Question 1

A ________ structure is a cluster of different organizations whose actions are coordinated by contracts and agreements, rather than by a formal hierarchy of authority.

Accepted Answer

A)   product divisional
B)   network
C)   market
D)   multidivisional B

Question 2

Which of the following types of organizational structures is most likely to use transfer pricing?

Accepted Answer

A)   functional structure
B)   product team structure
C)   product division structure
D)   multidivisional structure D

Question 3

A ________ structure is a design that groups people together on the basis of their common expertise and experience or because they use the same resources.

Accepted Answer

A)   team
B)   functional
C)   divisional
D)   product B

Question 4

The higher the level of differentiation, the more complex the integrating mechanisms that managers need to use to control organizational activities.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following statements is most likely to be true regarding a geographic divisional structure?

Accepted Answer

A)   A geographic structure allows some functions to be centralized at one headquarters location and others to be decentralized to a regional level.
B)   A geographic divisional structure is a divisional structure in which specialists from the support functions are combined into product development teams that specialize in the needs of a particular kind of product.
C)   An organization using a geographic divisional structure employs a transfer pricing mechanism to transfer its products from one geographic division to the other geographic division.
D)   Organizations that use geographic divisional structure operate in rich and dynamic environment.

Question 6

Functional structure is the foundation of horizontal differentiation.

Accepted Answer

A) True 
 B)False

Question 7

A food manufacturer is experiencing coordination problems between its frozen food division and its canned food division. The main control problem is that each product requires an entirely separate system for ordering supplies, packaging the product, and storing the product upon completion. Which structure would help solve these coordination problems?

Accepted Answer

A)   product division structure
B)   market structure
C)   multidivisional structure
D)   geographic divisional structure

Question 8

A divisional structure is a design that groups people into separate functions or departments because they share common skills and expertise because they make use of the same resources.

Accepted Answer

A) True 
 B)False

Question 9

Most Fortune 500 companies use a ________ structure because it allows them to grow and expand their operations while maintaining control over their activities.

Accepted Answer

A)   functional
B)   product divisional
C)   multidivisional
D)   market

Question 10

In a product division structure, a centralized set of support functions services the needs of a number of different product lines.

Accepted Answer

A) True 
 B)False

Question 11

Describe the advantages of a network structure.

Accepted Answer

The answer of Describe the advantages of a network structure....

Question 12

What are the disadvantages of a matrix structure?

Accepted Answer

The answer of What are the disadvantages of a matrix...

Question 13

What are the advantages of a functional structure?

Accepted Answer

The answer of What are the advantages of a functional...

Question 14

Which of the following organizational structures is the most decentralized?

Accepted Answer

A)   product division structure
B)   functional structure
C)   product team structure
D)   transactional structure

Question 15

In general, the more complex the value-creation activities necessary to produce and market goods and services, the more problems are associated with using a network structure.

Accepted Answer

A) True 
 B)False

Question 16

A functional structure has greater vertical and horizontal differentiation than a divisional structure and employs more complex integrating mechanisms.

Accepted Answer

A) True 
 B)False

Question 17

A ________ structure is commonly used by food processors, furniture makers, and companies that make personal care products, paper products, or other products that are broadly similar and use the same set of support functions.

Accepted Answer

A)   product division
B)   market
C)   multidivisional
D)   product team

Question 18

In which of the following situation, servicing the needs of new kinds of customer groups and tailoring products to suit them are is most likely to be relatively difficult?

Accepted Answer

A)   the organization operates in a rich environment
B)   the organization uses functional structure
C)   the organization has a monopoly in its respective business
D)   the organization uses matrix structure

Question 19

A matrix structure involves ________ vertical control from the formal hierarchy and ________ horizontal control from the use of integrating mechanisms.

Accepted Answer

A)   minimal; minimal
B)   minimal; maximal
C)   maximal; maximal
D)   maximal; minimal

Question 20

Under which of the following situations are managers most likely to use functional structure?

Accepted Answer

A)   The organization produces a large number of different products.
B)   The organization can easily measure the cost of each function's contribution to the development of each product.
C)   The organization produces products in several different geographic locations.
D)   The organization sells its products to only one major type of customer.

Exam 6: Designing Organizational Structure: Specialization and Coordination

A ________ structure is a cluster of different organizations whose actions are coordinated by contracts and agreements, rather than by a formal hierarchy of authority.

Which of the following types of organizational structures is most likely to use transfer pricing?

A ________ structure is a design that groups people together on the basis of their common expertise and experience or because they use the same resources.

The higher the level of differentiation, the more complex the integrating mechanisms that managers need to use to control organizational activities.

Which of the following statements is most likely to be true regarding a geographic divisional structure?

Functional structure is the foundation of horizontal differentiation.

A divisional structure is a design that groups people into separate functions or departments because they share common skills and expertise because they make use of the same resources.

Most Fortune 500 companies use a ________ structure because it allows them to grow and expand their operations while maintaining control over their activities.

In a product division structure, a centralized set of support functions services the needs of a number of different product lines.

Describe the advantages of a network structure.

What are the disadvantages of a matrix structure?

What are the advantages of a functional structure?

Which of the following organizational structures is the most decentralized?

In general, the more complex the value-creation activities necessary to produce and market goods and services, the more problems are associated with using a network structure.

A functional structure has greater vertical and horizontal differentiation than a divisional structure and employs more complex integrating mechanisms.

A ________ structure is commonly used by food processors, furniture makers, and companies that make personal care products, paper products, or other products that are broadly similar and use the same set of support functions.

In which of the following situation, servicing the needs of new kinds of customer groups and tailoring products to suit them are is most likely to be relatively difficult?

A matrix structure involves vertical control from the formal hierarchy and horizontal control from the use of integrating mechanisms.

Under which of the following situations are managers most likely to use functional structure?