Deck 8: Control, Change, and Entrepreneurship

Question 1

The process by which managers monitor and regulate how efficiently and effectively an organization and its members are performing the activities necessary to achieve organizational goals is known as

A)organizing.
B)leading.
C)controlling.
D)coordinating.

Answer 1

C

Question 2

Managers at Foster and Zapp Construction set up a stringent job interview process by which management applicants are carefully screened at different levels of the organization before they are hired, attempting to increase the chance that newly hired managers will have the knowledge and skills they need to be successful within the organization. By using this process, Foster and Zapp is using ________ control.

A)concurrent
B)feedforward
C)feedback
D)MBO

Answer 2

B

Question 3

Control by means of a comprehensive system of rules and standard operating procedures that shape and regulate the behavior of divisions, functions, and individuals is known as bureaucratic control.

Answer 3

True

Question 4

Futura Fabricators gives specifications to its suppliers of raw materials in an attempt to improve the quality of those raw materials and to minimize and anticipate the problems they are likely to face in the conversion process. This is an example of ________ control.

A)concurrent
B)feedforward
C)feedback
D)bureaucratic

Question 5

Adaptive cultures are those whose values and norms help an organization to build momentum and to grow and change as needed to achieve its goals and be effective.

Question 6

Standard operating procedures are mechanisms for clan control.

Question 7

Output control procedures are used at every management level of an organization.

Question 8

Using the controlling function, managers monitor and evaluate the organization's strategy to evaluate whether it is working as intended.

Question 9

The formal target-setting, monitoring, evaluation, and feedback systems that provide managers with information about whether the organization's strategy and structure are working efficiently and effectively are known as ________ systems.

A)operating
B)organizational
C)control
D)recurrent

Question 10

The first step in the control process is to evaluate results in terms of performance standards.

Question 11

The control system that is typically used in a garment plant to solve problems like substandard inputs, broken machine parts, or a worker's skill deficiency to produce a particular type of garment is ________ control.

A)feedforward
B)MBO
C)feedback
D)concurrent

Question 12

Managers use benchmarking to compare one employee's productivity to that of another employee.

Question 13

Managers use feedforward control to anticipate problems.

Question 14

Windward Bank set up a management information system that gives its regional managers information about changes in the task environment that may affect the organization at some future time. By using this system, Windward is utilizing ________ control.

A)feedforward
B)feedback
C)bureaucratic
D)MBO

Question 15

Gazelle Computers monitors the number of customer returns for each product model to track when the organization is producing a large number of defective products. In this case, Gazelle is using ________ control.

A)feedforward
B)concurrent
C)MBO
D)feedback

Question 16

A person who works for a company and works to create new or improved products for that company is an example of an intrapreneur.

Question 17

The type of control that managers typically use in the input stage of the process of transforming raw materials into finished goods is ________ control.

A)feedforward
B)concurrent
C)feedback
D)bureaucratic

Question 18

At the output stage, managers usually utilize ________ control.

A)MBO
B)bureaucratic
C)feedforward
D)feedback

Question 19

The control system that managers use at the conversion stage of transforming raw materials into finished goods is ________ control.

A)feedforward
B)bureaucratic
C)concurrent
D)feedback

Question 20

The inventory turnover ratio is an example of the activity ratio of an organization.

Question 21

The step of the control process utilized by managers to evaluate whether the actual performance of the organization differs significantly from the standards of performance that assess the organization is

A)measuring actual performance.
B)comparing actual performance to the standards.
C)initiating corrective action.
D)measuring standards of performance.

Question 22

The manager of 24-7, a convenience store, keeps track of the average sale amount for each customer as a way of deciding on the product mix to be carried in the store. This is an example of ________ control.

A)feedforward
B)output
C)input
D)MBO

Question 23

Amir, the manager of Kaleidoscope Toys, installed new machinery to speed up the production process after the assigned targets were not achieved for the third week of the month. With regard to the control process, Amir is

A)establishing the standards of performance.
B)measuring the actual level of performance of employees.
C)evaluating the result of the set standards.
D)initiating corrective actions.

Question 24

Charlene, the manager of CraftRite Leather Goods, checked the weekly records and discovered that the number of handbags produced in one week by 45 employees was 375 against the set target of 450 handbags. With reference to the control process, Charlene is

A)establishing the standards of performance.
B)measuring the actual level of performance of employees.
C)comparing the actual performance against chosen standards of performance.
D)evaluating the result of the set standards.

Question 25

The current assets of Kaiser Investments are valued at $25 million and its current liabilities are at $6 million. If its inventory is worth $1 million, what is its quick ratio?

A)4
B)0)25
C)0)14
D)3)6

Question 26

In which of the following situations do you think it would be most challenging for a manager to measure employee outputs or behavior?

A)Workers in a clothing factory are doing hand-stitching on dresses.
B)Graphic designers at a media company are designing logo prototypes.
C)A clerk at a convenience store is recording inventory for the past month.
D)The sales team at a real estate company is cold-calling prospective clients.

Question 27

Martel, the production manager of Firefly Shoes, sets a production target of 220 shoes to be distributed among 20 employees in a week. In the context of the control process, Martel

A)establishes the standards of performance.
B)measures the actual level of performance of employees.
C)compares the actual performance against chosen standards of performance.
D)evaluates the result of the set standards.

Question 28

The standard of performance that measures efficiency at the corporate level of the organization is known as

A)cost of goods sold.
B)capital costs.
C)net sales.
D)operating costs.

Question 29

Which of the following activities might a manager perform if he or she is at the final stage of the control process?

A)deciding whether to take corrective action to meet the standard
B)restructuring the work process to increase efficiency
C)developing a performance standard to measure behavior
D)determining the factors that are affecting employee output

Question 30

The final step in the control process is

A)evaluating results and initiating corrective action.
B)measuring actual performance.
C)comparing actual performance to the set standards.
D)measuring the standards of performance.

Question 31

The managers of Sputnik Diner, a fast food restaurant, record outputs on a daily basis by counting how many customers their employees serve, the time each transaction takes, and how much money each customer spends every day. With reference to the control process, the managers of Sputnik are

A)establishing the standards of performance.
B)measuring the actual level of performance of employees.
C)comparing the actual performance against chosen standards.
D)evaluating the result of the set standards.

Question 32

The financial ratio that measures the ability of the organization to pay its short-term debts is the ________ ratio.

A)leverage
B)liquidity
C)activity
D)profit

Question 33

The sales of Audiophile, a manufacturer of home and professional audio systems, have been declining noticeably over the last several quarters. Muaad, the CEO, meets with several managers, including Bruno, the head of the customer service department, and Ilya, a customer response team leader. It is determined that, while the company's quality and innovation standards are being met and even exceeded, its customer service is not performing as well as it should be. Muaad decides to implement a goal of raising the quality of Audiophile's interactions with customers by their next quarterly meeting. Given what you know about the control process, what should the team at Audiophile do next?

A)Muaad should meet with Bruno and Ilya to decide if a five-star rating scale is sufficient for measuring their progress and whether they need to reach a 4- or 4.5-star average.
B)Bruno should evaluate the behaviors of customer service teams by having Ilya collect and report data measuring the specifics of customer interactions.
C)After three months, Bruno should look at the results of the new actions undertaken by Ilya's team and decide whether they need further improvement.
D)Over the next month, Ilya should track the number of customer interactions and record how quickly team members responded.

Question 34

An organization's net income before taxes divided by the total assets of the organization is known as

A)gross profit margin.
B)return on investment.
C)the debt-to-assets ratio.
D)days sales outstanding.

Question 35

The manager of East India Ice Cream Shop keeps track of the number of customers served at different periods of the day in an attempt to plan a schedule for workers that matches the demand for the restaurant's products. By using this tracking system, the manager of East India is utilizing ________ control.

A)output
B)bureaucratic
C)input
D)MBO

Question 36

The most commonly used financial performance measure that allows managers of one organization to compare performance with that of other organizations is

A)gross profit margin.
B)the debt-to-assets ratio.
C)the inventory turnover ratio.
D)return on investment.

Question 37

The CEO of a company would like to know whether his managers can pay off claims of short-term creditors without selling inventory. What ratio will help him understand the company's liquidity?

A)inventory turnover ratio
B)quick ratio
C)current ratio
D)debt-to-assets ratio

Question 38

Constantinople Trading Co., a manufacturer of home decor goods, sets up a system to monitor unit sales of its products to measure changes taking place in customer tastes and the possible resulting impact on future sales. With this system, Constantinople is using ________ control.

A)feedforward
B)feedback
C)MBO
D)bureaucratic

Question 39

The ratio that is computed by dividing the difference between current assets and inventory by current liabilities is the ________ ratio.

A)inventory turnover
B)quick
C)current
D)debt-to-assets

Question 40

The performance ratio that measures the efficiency of the organization in terms of how well the resources of the organization have been used to generate profit is a(n)________ ratio.

A)activity
B)leverage
C)profit
D)liquidity

Question 41

The financial ratio that indicates the degree to which the organization uses debt or equity to finance its ongoing operations is the ________ ratio.

A)leverage
B)liquidity
C)activity
D)profit

Question 42

When a manager is told to maximize the revenues from the sales of goods and services produced, this is an example of a(n)________ budget approach.

A)quality
B)revenue
C)operational
D)fixed

Question 43

Calculate the return on investment from the information given below. Net Income = $18,000; Advertising Expenses = $220,000; Total Liabilities = $120,000; Total Assets = $160,000; Gross Margin = $80,000; Taxes Paid = $2,000

A)16.67 percent
B)15 percent
C)11.25 percent
D)12.5 percent

Question 44

The manager of a profit center is evaluated on the basis of the amount of sales that have been generated from the goods or services produced in his/her division. The divisional manager is being evaluated using the ________ budget approach.

A)expense
B)cash flow
C)revenue
D)profit

Question 45

Rules and SOPs are used to regulate the behavior of workers within the organization with a ________ control system.

A)bureaucratic
B)feedback
C)feedforward
D)concurrent

Question 46

The financial ratio that measures how well the managers of the organization are creating value from the organization's assets is the ________ ratio.

A)leverage
B)liquidity
C)current
D)activity

Question 47

The most immediate and potent form of behavior control is

A)direct supervision.
B)clan control.
C)bureaucratic control.
D)socialization.

Question 48

A mechanism of control utilized in organizational culture is

A)direct supervision.
B)management by objectives.
C)socialization.
D)organizational goals.

Question 49

From the information given below, calculate the organization's return on investment. Total Liabilities = $300,000; Total Assets = $600,000; Gross Margin = $200,000; Net Income before Taxes = $30,000; Total Expenses = $240,000

A)50 percent
B)5 percent
C)10 percent
D)12.5 percent

Question 50

With management by objectives, the first things established are

A)evaluations.
B)organizational objectives.
C)management goals.
D)subordinate goals.

Question 51

When a divisional manager is evaluated based on the operating income of his division, this is an example of a(n)________ budget approach.

A)capital
B)revenue
C)expense
D)profit

Question 52

Rules and SOPs are of little use in telling a scientist how to discover something new. Thus, which of the following forms of control should not be applied to scientists?

A)feedforward
B)feedback
C)bureaucratic
D)concurrent

Question 53

The financial ratio that indicates whether or not the organization is capable of paying off its short-term debts without having to sell its inventory is the ________ ratio.

A)quick
B)current
C)days sales outstanding
D)profit

Question 54

The financial ratio that indicates how efficiently the managers of the organization are collecting the revenue due to the organization from the sale of its products or services is the ________ ratio.

A)debt-to-assets
B)quick
C)current
D)days sales outstanding

Question 55

Calculate the current ratio of the organization from the information given below. Sales = $200,000; Gross Profit = $40,000; Total Assets = $450,000; Current Assets = $250,000; Current Liabilities = $300,000

A)0)44
B)0)56
C)0)67
D)0)83

Question 56

A divisional manager's performance is evaluated on the basis of the difference between the sales revenues generated by that division and the cost of making those goods and services. The divisional manager is being evaluated using the ________ budget approach.

A)profit
B)revenue
C)cost
D)expense

Question 57

When a manager is evaluated on the difference between sales revenue and the budgeted cost of making those goods and services, this is an example of a(n)________ budget approach.

A)revenue
B)cash flow
C)expense
D)profit

Question 58

Management by objectives is a mechanism of control with ________ organizational control systems.

A)input
B)clan
C)output
D)behavior

Question 59

From the information given below, calculate the organization's current ratio. Total Liabilities = $750,000; Current Liabilities = $220,000; Total Assets = $700,000; Current Assets = $176,000

A)0)65
B)0)25
C)0)70
D)0)80

Question 60

The managers of a division are given a fixed budget and are then evaluated on the basis of their ability to produce goods or services. This is an example of a(n)________ budget approach.

A)expense
B)profit
C)cash flow
D)revenue

Question 61

The set of values, norms, and expectations of behavior that control the ways in which workers interact with one another within the organization is known as

A)managerial objectives.
B)organizational culture.
C)clan control.
D)adaptive culture.

Question 62

When an organization has a culture that leads to values and norms that fail to motivate or inspire employees, eventually leading to stagnation and often failure over time, that company has a(n)________ culture.

A)adaptive
B)inert
C)communal
D)bureaucratic

Question 63

Santiago has taken a new job as the general manager at Durwood Industries, which designs and manufactures custom cabinets. He is replacing Evan, who recently retired. Santiago has already set a company-wide goal of increasing efficiency and reducing waste. Unfortunately, Santiago has inherited a heavily bureaucratic work culture governed by byzantine rules. Evan mainly managed by actively overseeing his employees, but from the employee's lack of motivation, Santiago can tell that this approach is no longer working. Based on what you know about behavior control, what solution should Santiago implement to increase employee engagement and productivity?

A)He should have floor managers and employees jointly set goals that describe what employees can personally do to reduce waste and then periodically check in with them to monitor their progress.
B)He should require employees to turn in a report at the end of every week that details the number of cabinets they completed, the amount of materials they used, and how many pounds were thrown away.
C)He should sits in on team meetings and encourage employees to vent their frustrations with Evan's way of doing things so that whatever Santiago implements looks good in contrast.
D)Since team leaders and lower-level managers have so much responsibility, Santiago should resist asserting his authority and instead focus on keeping clients happy.

Question 64

Ysabel has just been hired in the advertising department at Ingenue, a cosmetics and skincare company. The environment at her new job could not be more different from her old one. At her old company, workers sat in closed-off cubicles or glassed-in offices, whereas Ingenue has fun decor and an open office plan. Managers have regular one-on-one meetings with employees to discuss career development and offer mentoring, and the company offers regular classes and workshops. The emphasis is on creativity and collaboration, and teams celebrate each other's accomplishments with spontaneous parties and excursions. What else is likely true about Ysabel's new job?

A)Ysabel does not know much about company values because it is taken for granted that everyone knows what they are.
B)The managers in the advertising department allow Ysabel and her co-workers to make certain decisions, such as angles for ad campaigns.
C)The managers constantly talk about excellence, and Ysabel's team is expected to submit ad proposals that are more like finished products than rough drafts.
D)It is expected that Ysabel's team will stay late and even come in on the weekends whenever the company releases a new lotion or other product.

Question 65

Jae-Kyu, a worker at Chelsea Motor Scooters, comes up with a new way to attach the fuel injection system to the motor, increasing the efficiency of the assembly process. The managers instruct all employees to attach fuel injection systems the same way so that every car comes off the assembly line with its fuel injection system attached in the new way. The managers are using ________ control.

A)bureaucratic
B)clan
C)output
D)input

Question 66

Which of the following problem is most likely to occur when a company becomes overly bureaucratic?

A)Employees eventually rebel against the rules.
B)The company becomes less efficient over time.
C)It leads to a toxic work culture and more turnover.
D)Employees stop thinking for themselves.

Question 67

Companies with an inert culture

A)closely supervise their employees within a hierarchical system.
B)develop long-term career paths for their employees.
C)invest heavily in training and development of employees.
D)encourage the development of supportive work attitudes and behaviors.

Question 68

In an adaptive culture, employees often receive rewards based on their

A)performance.
B)commitment.
C)seniority.
D)popularity.

Question 69

Top managers in a company decide between themselves to implement an employee stock ownership plan for all their employees. This is an example of a company taking a

A)top-down approach to promote adaptive culture.
B)bottom-up approach to promote adaptive culture.
C)top-down approach to promote inert culture.
D)bottom-up approach to promote inert culture.

Question 70

Which of the following is true of an adaptive work culture?

A)There is a strong emphasis on close supervision of workers.
B)Employees are not rewarded on their performance.
C)Cross-functional team structures are often used.
D)The company sticks to tried and true methods of doing things.

Question 71

When actions are performed by employees the same way time and time again and the outcomes of their work are predictable, employee behavior is

A)generalized.
B)standardized.
C)maximized.
D)minimized.

Question 72

The process through which managers try to increase members' abilities to understand and appropriately respond to changing conditions is known as

A)norm enforcement.
B)adaptive learning.
C)organizational learning.
D)clan control.

Question 73

Which of the following stages in making organizational change includes deciding whether change will occur from the top down or from the bottom up?

A)assess the need for change
B)decide on the change to make
C)implement the change
D)evaluate the change

Question 74

________ tends to be the first type of control that all managers use to evaluate performance.

A)Direct supervision
B)Management by objectives
C)Output control
D)Bureaucratic control

Question 75

Which of the following stages in making organizational change includes benchmarking?

A)assess the need for change
B)decide on the change to make
C)implement the change
D)evaluate the change

Question 76

The aspects of organizational functioning that are affected by organizational change

A)include organizational culture and strategies.
B)include response to opportunities but not threats.
C)exclude the human resource management system.
D)exclude communication, motivation, and leadership.

Question 77

The control that is imposed on workers within the organization by the shared values, norms, standards of behavior, and expectations is ________ control.

A)bureaucratic
B)operating
C)clan
D)leverage

Question 78

In companies that have an adaptive culture, employees are

A)content to be told what to do during work hours.
B)not motivated to perform beyond minimum requirements.
C)closely supervised within a hierarchical authority.
D)likely to have long-term career paths to follow.

Question 79

Which of the following happens in the conversion stage?

A)anticipating possible problems
B)managing problems as they occur
C)dealing with problems that have arisen
D)managing without correction of problems

Question 80

When an organization has a strong and cohesive organizational culture that controls employee attitudes and behaviors, that company has a(n)________ culture.

A)dynamic
B)bureaucratic
C)adaptive
D)normative