A) Organizational Structure: Chapter 14 Foundations of Organization Structure

Essentials of Organizational Behavior, 10e (Robbins/Judge)
Chapter 14 Foundations of Organization Structure

1) ________ defines how job tasks are formally divided, grouped, and coordinated.
A) Organizational structure
B) Work specialization
C) Departmentalization
D) Organizational behavior
E) Matrix departmentation
Answer: A
Diff: 1
Page Ref: 212
Topic: What Is Organizational Structure?
2) Organizational structure has six key elements. Which of the following is not one of these
elements?
A) centralization
B) departmentalization
C) work specialization
D) formalization
E) location of authority
Answer: E
Diff: 2
Page Ref: 212
3) Consultants Exceptional (CE) has hired you to develop training materials for their consultants.
Your first assignment is to develop a training program that helps their consultants to analyze and
understand the organizational structure of the company that they are assisting. CE believes that in
order to adequately evaluate and understand a client company, consultants need to understand the
basic organizational structure of the company. Consultants are then able to recommend actions
and changes based on the company's structure. One of the questions you tell the trainees to ask
is, "To what degree are tasks subdivided into separate jobs?" This question addresses the issue of
________.
A) formalization
B) work specialization
C) span of control
D) chain of command
E) matrix restructuring
Answer: B
Diff: 2
Page Ref: Exh 14-1
AASCB Tag: Analytic Skills
1
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
4) ________ is addressed by asking the question, "On what basis are jobs grouped together?"
A) Departmentalization
B) Work specialization
C) Centralization and decentralization
D) Formalization
E) Matrix restructuring
Answer: A
Diff: 2
Page Ref: Exh 14-1
5) Consultants Exceptional (CE) has hired you to develop training materials for their consultants.
Your first assignment is to develop a training program that helps their consultants to analyze and
understand the organizational structure of the company that they are assisting. CE believes that in
order to adequately evaluate and understand a client company, consultants need to understand the
basic organizational structure of the company. Consultants are then able to recommend actions
and changes based on the company's structure. You instruct the trainees to ask about the degree
of rules and regulations that direct employees and managers. You want to help them understand
the ________.
A) chain of command
B) degree of formalization
C) span of control
D) degree of departmentalization
E) idea of matrix restructuring
Answer: B
Diff: 2
Page Ref: Exh 14-1
AASCB Tag: Reflective Thinking Skills
6) Work specialization is the same as ________.
A) departmentalization
B) division of labor
C) decentralization
D) job grouping
E) chain command
Answer: B
Diff: 1
Page Ref: 213
2
7) A task that is subdivided into many separate jobs is considered to have a ________.
A) high degree of departmentalization
B) low degree of decentralization
C) high degree of work specialization
D) low degree of structure
E) high degree of matrix structuring
Answer: C
Diff: 2
Page Ref: 213
8) In the late 1940s, most manufacturing jobs in industrialized countries were being done with
high ________.
A) departmentalization
B) decentralization
D) structuralization
E) generalized structure
Answer: C
Diff: 2
Page Ref: 213
9) For much of the first half of the
century, managers viewed work specialization as
________
A) a means to encourage employee satisfaction
B) a frustrating cause of reduced product output
C) an unending source of increased productivity
D) difficult to implement without automation technology
E) an effective solution to over-centralization
Answer: C
Diff: 2
Page Ref: 213
10) You have divided the jobs performed by your department through work specialization and
are now trying to decide how to best group these jobs to improve efficiency and customer
service. You are considering whether to group activities by function, product, process,
geography, or customer. You have decided that since you are a novice at departmentalization, you
will go with the most popular method. You will probably choose ________.
A) function
B) product
C) process
D) customer
E) matrix
Answer: A
Diff: 2
Page Ref: 214
3
11) The basis by which jobs are grouped together is termed ________.
A) social clustering
B) bureaucracy
C) specialization
D) centralization
E) departmentalization
Answer: E
Diff: 1
Page Ref: 214
12) One of the most popular ways to group activities is by ________.
A) product
B) function
C) geography
D) process
E) temporality
Answer: B
Diff: 2
Page Ref: 214
13) Proctor & Gamble departmentalizes by Tide, Pampers, Charmin, and Pringles. This is an
example of departmentalization by ________.
A) function
B) process
C) geography
D) product
E) interest
Answer: D
Diff: 1
Page Ref: 215
14) A plant manager who organizes the plant by separating engineering, accounting,
manufacturing, personnel, and purchasing into departments is practicing ________
departmentalization.
A) target-customer
B) product
C) functional
D) geographic
E) graphic
Answer: C
Diff: 2
Page Ref: 214-215
4
15) ________ departmentalization achieves economies of scale by placing people with common
skills and orientations into common units.
A) Functional
B) Process
C) Product
D) Geographic
E) Temporal
Answer: A
Diff: 2
Page Ref: 214-215
16) Which one of the following is not one of the primary ways to group jobs?
A) skill
B) customer
C) function
D) product
E) process
Answer: A
Diff: 2
Page Ref: 214-215
17) Your company decides to establish southern, Midwestern, western, and eastern zones of
operation. Based on this expansion, you decide to implement ________ departmentalization.
A) area
B) customer
C) geography
D) regional
E) matrix
Answer: C
Diff: 1
Page Ref: 215
18) Your products fall into several categories with very different production methods for each
category. Because of this, you might consider departmentalizing by ________.
A) implementation
B) method
C) production
D) process
E) matrix
Answer: D
Diff: 2
Page Ref: 215
5
19) You discover that your market is clearly divided between very different types of clients, with
different support needs. To respond to this market diversity, you will probably choose to
departmentalize by ________.
A) functional
B) geography
C) support
D) customer
E) matrix
Answer: D
Diff: 1
Page Ref: 215
20) The unbroken line of authority that extends from the top of the organization to the lowest
echelon and clarifies who reports to whom is termed ________.
A) chain of command
B) authority
C) span of control
D) unity of command
E) web of authority
Answer: A
Diff: 2
Page Ref: 216
21) The right inherent in a managerial position to give orders and expect orders to be obeyed is
termed ________.
A) chain of command
B) authority
C) power
D) unity of command
E) leadership
Answer: B
Diff: 2
Page Ref: 216
22) The ________ principle helps preserve the concept of an unbroken line of authority.
A) span-of-control
B) chain-of-command
C) cross-functionality
D) centralization
E) unity-of-command
Answer: E
Diff: 2
Page Ref: 216
6
23) The unity-of-command principle states which of the following?

A) Managers should limit their oversight to a maximum of 12 employees.
B) Managers should oversee 1-4 employees on average.
C) An individual should be directly responsible to only one supervisor.
D) Managers should provide direction to their employees in a unified fashion.
E) Employees should report directly to two supervisors to maintain task balance.
Answer: C
Diff: 2
Page Ref: 216
24) The ________ refers to the number of subordinates that a manager directs.
A) span of control
B) unity of command
C) chain of command
D) decentralization principle
E) leadership web
Answer: A
Diff: 2
Page Ref: 216
25) As employees are being empowered to make decisions previously reserved for management,
which concept of organizational structure has become less relevant?
A) decentralization
B) maintaining the chain of command
C) centalization
D) span of control
Answer: C
Diff: 2
Page Ref: 216
26) If you have a narrow span of control, you have a(n) ________ organization.
A) efficient
B) short
C) tall
D) matrix
E) fat
Answer: C
Diff: 2
Page Ref: 216
7
27) In reorganizing his division, Matthew must make some decisions regarding the span of
control for management within his decision. The question of span of control determines
________.
A) who reports to whom
B) the number of levels and managers an organization has
C) where decisions are made
D) how jobs will be grouped
E) how employees will be compensated
Answer: B
Diff: 2
Page Ref: 216
28) ________ are consistent with recent efforts by companies to reduce costs, cut overhead,
speed up decision making, increase flexibility, get closer to customers, and empower employees.
A) Wider spans of control
B) Narrower spans of control
C) Matrix structures
D) Simple structures
E) Centralization
Answer: A
Diff: 2
Page Ref: 216-217
29) Which of the following is true regarding organizations that establish wide spans of control?
A) At some point, employee performance increases substantially.
B) At some point, supervisors become more efficient at providing support.
C) At some point, wider spans of control reduce effectiveness.
D) At some point, the organization becomes more formalized.
E) At some point, the number of managers in the organization decreases.
Answer: C
Diff: 2
Page Ref: 217
8
30) In observing the departments in his division, Matthew notices that some managers with wide
spans of control seem to perform more effectively than other managers with similarly-sized
spans of control. Which of the following statements is most likely true regarding the highperforming managers?
A) These managers are paid higher salaries than the low-performing managers.
B) These managers discourage employee autonomy, which produces more uniform departmental
results.
C) The employees within their departments tend to compete to reach productivity goals, which
boosts performance.
D) The employees within their departments have poor communication with each other.
E) The employees within their departments are highly skilled and very knowledgeable about
their jobs.
Answer: E
Diff: 3
Page Ref: 217
31) The best definition for centralization is a situation in which decision making ________.
A) is pushed down to lower level employees
B) is concentrated at top management levels in the organization
C) depends on the situation
D) is completed in each department and then sent to the president for review
E) is diffused among a large segment of employees
Answer: E
Diff: 2
Page Ref: 217
32) Which one of the following dichotomies of organizational structure specifically defines
where decisions are made?
A) complexity/simplicity
B) formalization/informalization
C) centralization/decentralization
D) specialization/enlargement
E) affectivity/reflexivity
Answer: C
Diff: 2
Page Ref: 217
33) Which of the following is a drawback of a narrow span of control? It ________.
A) reduces effectiveness
B) is more efficient
C) encourages overly tight supervision and discourages employee autonomy
D) empowers employees
E) increases participatory decision-making
Answer: C
Diff: 3
Page Ref: 216
9
34) Which of the following is not a drawback of a narrow span of control?

A) It is expensive.
B) It makes vertical communication in the organization more complex.
C) Supervisors may lose control of their employees.
D) It encourages overly tight supervision.
E) It discourages employee autonomy.
Answer: C
Diff: 3
Page Ref: 217
35) The trend in recent years has been toward ________.
A) narrower spans of control
B) wider spans of control
C) a span of control of four
D) an ideal span of control of six to eight
E) eliminating spans of control in favor of team structures
Answer: B
Diff: 2
Page Ref: 217
36) In an organization that has high centralization, ________.
A) the corporate headquarters is located centrally to branch offices
B) all top-level officials are located within the same geographic area
C) action can be taken more quickly to solve problems
D) new employees have a great deal of legitimate authority
E) top managers make all the decisions and lower-level managers merely carry out directions
Answer: E
Diff: 2
Page Ref: 217
37) Your trainees are given a case study concerning a local manufacturing firm called Acme
Products. In assessing Acme's organizational structure, your trainees notice that all of the
company's decisions are made by top management, with little or no input from lower-level
personnel. The trainees most likely identify Acme as a(n) ________ organization.
A) decentralized
B) highly formalized
C) aggressively managed
D) highly centralized
E) informally structured
Answer: D
Diff: 3
Page Ref: 217
10
38) Senior management at Acme is concerned because the company takes so long to bring new
products to market. Which of the following approaches would your trainees identify as most
likely to help resolve this problem?
A) reduction of cross-functional work teams
B) decentralization of the decision-making process
C) decreased work specialization
D) decreased formalization of policies and procedures
E) reduced diversity within the company's work force
Answer: B
Diff: 2
Page Ref: 217
39) The more that lower-level personnel provide input or are actually given the discretion to
make decisions, the more ________ there is within an organization.
A) centralization
B) disempowerment
D) departmentalization
E) decentralization
Answer: E
Diff: 2
Page Ref: 217
40) If a job is highly formalized, it would not include which of the following?
A) clearly defined procedures on work processes
B) explicit job description
C) high employee job discretion
D) a large number of organizational rules
E) a consistent and uniform output
Answer: C
Diff: 2
Page Ref: 218
41) Employee discretion is inversely related to ________.
A) complexity
B) standardization
C) specialization
D) departmentalization
E) empowerment
Answer: B
Diff: 2
Page Ref: 218
11
42) Which of the following is not a common organizational design?

A) simple structure
B) bureaucracy
C) centralized structure
D) matrix structure
E) all of the above
Answer: C
Diff: 2
Page Ref: 218
Topic: Common Organizational Designs
43) ________ is characterized by a low degree of departmentalization, wide spans of control,
authority centralized in a single person, and little formalization
A) Bureaucracy
B) Matrix organization
C) Simple structure
D) Team structure
E) Centralized structure
Answer: C
Diff: 2
Page Ref: 219
44) Which one of the following is consistent with a simple structure?
A) high centralization
B) high horizontal differentiation
C) high employee discretion
D) standardization
E) bureaucracy
Answer: A
Diff: 2
Page Ref: 219
45) A ________ is a flat organization.
A) bureaucracy
B) centralized structure
C) matrix structure
D) simple structure
E) virtual organization
Answer: D
Diff: 2
Page Ref: 219
12
46) The simple structure is most widely practiced in small businesses in which ________.
A) the owner also manages the company
B) management is limited to one individual
C) managers have a high degree of influence with the company's owner
D) managers are hired directly by the company's owner
E) training budgets are limited
Answer: A
Diff: 2
Page Ref: 219
47) The strength of the simple structure lies in its ________.
A) efficiency
B) simplicity
C) centralization
D) span of control
E) specialization
Answer: B
Diff: 1
Page Ref: 219
48) Which of the following is not a weakness of the simple structure?
A) It is risky.
B) It is prone to information overload.
C) There is little unity of command.
D) It can lead to slower decision making.
E) It is often insufficient in larger organizations.
Answer: C
Diff: 2
Page Ref: 219
49) You describe a structure that is flat, has little formalization, and is fast, flexible, and
inexpensive to maintain. You are describing the ________.
A) matrix structure
B) simple structure
C) bureaucracy
D) team structure
E) organizational pyramid
Answer: B
Diff: 1
Page Ref: 219
13
50) You assign your students a project that involves developing a business plan for a retail store.
The store will have 200 employees and will serve customers both locally and internationally via
a storefront and an Internet catalogue. Which of the following organizational designs is least
likely to benefit the goals of this retail store?
A) matrix
B) virtual
C) bureaucracy
D) team
E) simple
Answer: E
Diff: 3
Page Ref: 219
51) The key component underlying bureaucracies is ________.
A) flexibility
B) standardization
C) dual lines of authority
D) wide span of control
E) the organizational pyramid
Answer: B
Diff: 1
Page Ref: 219
52) You extol the virtues and benefits of standardization. You are probably promoting the
________.
A) matrix structure
B) simple structure
C) bureaucracy
D) team structure
Answer: C
Diff: 2
Page Ref: 219
53) A bureaucracy is characterized by all of the following EXCEPT ________.
A) highly routine operating tasks
B) formalized rules and regulations
C) tasks that are grouped into functional departments
D) decentralized decision making
E) specialization
Answer: D
Diff: 2
Page Ref: 219
14
54) The structure that combines functional and product departmentalization is the ________.
A) matrix structure
B) simple structure
C) bureaucracy
D) team structure
Answer: A
Diff: 2
Page Ref: 220
55) The matrix structure combines which two forms of departmentalization?
A) process and functional
B) functional and product
C) product and process
D) process and geographic
E) geographic and product
Answer: B
Diff: 2
Page Ref: 220
56) You describe to your students a new committee within the university that brings together
specialists from all different departments to develop a new interdisciplinary program. The
structure probably best meets the definition of the ________.
A) matrix structure
B) expert structure
C) boundaryless structure
D) virtual structure
Answer: A
Diff: 3
Page Ref: 220
57) The structure that creates dual lines of authority is the ________.
A) organizational structure
B) bureaucracy
C) matrix structure
D) virtual organization
E) simple structure
Answer: C
Diff: 2
Page Ref: 220
15
58) The ________ structure violates the unity of command concept.

A) simple
B) virtual
C) matrix
D) team
E) web
Answer: C
Diff: 2
Page Ref: 220
59) Which one of the following problems is most likely to occur in a matrix structure?
A) decreased response to environmental change
B) decreased employee motivation
C) loss of economies of scale
D) increases in groupthink
E) employees receiving conflicting directives
Answer: E
Diff: 2
Page Ref: 220
60) The strength of the matrix structure is its ________.
A) ability to facilitate coordination
B) economies of scale
C) adherence to chain of command
D) standardization
E) social empowerment
Answer: A
Diff: 2
Page Ref: 220
61) A major disadvantage of the matrix structure is ________.
A) the confusion it creates
B) its simplicity
C) its rigid adherence to the unity of command
D) its centralization
E) its rigid role expectations
Answer: A
Diff: 2
Page Ref: 220
16
62) The virtual is also called the ________ or ________ organization.

A) network; modular
B) team; social
C) pyramid; multi-level
D) boundaryless; global
E) simple; unitary
Answer: A
Diff: 2
Page Ref: 221
Topic: New Design Options
63) You have decided to hire other organizations to perform many of the basic functions of your
business. You have hired an accounting firm to keep your records, a recruiting firm to handle
human resource functions, and a computer firm to handle all records. To keep costs down, you
are looking for other areas in which to outsource operations. You have chosen to operate your
business as a ________.
A) matrix organization
B) virtual organization
C) team structure
D) boundaryless structure
Answer: B
Diff: 2
Page Ref: 221-222
64) Your new organization is looking for maximum flexibility. The most appropriate structure is
probably the ________.
C) team structure
D) network structure
Answer: B
Diff: 2
Page Ref: 222
17
65) A small, core organization that outsources major business functions is a ________
organization.
A) team
B) virtual
C) boundaryless
D) matrix
E) simple
Answer: B
Diff: 2
Page Ref: 222
66) The virtual organization stands in sharp contrast to the typical bureaucracy that has many
vertical levels of management and where control is sought through ________.
A) ownership
B) teams
C) imposing limits
D) directives
E) manipulation
Answer: A
Diff: 2
Page Ref: 222
67) The primary drawback of the virtual organization is
A) the reduction in management's control over key parts of its business.
B) the reliance on the founder/manager of the business.
C) the wide spans of control.
D) the long chain of command.
E) the lack of flexibility.
Answer: A
Diff: 2
Page Ref: 223
68) The boundaryless organization relies heavily on ________.
A) information technology
B) efficient chains of command
C) the simple structure
D) the matrix structure
Answer: A
Diff: 2
Page Ref: 223
18
69) You have eliminated horizontal, vertical, and external barriers within your organization. You
are operating as a(n) ________.
C) team structure
D) boundaryless organization
Answer: D
Diff: 2
Page Ref: 223
70) The major advantage of the virtual organization is its ________.
A) control
B) predictability
C) flexibility
D) empowerment
E) complexity
Answer: C
Diff: 2
Page Ref: 223
71) Which organizational design has been called the T-form?
C) team structure
E) bureaucracy
Answer: D
Diff: 2
Page Ref: 223
72) The ________ is a structure characterized by extensive departmentalization, high
formalization, a limited information network, and centralization.
A) mechanistic model
B) organic model
C) traditional model
D) bureaucracy organization
E) simple structure
Answer: A
Diff: 2
Page Ref: 224
Topic: Why Do Structures Differ?
19
73) If there is low formalization, a comprehensive information network, and high participation in
decision making, one would expect a(n) ________ structure.
A) simple
B) mechanistic
C) organic
D) stable
E) matrix
Answer: C
Diff: 2
Page Ref: 224
74) Which of the following is not a determinant of an organization's structure?
A) strategy
B) organization size
C) size of revenues
D) technology
E) environment
Answer: C
Diff: 2
Page Ref: 224
75) All of the following are characteristics of the organic model EXCEPT
A) cross-functional teams
B) narrow spans of control
C) cross-hierarchical teams
D) high participation in decision making
E) flatness
Answer: B
Diff: 2
Page Ref: Exh 14-6
76) Which of the following is NOT a characteristic of the mechanistic model?
A) high specialization
B) free flow of information
C) centralization
D) high formalization
E) narrower spans of control
Answer: B
Diff: 2
Page Ref: Exh 14-6
20
77) A strategy that emphasizes the introduction of major new products and services is a(n)
________ strategy.
A) innovation
B) enhancement
C) progressive
D) organic
E) matrix
Answer: A
Diff: 2
Page Ref: 225
78) A company oriented around cost minimization is best served by which type of structure?
A) virtual
B) combination
C) mechanistic
D) organic
E) targeted
Answer: C
Diff: 2
Page Ref: 225
79) Wal-Mart is an example of a company following a
A) innovation strategy.
B) cost-minimization strategy.
C) imitation strategy.
D) branding strategy.
E) differentiation strategy.
Answer: B
Diff: 1
Page Ref: 225
80) ________ refers to how an organization transfers its inputs into outputs.
A) Production
B) Technology
C) Operations
D) Process
E) Effectiveness
Answer: B
Diff: 3
Page Ref: 225
21
81) Which of the following is not part of an organization's environment?

A) public pressure groups
B) customers
C) employees
D) competitors
E) government regulatory agencies
Answer: C
Diff: 2
Page Ref: 225
82) Which of the following does not reflect a dynamic environment?
A) new competitors
B) difficulties in acquiring raw materials
C) rapidly changing government regulations affecting business
D) no new technological breakthroughs by current competitors
E) continually changing produce preferences by customers
Answer: D
Diff: 3
Page Ref: 226
83) Which of the following generalizations about organizational structures and employee
performance and satisfaction is most accurate?
A) There is fairly strong evidence linking decentralization and job satisfaction.
B) No evidence supports a relationship between span of control and employee performance.
C) The evidence generally indicates that work specialization contributes to lower employee
productivity.
D) Employees dislike routine work that makes minimal intellectual demands.
E) Large spans of control provide more distant supervision, thereby increasing employee
productivity.
Answer: B
Diff: 3
Page Ref: 227
Topic: Organizational Designs and Employee Behavior
84) Which organizational structure still dominates in many parts of Europe and Asia?
A) simple structure
B) bureaucracy
C) virtual organization
E) matrix
Answer: B
Diff: 3
Page Ref: 228
Topic: Global Implications
AASCB Tag: Multicultural and Diversity Understanding
22
85) Managers need to address six key elements when they design their organization's structure:
work specialization, departmentalization, chain of command, chain of control, centralization and
decentralization, and formalization.
Answer: FALSE
Diff: 2
Page Ref: 212
86) The degree to which tasks in the organization are subdivided into separate jobs is termed
departmentalization.
Answer: FALSE
Diff: 2
Page Ref: Exh 14-1
87) Specialization defines how job tasks are formally defined, grouped, and coordinated.
Answer: FALSE
Diff: 2
Page Ref: 213
88) Work specialization may result in employee boredom, stress, and absenteeism.
Answer: TRUE
Diff: 1
Page Ref: 213
89) For much of the first half of this century, managers viewed departmentalization as promoting
increased productivity.
Answer: FALSE
Diff: 2
Page Ref: 213
90) The strength of functional departmentalization lies in the efficiencies obtained by putting
similar specialists together.
Answer: TRUE
Diff: 2
Page Ref: 215
91) Only one form of departmentalization can effectively be implemented in an organization at a
time.
Answer: FALSE
Diff: 2
Page Ref: 215
92) The inherent right in a managerial position to give orders and expect the orders to be obeyed
is termed power.
Answer: FALSE
Diff: 2
Page Ref: 216
23
93) Departmentalization answers questions for employee such as "To whom do I go if I have a
problem?"
Answer: FALSE
Diff: 2
Page Ref: 216
94) The unbroken line of authority that extends from the top of the organization to the lowest
echelon is termed the command line of authority.
Answer: FALSE
Diff: 1
Page Ref: 216
95) The principle of unity of command suggests that managers should support one another.
Answer: FALSE
Diff: 1
Page Ref: 216
96) Span of command determines the number of levels and managers an organization has.
Answer: FALSE
Diff: 2
Page Ref: 216
97) All things being equal, the wider or larger the span of control, the more profitable the
organization.
Answer: FALSE
Diff: 3
Page Ref: 216
98) Flat organizational structures result from narrow spans of control.
Answer: FALSE
Diff: 3
Page Ref: 216
99) Narrow spans of control can result in lack of supervision, causing performance to suffer.
Answer: FALSE
Diff: 2
Page Ref: 216
100) Having too many people report to you can undermine your effectiveness as a manager.
Answer: TRUE
Diff: 1
Page Ref: 216
101) The trend in recent years has been toward wider spans of control.
Answer: TRUE
Diff: 1
Page Ref: 217
24
102) The more that lower-level personnel provide input or are actually given the discretion to
make decisions, the more decentralized the organization.
Answer: TRUE
Diff: 2
Page Ref: 217
103) A decentralized organization is more likely to result in a feeling of alienation by employees
than a centralized organization.
Answer: FALSE
Diff: 3
Page Ref: 218
104) There has been a marked trend toward centralization in business decision making.
Answer: FALSE
Diff: 2
Page Ref: 218
105) An increase in the number of rules and regulations results in increased formalization.
Answer: TRUE
Diff: 1
Page Ref: 218
106) The greater the formalization of an organization, the more input an employee has into how
his or her work is done.
Answer: FALSE
Diff: 3
Page Ref: 218
107) Autonomy and formalization are positively related.
Answer: FALSE
Diff: 2
Page Ref: 218
108) The simple structure is flexible and inexpensive to maintain, but its chain of command is
often ambiguous.
Answer: FALSE
Diff: 2
Page Ref: 219
109) A major strength of the simple structure is that it easily adapts to any size organization.
Answer: FALSE
Diff: 2
Page Ref: 219
25
110) One disadvantage of the simple structure is its high risk.

Answer: TRUE
Diff: 3
Page Ref: 219
111) The strength of the bureaucracy lies in its ability to perform standardized activities.
Answer: TRUE
Diff: 2
Page Ref: 219
112) A major weakness of the bureaucracy is that specialization creates sub-unit conflicts.
Answer: TRUE
Diff: 2
Page Ref: 219
113) The bureaucracy is efficient only as long as employees confront problems brought about by
programmed decision rules.
Answer: TRUE
Diff: 1
Page Ref: 220
114) The matrix structure is characterized by highly routine operating tasks achieved through
specialization.
Answer: FALSE
Diff: 2
Page Ref: 220
115) A structure that creates dual lines of authority and combines functional and product
departmentalization is the matrix structure.
Answer: TRUE
Diff: 1
Page Ref: 220
116) The matrix structure facilitates the allocation of specialists.
Answer: TRUE
Diff: 3
Page Ref: 220
117) The major disadvantage of the matrix is the propensity for functional unit goals to override
organizational goals.
Answer: FALSE
Diff: 3
Page Ref: 221
26
118) You have decided to hire a small shop to do all of your duplicating and printing. This is an
example of outsourcing.
Answer: TRUE
Diff: 2
Page Ref: 221
119) The matrix organization is also called the network or modular organization.
Answer: FALSE
Diff: 3
Page Ref: 221
120) The virtual organization is effective at reinforcing management control over business
operations.
Answer: FALSE
Diff: 2
Page Ref: 222
121) The major advantage to the virtual organization is its flexibility.
Answer: TRUE
Diff: 1
Page Ref: 223
122) An organization that seeks to eliminate the chain of command is a boundaryless
organization.
Answer: TRUE
Diff: 1
Page Ref: 223
123) Status and rank are minimized in the boundaryless organization.
Answer: TRUE
Diff: 2
Page Ref: 223
124) Globalization serves to reinforce external boundaries within organizations.
Answer: FALSE
Diff: 3
Page Ref: 223
125) The technological thread that makes the boundaryless organization possible is wireless
communications.
Answer: FALSE
Diff: 2
Page Ref: 223
AASCB Tag: Use of Information Technology
27
126) An organic model of structure is characterized by extensive departmentalization, high

formalization, a limited information network, and centralization.
Answer: FALSE
Diff: 1
Page Ref: 224
127) The boundaryless organization is an example of the organic model of organizational design.
Answer: TRUE
Diff: 1
Page Ref: 224
128) Mechanistic structures are high in formalization.
Answer: TRUE
Diff: 1
Page Ref: 224
129) Businesses structured according to the mechanistic model usually have high employee
participation in decision making.
Answer: FALSE
Diff: 2
Page Ref: 224
130) An organization's business strategy is usually determined by the organization's business
structure.
Answer: FALSE
Diff: 1
Page Ref: 224
131) An innovation strategy works well only for businesses organized within a simple structure.
Answer: FALSE
Diff: 2
Page Ref: 225
132) Businesses using innovation strategy seek to quickly move into new markets after the
viability of those markets has been proven.
Answer: FALSE
Diff: 2
Page Ref: 225
133) An organization pursues a price-minimization strategy by controlling costs, avoiding
unnecessary innovation or marketing expenses, and cutting prices in selling basic products.
Answer: FALSE
Diff: 2
Page Ref: 225
28
134) The size of an organization affects the organization's structure at a decreasing rate of
impact.
Answer: TRUE
Diff: 3
Page Ref: 225
135) Adding 500 employees to an organization that has only 300 members is likely to result in a
shift toward a more organic structure.
Answer: FALSE
Diff: 3
Page Ref: 225
136) Technology is associated with how an organization transfers its inputs into outputs.
Answer: TRUE
Diff: 2
Page Ref: 225
137) Organizations operating in highly scarce, dynamic, and complex environments fare best if
under organic structures.
Answer: TRUE
Diff: 3
Page Ref: 226
138) Organizational structure has little bearing on employee attitudes and behavior.
Answer: FALSE
Diff: 1
Page Ref: 226
139) Research supports the notion that employees prefer organic business structures.
Answer: FALSE
Diff: 2
Page Ref: 226-227
140) Organizations that are less centralized have greater employee input in business decision
making.
Answer: TRUE
Diff: 1
Page Ref: 227
141) What is organizational structure?
Answer: An organizational structure defines how job tasks are formally divided, grouped, and
coordinated. The elements that must be addressed are work specialization, departmentalization,
chain of command, span of control, centralization and decentralization, and formalization.
Page Ref: 212
29
142) Explain the organizational component of work specialization. Discuss its advantages and
drawbacks.
Answer: The essence of work specialization is that, rather than an entire job being done by one
individual, it is broken down into a number of steps, with each step being completed by a
separate individual. In essence, individuals specialize in doing part of an activity rather than the
entire activity. Management saw this as a means to make the most efficient use of its employees'
skills. In most organizations, some tasks require highly developed skills and others can be
performed by untrained workers. If all workers were engaged in each step of, say, an
organization's manufacturing process, all would have to have the skills necessary to perform both
the most demanding and the least demanding jobs. The result would be that, except when
performing the most skilled or highly complex tasks, employees would be working below their
skill levels. And because skilled workers are paid more than unskilled workers and their wages
tend to reflect their highest level of skill, it represents an inefficient use of organizational
resources to pay highly skilled workers to do easy tasks.
Managers also saw other efficiencies that could be achieved through work specialization.
Employee skills at performing a task successfully increase through repetition. Less time is spent
in changing tasks, in putting away one's tools and equipment from a prior step in the work
process, and in getting ready for another. Equally important, training for specialization is more
efficient from the organization's perspective. It's easier and less costly to find and train workers
to do specific and repetitive tasks.
For much of the first half of the twentieth century, managers viewed work specialization as an
unending source of increased productivity. And they were probably right. Because specialization
was not widely practiced, its introduction almost always generated higher productivity. But by
the 1960s, there came increasing evidence that a good thing can be carried too far. The point had
been reached in some jobs at which the human diseconomies from specializationwhich
surfaced as boredom, fatigue, stress, low productivity, poor quality, increased absenteeism, and
high turnovermore than offset the economic advantages.
Most managers today see work specialization as neither obsolete nor an unending source of
increased productivity. Rather, managers recognize the economies it provides in certain types of
jobs and the problems it creates when it's carried too far.
Page Ref: 213-214
30
143) What is departmentalization? What are five common ways that an organization can group
activities? Give an example of each.
Answer: The basis by which jobs are grouped together is called departmentalization. Tasks can
be grouped by function performed, the type of product the organization produces, on the basis of
geography or territory, process used, or by the particular type of customer the organization seeks
to reach. One of the most popular ways to group activities is by functions performed. A
manufacturing manager might organize his or her plant by separating engineering, accounting,
manufacturing, personnel, and supply specialists into common departments. Tasks can also be
departmentalized by type of product the organization produces. Procter & Gamble is organized
along these lines. Each major product is placed under the authority of an executive who has
complete global responsibility for that product. Another way to departmentalize is on the basis of
geography or territory. The sales function, for instance, may have western, southern, midwestern, and eastern regions. Each of these regions is, in effect, a department organized around
geography. Process departmentalization can be used to group departments. At an Alcoa
aluminum tubing plant in upstate New York, production is organized into five departments:
casting; press; tubing; finishing; and inspecting, packing, and shipping. Each department
specializes in one specific phase in the production of aluminum tubing. A final category is to use
the particular type of customer the organization seeks to reach. Microsoft recently reorganized
around four customer markets: consumers, large corporations, software developers, and small
businesses.
Page Ref: 214-215
144) What is the chain of command within an organization?
Answer: The chain of command is an unbroken line of authority that extends from the top of the
organization to the lowest echelon and clarifies who reports to whom. It answers questions for
employees such as "To whom do I go if I have a problem?" and "To whom am I responsible?"
The two complementary concepts are authority and unity of command. Authority refers to the
rights inherent in a managerial position to give orders and expect the orders to be obeyed. The
unity of command principle helps preserve the concept of an unbroken line of authority. It states
that a person should have one and only one superior to whom he or she is directly responsible.
Page Ref: 215-216
145) Why is span of control important within an organization?
Answer: The question of span of control is important because, to a large degree, it determines
the number of levels and managers an organization has. It answers the question "How many
employees can a manager efficiently and effectively direct?" All things being equal, the wider or
larger the span of control, the more efficient the organization.
Page Ref: 216
31
146) What is the difference between centralization and decentralization?

Answer: The term centralization refers to the degree to which decision making is concentrated at
a single point in the organization. The concept includes only formal authority, that is, the rights
inherent in one's position. The more that lower-level personnel provide input or are actually
given the discretion to make decisions, the more decentralization there is. An organization
characterized by centralization is an inherently different structural animal from one that is
decentralized. In a decentralized organization, action can be taken more quickly to solve
problems, more people provide input into decisions, and employees are less likely to feel
alienated from those who make the decisions that affect their work lives.
Page Ref: 217-219
147) Describe the three common organizational designs: simple structure, bureaucracy, and
matrix structure.
Answer: The simple structure is said to be characterized most by what it is not rather than what
it is. The simple structure is not elaborate. It has a low degree of departmentalization, wide spans
of control, authority centralized in a single person, and little formalization. The simple structure
is a "flat" organization; it usually has only two or three vertical levels, a loose body of
employees, and one individual in whom the decision-making authority is centralized.
Standardization is the key concept that underlies the bureaucracy. It is characterized by highly
routine operating tasks achieved through specialization, very formalized rules and regulations,
tasks that are grouped into functional departments, centralized authority, narrow spans of control,
and decision making that follows the chain of command. The matrix combines two forms of
departmentalization: functional and product. It breaks the unity-of-command concept.
Employees in the matrix have two bossestheir functional department managers and their
product managers. Therefore, the matrix has a dual chain of command.
Page Ref: 218-221
148) Explain the virtual organization and the boundaryless organization.
Answer: The virtual organization is sometimes called the network or modular organization.
Typically, a small, core organization outsources major business functions. In structural terms, the
virtual organization is highly centralized, with little or no departmentalization. Why own when
you can rent is the question that captures the essence of the virtual organization. Jack Welch
coined the term boundaryless organization to describe his idea of what he wanted GE to become.
He wanted to eliminate vertical and horizontal boundaries within GE and break down external
barriers between the company and its customers and suppliers. The boundaryless organization
seeks to eliminate the chain of command, have limitless spans of control, and replace
departments with empowered teams. Because it relies so heavily on information technology,
some have called this structure the T-form or technology-based organization. By removing
vertical boundaries, management flattens the hierarchy. Status and rank are minimized.
Page Ref: 221-222
32
149) What is the difference between the mechanistic model and the organic model of
organizational structure?
Answer: The mechanistic model is generally synonymous with the bureaucracy in that it has
extensive departmentalization, high formalization, a limited information network (mostly
downward communication), and little participation by low-level members in decision making. At
the other extreme is the organic model. This model looks a lot like the boundaryless
organization. It is flat, uses cross-hierarchical and cross-functional teams, has low formalization,
possesses a comprehensive information network and it involves high participation in decision
making.
Page Ref: 224 and Exh14-6
150) Explain the implications of different organizational designs for employee behavior.
Answer: A review of the evidence linking organizational structures to employee performance
and satisfaction leads to a pretty clear conclusion you can't generalize. Not everyone prefers the
freedom and flexibility of organic structures. Individual differences must be addressed. The
evidence generally indicates that work specialization contributes to higher productivity but at the
price of reduced job satisfaction. Work specialization is not an unending source of higher
productivity. Problems start to surface, and productivity begins to suffer, when the human
diseconomies of doing repetitive and narrow tasks overtake the economies of specialization. As
the workforce has become more highly educated and desirous of jobs that are intrinsically
rewarding, the point where productivity begins to decline seems to be reached more quickly than
in decades past. Negative behavioral outcomes from high specialization are most likely to
surface in professional jobs occupied by individuals with high needs for personal growth and
diversity.
A review of the research indicates that it is probably safe to say there is no evidence to support a
relationship between span of control and employee performance. There is some evidence
indicating that a manager's job satisfaction increases as the number of employees he or she
supervises increases.
Fairly strong evidence has linked centralization and job satisfaction. In general, organizations
that are less centralized have a greater amount of participative decision making. Participative
decision making is positively related to job satisfaction. But, again, individual differences
surface. The decentralization-satisfaction relationship is strongest with employees who have low
self-esteem. Because individuals with low self-esteem have less confidence in their abilities, they
place a higher value on shared decision making, which means that they're not held solely
responsible for decision outcomes. To maximize employee performance and satisfaction,
individual differences, such as experience, personality, and the work tasks, should be taken into
account.
Page Ref: 226-227
33

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A) Organizational Structure: Chapter 14 Foundations of Organization Structure

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Essentials of Organizational Behavior, 10e (Robbins/Judge)

Chapter 14 Foundations of Organization Structure

23) The unity-of-command principle states which of the following?

34) Which of the following is not a drawback of a narrow span of control?

42) Which of the following is not a common organizational design?

58) The ________ structure violates the unity of command concept.

62) The virtual is also called the or organization.

81) Which of the following is not part of an organization's environment?

110) One disadvantage of the simple structure is its high risk.

126) An organic model of structure is characterized by extensive departmentalization, high

146) What is the difference between centralization and decentralization?

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