question 27

You are a manager of a small coal mining operation. Your best design is

A) narrow task assignment to workers and no interest in specialized task
B) narrow specialization among workers without any task assignment
C) narrow task assignment and functional specialization among workers
D) broad allocation of decision rights and empowerment via delegation

Question 28

Which of the following is not a benefit of the M-form of organization?

A) Improved coordination among functional specialists.
B) Use of local product or geographic information.
C) Focus across the entire product line.
D) Improved use of senior management's time.

Question 29

Matrix organizations:

A) may decrease influence costs.
B) may decrease influence costs for some functional managers.
C) may increase influence costs for some product managers.
D) may increase influence costs.

Question 30

Some of the activities of Chase Manhattan are organized by product, some by geography and some by customer. So Chase Manhattan has

A) u-form
B) m-form
C) network organization
D) mixed design

Question 31

The IBM Credit case shows the potential of shifting from ______ tasks to _______ task assignments.

A) broad; specialized
B) specialized; broad
C) functional; geographic
D) broad; functional

Question 32

Industrial engineer Frederick Winslow Taylor was particularly rude in his recommendation that jobs be kept simple. He argued that the characteristics of lower-level workers were such that they should be assigned very limited decision rights and a narrow set of tasks. While certainly crude by today's standards, Taylor recognized that:

A) broad task assignment is necessary for complex jobs.
B) simple tasks assignment is always dehumanizing.
C) broad task assignment eliminates the need for coordination.
D) simple task assignment may improve overall productivity.

Question 33

In the IBM Credit case, the change in assignment for case workers was made practical by:

A) centralized functional management systems.
B) computerization of task input for managerial oversight.
C) elimination of cross training among credit tasks.
D) integrating credit checking with pricing, but maintaining document preparation in a separate department.

Question 34

Defense, construction and management consulting are set up as:

A) m-forms.
B) u-forms.
C) network designs.
D) matrix designs.

Question 35

During the 1990s, many companies shifted from

A) m-form to functional subunits
B) m-form to product-oriented organizations
C) product-oriented organizations to functional subunits
D) functional subunits towards more product-oriented organizations

Question 36

Large MNC's are usually set up as:

A) u-form.
B) m-form.
C) network organization .
D) mixed design.