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Chapter 19

Organizational Buyer Behavior

Multiple Choice Questions


1. Marketers have learned which of the following with respect to segmenting business customers?

A. The segment of small and moderate-sized businesses has a lot of potential.


B. The segment of small and moderate-sized businesses has limited potential.
C.

The segment of large businesses is the most attractive.

D.

The segment of large businesses is the least attractive.

E. Tapping the potential of the small and moderate-sized business segment does not require
adapting the marketing strategy from that used to target larger businesses.
2. Which of the following is FALSE regarding what drives businesses?

A.
B.

Small and moderate sized businesses have a lot of potential.


Branding doesn't matter.

C.

Personal relationships matter.

D.

Businesses are consumers.

E.

None of the above is false.

3. Which of the following influences organizational culture and thus, organizational buyer behavior?

A.

culture

B.

marketing activities

C.

organizational values

D.
E.

motives
all of the above

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4. Which of the following is an external influence on organizational buyer behavior?

A.

organizational values

B.

motives

C.
D.
E.

emotions
reference groups
learning

5. Which of the following is NOT an external influence on organization buyer behavior?

A.
B.

firmographics
culture

C.

perception

D.

government

E.

marketing activities

6. Carlos is trying to understand the organizational buyer behavior of firms in his sales territory.
Which of the following is an external influence on an organization's culture that he should
examine?

A.

organizational values

B.
C.
D.
E.

needs
desires
firmographics
motives

7. Firmographics, culture, government, reference groups, and marketing activities are _____
influences on organizational buyer behavior.

A.
B.
C.
D.
E.

internal
external
insignificant
primary
secondary

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8. Matt is currently undergoing sales training and is trying to understand the external influences on
organizational buyer behavior. Which of the following is an external influence?

A.
B.
C.

firmographics
culture
government

D.

marketing activities

E.

all of the above

9. Which of the following is an internal influence on organizational buyer behavior?

A.
B.
C.

motives
firmographics
culture

D.

reference groups

E.

all of the above

10. Which of the following is NOT an internal influence on organizational buyer behavior?

A.
B.
C.
D.
E.

firmographics
organizational values
perception
motives
memory

11. Maria is a pharmaceutical sales representative who calls on hospitals. She is taking on a new
territory, and she is trying to learn the internal influences on each hospital's culture. Which of the
following is something that she should consider with respect to internal influences?

A.

firmographics

B.

organizational values

C.

reference groups

D.
E.

lead users
competitors' marketing activity

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12. Which of the following is a stage in the organizational decision process?

A.

problem recognition

B.

information search

C.
D.
E.

alternative evaluation
outlet selection and purchase
all of the above

13. Which of the following is NOT a stage in the organizational buying decision process?

A.

vendor support programs

B.

problem recognition

C.

information search

D.
E.

postpurchase processes
alternative evaluation and selection

14. Problem recognition, information search, alternative evaluation and selection, outlet selection and
purchase, and postpurchase processes represent _____.

A.

external influences

B.

internal influences

C.

organizational culture

D.
E.

the decision process


types of buying decisions

15. Different functional areas of an organization often do all of the following EXCEPT _____.

A.
B.
C.
D.
E.

play different roles in the purchase process


utilize different information sources
use different evaluative criteria
assign different weights to evaluative criteria
All of the above are done by different functional areas.

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16. The individuals (representing functional areas and management) within an organization who
participate in making a given purchase decision make up the _____.

A.

strategic business unit (SBU)

B.

decision center (DC)

C.

decision-making unit (DMU)

D.

strategic decision unit (SDU)

E.

functional decision unit (FDU)

17. Sinclair is from accounting and is a member of a committee to purchase a new mainframe
computer system for his company. Sinclair is a member of the _____.

A.

strategic business unit (SBU)

B.

decision center (DC)

C.

decision-making unit (DMU)

D.

strategic decision unit (SDU)

E.

functional decision unit (FDU)

18. Decision-making units often function as _____ when they consist of individuals from various
areas of the firm, such as accounting, engineering, manufacturing, and marketing, who meet
specifically to make a purchase decision.

A.

buying centers

B.

purchasing agents

C.

consultants

D.

intermediaries

E.

opinion leaders

19. Which of the following is a characteristic of a decision-making unit?

A.

They are often relatively permanent for nonroutine decisions.

B. Even less important decisions are likely to involve individuals from a wide variety of functional
areas.
C. Large, highly structured organizations ordinarily involve more individuals in a purchase decision
than do small, less formal organizations.
D. Decision-making units are typically a separate permanent organizational department in large
organizations.
E. Small organizations do not use formalized decision-making units.

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20. A difference between large and small organizations when making a purchase decision is _____.

A. small organizations generally involve more individuals in the decision-making process


B. large organizations generally involve more individuals in the decision-making process
C.

large organizations typically have less specialization

D. small organizations typically have more specialized purchasing tools


E.

all of the above

21. Members of the decision-making unit play which of the following roles?

A.

information gatherer

B.

key influencer

C.

decision maker

D.
E.

purchaser
all of the above

22. Which of the following is NOT a role played by members of the decision-making unit?

A.
B.
C.

information gatherer
key influencer
regulator

D.
E.

user
purchaser

23. For which stage of the product life cycle is the size of the decision-making unit typically large?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

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24. Bob is an engineer. For which stage of the product life cycle is he likely to be a member of a key
function influencing purchase decisions?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

25. For products in which stage of the product life cycle are engineering and R&D likely to be key
functions influencing the purchase decision?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

26. For which stage of the product life cycle is the size of the decision-making unit likely to be neither
small nor large, but medium?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

27. For which stage of the product life cycle is the decision-making unit likely to be small?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

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28. For products in which stage of the product life cycle is the purchasing function of an organization
likely to be the key function influencing the purchase decision?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

29. Madeline works in purchasing for a major corporation. For purchase of products, in which stage of
the product life cycle is she likely to perform a key function influencing purchase decisions?

A.
B.
C.
D.
E.

introduction
growth
maturity
decline
fortification

30. Which of the following is an organizational purchase situation?

A.
B.
C.

nominal
modified rebuy
limited

D.

extended

E.

routine

31. Which type of organizational purchase situation occurs when the purchase is of minor importance
and is not complex?

A.
B.
C.
D.
E.

nominal
modified rebuy
limited
straight rebuy
routine

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32. Which type of organizational purchase situation is characterized by low purchase importance, low
choice complexity, level of decision-making unit (DMU) at low levels of the organization, a very
small DMU, very brief time to decision, and very limited decision search?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.

limited

33. Which type of organizational purchase situation is characterized by high purchase importance
and complexity, a large and evolving decision-making unit that includes the top of the
organization, a long time to decision, extensive information search and analysis techniques, and a
dominant strategic focus?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.

limited

34. Juan's job as a purchasing agent consists mostly of reordering basic supplies and component
parts. Which type of organizational purchase situation does this represent?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.

limited

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35. The College of Business at a major university is considering the purchase of technology
necessary to enable them to put their curriculum online. This decision is very important and
includes a very large and evolving decision-making unit. Which type of organizational purchase
situation does this represent?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.

limited

36. In high-tech markets, who is most likely to recognize a problem or need to purchase?

A.

CEO

B.

accounting personnel

C.

purchasing manager

D.

head of a department

E.

consumer

37. Which of the following can possibly be part of the informal information search process for
organizational buyers?

A.

site visits to evaluate a potential vendor

B.

laboratory test of a new product or prototype

C.

investigation of possible product specifications

D.
E.

discussions with sales representatives


All of the above are part of informal information search.

38. Darryl is a chemist at a pharmaceutical company, and he was asked by the decision-making unit
at his company to visit and evaluate potential vendors that will supply his company with the
chemicals required to manufacture their products and to conduct laboratory tests of a new
product that can be used in the manufacture of their products. Darryl is assisting the company
with which type of information search?

A.
B.
C.
D.
E.

formal
informal
priority
secondary
direct

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39. Shawn tries to obtain information that might assist his company whenever he talks with sales
representatives, attends trade shows, or when he reads the journals related to his industry.
Shawn is conducting a(n) _____.

A.

formal information search

B.

informal information search

C.

direct information search

D.

indirect information search

E.

secondary information search

40. Which type of decision rule is very common in the first step of a two-stage decision for an
organizational purchase?

A.

conjunctive

B.

disjunctive

C.

lexicographic

D.

compensatory

E.

elimination-by-aspects

41. Marcus works in operations. Which of the following evaluative criteria is NOT important to him?

A.

ease of maintenance of equipment

B.

competence of service technicians

C.
D.
E.

vendor offers a broad line


time needed to install equipment
product warranty

42. Payments, warranties, delivery dates, and so forth represent _____.

A.

purchase specifications

B.

product specifications

C.

terms and conditions

D.

postpurchase evaluation

E.

relationship marketing

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43. Laura's job is to negotiate the payment schedule, warranties, and delivery dates for major
purchases made by her company. Laura deals with the _____ of the purchase.

A.

evaluative criteria

B.

product specifications

C.

terms and conditions

D.

postpurchase evaluation

E.

relationship marketing aspect

44. Which of the following sources is rated as the most important information source for purchasers
and purchase influencers within organizations?

A.

online database services

B.

B2B magazines

C.
D.
E.

salespeople
television business networks
general business press

45. Given the informational role of the web in today's B2B environment, salespeople need to _____.

A.

adopt the role of solution provider

B.

adopt the role of information provider

C.

replace the use of search engines

D.
E.

redesign corporate websites


all of the above

46. The beliefs and attitudes an organization's members have about the organization and how it
operates is known as _____.

A.
B.
C.

policy and procedure


firmographics
lifestyle

D.

organizational style

E.

organizational culture

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47. Organizations have a type of self-concept and lifestyle that the text refers to as _____.

A.

organizational ethos

B.

organizational culture

C.

organizational demeanor

D.

organizations structure

E.

none of the above

48. Which term is often used to refer to the organizational culture of a business firm?

A.
B.

firmographics
lifestyle

C.

corporate culture

D.

corporate style

E.

internal style

49. _____ involve both organization characteristics (e.g., size, activities, and location) and
characteristics of the composition of the organization (e.g., gender, age, education).

A.

Firmographics

B.

Psychographics

C.

Demographics

D.
E.

Geographics
Behaviorgraphics

50. Which of the following variables represents an organization's firmographics?

A.

size

B.

activities and objectives

C.

location

D.

industry category

E.

all of the above

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51. Which of the following is NOT a component of firmographics?

A.

company size

B.

reference groups

C.

company objective

D.

company location

E.

All of the above are components of firmographics.

52. Which of the following statements is FALSE regarding a firm's size?

A. Large organizations are more likely than smaller ones to have a variety of specialists who
attend to purchasing, finance, marketing, and general management.
B. The same promotional message needs to be targeted to all of the various functions in the firm.
C. Larger organizations are generally more complex than smaller ones because more individuals
participate in managing the organization's operations.
D. The purchase decision in a smaller firm might involve only the owner or manager.
E. One message would need to address all the key purchase issues when targeting a smaller
firm.
53. Organizational objectives can be categorized as _____.

A.
B.

commercial
governmental

C.

nonprofit

D.

cooperative

E.

all of the above

54. Which of the following is NOT a category of organizational objectives?

A.
B.

commercial
governmental

C.

nonprofit

D.

cooperative

E.

temporal

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55. Organizational activities can be categorized as _____.

A.

routine

B.

complex

C.

technical

D.
E.

A and B
A, B, and C

56. The American Red Cross participates in fund-raising activities all throughout the year. How would
this be classified with respect to general organizational objectives and the nature of the
organizational activity?

A.

commercial objective, routine activity

B.

governmental objective, routine activity

C.

nonprofit objective, routine activity

D.

cooperative objective, routine activity

E.

nonprofit objective, complex activity

57. General Electric commits millions of dollars a year to research and development to develop new
products. How would this be classified with respect to general organizational objectives and the
nature of the organizational activity?

A.

commercial objective, routine activity

B.

commercial objective, complex activity

C.

commercial objective, technical activity

D.

cooperative objective, technical activity

E.

nonprofit objective, complex activity

58. A commercial firm in which stock is widely traded is known as a(n) _____.

A.

public firm

B.

cooperative firm

C.

private firm

D.
E.

open firm
trade firm

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59. Roger owns 200 shares of stock in Home Depot. Which type of commercial firm is Home Depot?

A.

public firm

B.

cooperative firm

C.

private firm

D.
E.

open firm
trade firm

60. A commercial firm in which one or a few individuals owns a controlling share of the firm is known
as a(n) _____.

A.

public firm

B.

cooperative firm

C.

private firm

D.
E.

open firm
nontrade firm

61. Robert Mondavi is a well-known winery in Napa Valley, CA. It is a family-owned business and is
not traded on any stock exchange. Which type of commercial firm is this known as?

A.

public firm

B.

cooperative firm

C.

private firm

D.
E.

open firm
nontrade firm

62. Which of the following is NOT an objective uncovered through research that drives the
management of privately held firms?

A.
B.
C.
D.
E.

building a place for the entire family to work and be involved


becoming wealthy
avoiding corporations and working for others
building a lasting "empire"
changing governmental regulations

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63. The types of individuals who work in the organization represent the organization's _____.

A.
B.

size
composition

C.

macrosegment

D.

reference group

E.

demographic group

64. The culture of most organizations is influenced most heavily by which of the following?

A.

government

B.

overall membership

C.

founder and top management

D.

competition

E.

customers

65. Organizations with distinguishing firmographics can be grouped into market segments through a
process called _____.

A.

industry identification

B.

infrastructure segmentation

C.

conjoint analysis

D.

macrosegmentation

E.

factor analysis

66. Which of the following statements regarding culture and government is TRUE?

A. Variations in values and behaviors across cultures affect organizations as well as individuals.
B. In Europe, bribery and similar approaches for making sales are acceptable.
C. In the United States, there is a close working relationship between businesses and
government.
D. Worker welfare is more important than corporate profit in most U.S. companies.
E. Plant closure laws, layoff regulations, and worker benefits tend to be much higher in the United
States than in European countries.

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67. Perhaps the most powerful type of reference group in industrial markets is that of _____.

A.

innovators

B.

lead users

C.

government regulators

D.

market mavens

E.

business press

68. Innovative organizations that derive a great deal of their success from leading change are referred
to as _____.

A.

innovators

B.

lead users

C.
D.
E.

government regulators
market mavens
opinion leaders

69. Which of the following is NOT considered a user reference group in organizational buying?

A.
B.
C.
D.
E.

lead user
trade press
early adopters
followers
All of the above are considered a user reference group.

70. Microsoft is a company that has derived a great deal of success from leading change, and other
computer-related companies look to Microsoft for cues as to where technology will be heading in
the future. Microsoft would be classified as which type of user reference group?

A.

lead user

B.

industry leader

C.

early adopters

D.
E.

followers
supportive firm

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71. Lead users tend to accelerate market adoption, which is labeled as _____.

A.

market pull

B.

primary demand

C.

market push

D.

secondary demand

E.

leading indicator

72. Which of the following is an infrastructure reference group?

A.

business press

B.

followers

C.

early adopters

D.

lead firms

E.

government regulators

73. _____ refers to the flow of purchase influence within an industry.

A.

User reference groups

B.

Reference group infrastructure

C.

Diffusion of innovations

D.

Two-stage decision process

E.

Buying centers

74. Which of the following can influence an organization's decision to buy or not buy a given product,
or to buy or not buy from a given supplier?

A.

trade associations

B.

financial analysts

C.

dealer organizations

D.

business press

E.

all of the above

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75. Lead users tend to accelerate diffusion of information through infrastructure, which is labeled as
_____.

A.

market pull

B.

primary demand

C.

market push

D.

secondary demand

E.

leading indicator

76. Which of the following is a value representative of an innovative organization that seeks to
change, views problems as opportunities, and rewards individual efforts?

A.
B.

Risk taking is discouraged.


Cooperation is more important than competition.

C.

Change is negative and actively avoided.

D.

Hard work comes first, leisure second.

E.

Rank or status is more important than performance.

77. Which of the following is the MOST important element of the communications mix in most
industrial markets?

A.
B.
C.
D.
E.

advertising
sales promotion
sales calls
public relations
pricing

78. For which type of industry are average costs per sales call the highest?

A.
B.

manufacturing
service

C.
D.
E.

retail
wholesale distribution
nonprofit

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79. Which of the following is a reason for the significant role of salespeople in industrial markets?

A. It is the least expensive form of communication for the selling organization.


B. Business buyers prefer to do business with firms they know, like, and trust, and sales
personnel are the most common representative of the selling organization.
C. Advertising has been shown to not have any positive impact on awareness and sales.
D. Business buyers usually are not allowed to purchase without the assistance of a sales
representative.
E.

None of the above is a reason.

80. Which organization buyer segment doesn't want value-added service and doesn't want to pay for
it?

A.

commodity buyers

B.

underperforming buyers

C.

partner buyers

D.

most-valuable buyers

E.

government buyers

81. Which organizational buyer segment is expensive to serve, but loyal and willing to pay for valueadded services?

A.

commodity buyers

B.

underperforming buyers

C.

partner buyers

D.

most-valuable buyers

E.

government buyers

82. Which form of organizational buyer exchange involves single transactions, is short lived, involves
few involvements by the buyer and seller in the relationship, and involves low loyalty?

A.

relational

B.

transactional

C.

procurement

D.
E.

transient
temporary

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83. Which form of organizational buyer exchange involves multiple events, occurs over an extended
period of time, and involves higher levels of loyalty?

A.

relational

B.

transactional

C.

procurement

D.

transient

E.

temporary

True / False Questions


84. Various factors beyond functional utility influence organizational decisions.
True

False

85. Buying units (BU) are the individuals within an organization who participate in making a given
purchase decision.
True

False

86. Individual power and expertise have virtually no influence on organizational decisions because it
is a group process involving DMUs.
True

False

87. Decision-making units are likely to vary over the product life cycle.
True

False

88. Organizational purchase situations are known as straight rebuy, modified rebuy, and new task.
True

False

89. Limited rebuy is the approach used in an organizational buying situation when the purchase is
moderately important to the firm or the choice is somewhat complex.
True

False

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90. Site visits to potential vendors, laboratory tests of a new product, and investigation of possible
product specifications are part of formal information search.
True

False

91. A conjunctive decision rule is very common in the first stage of a two-stage decision process with
respect to evaluation and search in an organizational buying situation.
True

False

92. Power, prestige, security, and similar noneconomic criteria have no role in business purchase
decisions.
True

False

93. People from different functional areas of an organization in a DMU will always use the same
evaluative criteria.
True

False

94. Payments, warranties, delivery dates, and so forth are examples of a purchase's terms and
conditions.
True

False

95. Organizational culture is a concept that is similar to consumer self-concept and lifestyle.
True

False

96. Organizational objectives can be categorized as commercial, governmental, nonprofit, and


cooperative.
True

False

97. In Japan and most of Europe, bribery and similar approaches for making sales are considered
acceptable.
True

False

98. Early adopters are innovative organizations that derive a great deal of their success from leading
change.
True

False

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99. To process information, a firm must go through the same sequential stages of exposure, attention,
and interpretation as consumers.
True

False

100 Emotion plays no role in organizational buying.


.
True False
101 Buyers with higher risk tolerance should prefer relational exchanges.
.
True False
102 A healthy business relationship depends on social relations.
.
True False

Essay Questions
103 Identify the internal and external influences on organizational buyer behavior.
.

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104 Compare and contrast the organizational purchase situations of straight rebuy, modified rebuy,
.
and new task with respect to situational and purchasing characteristics.

105 Harry is a sales representative for a provider of computer network systems. Part of his job entails
.
that he understand the firmographics of companies he tries to sell his company's products and
services to. Explain the concept of firmographics, and discuss the different factors that make up a
firm's firmographics and implications for marketers.

106 Name and describe the various reference groups that influence organizational behavior and
.
purchasing decisions.

19-25
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107 List five of the eight common business values representative of an innovative organization that
.
seeks change, views problems as opportunities, and rewards individual efforts.

19-26
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Chapter 19 Organizational Buyer Behavior Answer Key

Multiple Choice Questions


1.

Marketers have learned which of the following with respect to segmenting business
customers?

A.

The segment of small and moderate-sized businesses has a lot of potential.

B.

The segment of small and moderate-sized businesses has limited potential.

C.

The segment of large businesses is the most attractive.

D.

The segment of large businesses is the least attractive.

E. Tapping the potential of the small and moderate-sized business segment does not require
adapting the marketing strategy from that used to target larger businesses.
Tapping this potential requires adapting to the unique needs and wants of this customer base.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

2.

Which of the following is FALSE regarding what drives businesses?

A.
B.

Small and moderate sized businesses have a lot of potential.


Branding doesn't matter.

C.

Personal relationships matter.

D.

Businesses are consumers.

E.
None of the above is false.
Efforts to build and foster brand image are critical to marketing success.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-27
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McGraw-Hill Education.

3.

Which of the following influences organizational culture and thus, organizational buyer
behavior?

A.

culture

B.

marketing activities

C.

organizational values

D.

motives

E.
all of the above
Culture, marketing activities, organizational values, and motives all influence organizational
culture.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

4.

Which of the following is an external influence on organizational buyer behavior?

A.
B.
C.
D.

organizational values
motives
emotions
reference groups

E.
learning
Reference groups influence organizational behavior and purchasing decisions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-28
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McGraw-Hill Education.

5.

Which of the following is NOT an external influence on organization buyer behavior?

A.
B.
C.
D.

firmographics
culture
perception
government

E.
marketing activities
External influences include firmographics, culture, government, reference groups, and
marketing activities.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

6.

Carlos is trying to understand the organizational buyer behavior of firms in his sales territory.
Which of the following is an external influence on an organization's culture that he should
examine?

A.

organizational values

B.
C.
D.

needs
desires
firmographics

E.
motives
Firmographics involve both organization characteristics and characteristics of the composition
of the organization.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-29
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McGraw-Hill Education.

7.

Firmographics, culture, government, reference groups, and marketing activities are _____
influences on organizational buyer behavior.

A.
B.
C.
D.

internal
external
insignificant
primary

E.
secondary
All aspects listed are characteristics referred to as external influences in a B2B context.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

8.

Matt is currently undergoing sales training and is trying to understand the external influences
on organizational buyer behavior. Which of the following is an external influence?

A.
B.

firmographics
culture

C.

government

D.

marketing activities

E.
all of the above
All aspects listed are characteristics referred to as external influences in a B2B context.

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Difficulty: 1 Easy
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-30
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McGraw-Hill Education.

9.

Which of the following is an internal influence on organizational buyer behavior?

A.
B.
C.
D.

motives
firmographics
culture
reference groups

E.
all of the above
Internal influences include organizational values, perception, learning, memory, motives, and
emotions.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

10.

Which of the following is NOT an internal influence on organizational buyer behavior?

A.

firmographics

B.

organizational values

C.

perception

D.

motives

E.
memory
Internal influences include organizational values, perception, learning, memory, motives, and
emotions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-31
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11.

Maria is a pharmaceutical sales representative who calls on hospitals. She is taking on a new
territory, and she is trying to learn the internal influences on each hospital's culture. Which of
the following is something that she should consider with respect to internal influences?

A.
B.
C.
D.

firmographics
organizational values
reference groups
lead users

E.
competitors' marketing activity
Internal influences include organizational values, perception, learning, memory, motives, and
emotions.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

12.

Which of the following is a stage in the organizational decision process?

A.

problem recognition

B.

information search

C.

alternative evaluation

D.

outlet selection and purchase

E.
all of the above
These are all stages in the organizational decision process.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

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13.

Which of the following is NOT a stage in the organizational buying decision process?

A.

vendor support programs

B.

problem recognition

C.

information search

D.

postpurchase processes

E.
alternative evaluation and selection
Problem recognition, information search, alternative evaluation, and outlet selection and
purchase are all stages in the organizational buying decision process.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

14.

Problem recognition, information search, alternative evaluation and selection, outlet selection
and purchase, and postpurchase processes represent _____.

A.

external influences

B.

internal influences

C.

organizational culture

D.

the decision process

E.
types of buying decisions
The decision process includes problem recognition, information search, alternative evaluation
and selection, outlet selection and purchase, and postpurchase processes.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-33
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15.

Different functional areas of an organization often do all of the following EXCEPT _____.

A.
B.
C.
D.

play different roles in the purchase process


utilize different information sources
use different evaluative criteria
assign different weights to evaluative criteria

E.
All of the above are done by different functional areas.
Organizational decisions are generally complex; therefore, marketing efforts are more
complex.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

16.

The individuals (representing functional areas and management) within an organization who
participate in making a given purchase decision make up the _____.

A.

strategic business unit (SBU)

B.

decision center (DC)

C.

decision-making unit (DMU)

D.

strategic decision unit (SDU)

E.
functional decision unit (FDU)
These often function as buying centers, representing individuals from various areas of the firm.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

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17.

Sinclair is from accounting and is a member of a committee to purchase a new mainframe


computer system for his company. Sinclair is a member of the _____.

A.

strategic business unit (SBU)

B.

decision center (DC)

C.

decision-making unit (DMU)

D.

strategic decision unit (SDU)

E.
functional decision unit (FDU)
The individuals (representing functional areas and management) within an organization who
participate in making a given purchase decision make up the DMU.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

18.

Decision-making units often function as _____ when they consist of individuals from various
areas of the firm, such as accounting, engineering, manufacturing, and marketing, who meet
specifically to make a purchase decision.

A.

buying centers

B.

purchasing agents

C.

consultants

D.

intermediaries

E.
opinion leaders
These are often relatively permanent for recurring decisions and ad hoc for nonroutine ones.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

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19.

Which of the following is a characteristic of a decision-making unit?

A.

They are often relatively permanent for nonroutine decisions.

B. Even less important decisions are likely to involve individuals from a wide variety of
functional areas.
C. Large, highly structured organizations ordinarily involve more individuals in a purchase
decision than do small, less formal organizations.
D. Decision-making units are typically a separate permanent organizational department in
large organizations.
E. Small organizations do not use formalized decision-making units.
Important decisions are likely to involve individuals from a wider variety of functional areas and
organizational levels than are less important purchase decisions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

20.

A difference between large and small organizations when making a purchase decision is
_____.

A. small organizations generally involve more individuals in the decision-making process


B. large organizations generally involve more individuals in the decision-making process
C.
D.

large organizations typically have less specialization


small organizations typically have more specialized purchasing tools

E.
all of the above
Important decisions are likely to involve individuals from a wider variety of functional areas and
organizational levels than are less important purchase decisions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

19-36
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21.

Members of the decision-making unit play which of the following roles?

A.

information gatherer

B.

key influencer

C.

decision maker

D.

purchaser

E.
all of the above
A plant manager could play several roles, while corporate engineers may simply be sources of
information.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

22.

Which of the following is NOT a role played by members of the decision-making unit?

A.
B.
C.
D.

information gatherer
key influencer
regulator
user

E.
purchaser
Members of the decision-making unit play various roles, such as information gatherer, key
influencer, decision maker, purchaser, or user.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

19-37
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23.

For which stage of the product life cycle is the size of the decision-making unit typically large?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
In the introduction stage, the size of the DMU is large and can include several functions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

24.

Bob is an engineer. For which stage of the product life cycle is he likely to be a member of a
key function influencing purchase decisions?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
Engineers and R&D are likely to be involved in the introduction stage, which has the largest
DMU.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

19-38
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25.

For products in which stage of the product life cycle are engineering and R&D likely to be key
functions influencing the purchase decision?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
Engineers and R&D are likely to be involved in the introduction stage, which has the largest
DMU.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

26.

For which stage of the product life cycle is the size of the decision-making unit likely to be
neither small nor large, but medium?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
The medium stage of the product life cycle is growth and typically includes production and top
management.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

19-39
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27.

For which stage of the product life cycle is the decision-making unit likely to be small?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
The small stage is maturity and typically includes just purchasing.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

28.

For products in which stage of the product life cycle is the purchasing function of an
organization likely to be the key function influencing the purchase decision?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
The small stage is maturity and typically includes just purchasing.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

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29.

Madeline works in purchasing for a major corporation. For purchase of products, in which
stage of the product life cycle is she likely to perform a key function influencing purchase
decisions?

A.
B.
C.
D.

introduction
growth
maturity
decline

E.
fortification
The small stage is maturity and typically includes just purchasing.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

30.

Which of the following is an organizational purchase situation?

A.
B.
C.
D.

nominal
modified rebuy
limited
extended

E.
routine
This typically involves a product or service that the organization is accustomed to purchasing
but in which the product or the firm's needs have changed.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

19-41
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31.

Which type of organizational purchase situation occurs when the purchase is of minor
importance and is not complex?

A.
B.
C.
D.

nominal
modified rebuy
limited
straight rebuy

E.
routine
This is generally the case when reordering basic supplies and component parts.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

32.

Which type of organizational purchase situation is characterized by low purchase importance,


low choice complexity, level of decision-making unit (DMU) at low levels of the organization, a
very small DMU, very brief time to decision, and very limited decision search?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.
limited
This is generally the case when reordering basic supplies and component parts.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

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33.

Which type of organizational purchase situation is characterized by high purchase importance


and complexity, a large and evolving decision-making unit that includes the top of the
organization, a long time to decision, extensive information search and analysis techniques,
and a dominant strategic focus?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.
limited
This would involve decisions on such things as selecting a new advertising agency or a new
production system.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

34.

Juan's job as a purchasing agent consists mostly of reordering basic supplies and component
parts. Which type of organizational purchase situation does this represent?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.
limited
Reordering basic supplies and component parts is known as a straight rebuy.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

19-43
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35.

The College of Business at a major university is considering the purchase of technology


necessary to enable them to put their curriculum online. This decision is very important and
includes a very large and evolving decision-making unit. Which type of organizational
purchase situation does this represent?

A.

nominal

B.

straight rebuy

C.

modified rebuy

D.

new task

E.
limited
Decisions on such things as selecting a new advertising agency or new technology is known
as a new task.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

36.

In high-tech markets, who is most likely to recognize a problem or need to purchase?

A.

CEO

B.

accounting personnel

C.

purchasing manager

D.

head of a department

E.
consumer
In high-tech markets, the department head is most likely to recognize a problem or need to
purchase.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

19-44
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37.

Which of the following can possibly be part of the informal information search process for
organizational buyers?

A.

site visits to evaluate a potential vendor

B.

laboratory test of a new product or prototype

C.

investigation of possible product specifications

D.

discussions with sales representatives

E.
All of the above are part of informal information search.
Informal information search can occur during discussions with sales reps, while attending trade
shows, or when reading industry-specific publications.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

38.

Darryl is a chemist at a pharmaceutical company, and he was asked by the decision-making


unit at his company to visit and evaluate potential vendors that will supply his company with
the chemicals required to manufacture their products and to conduct laboratory tests of a new
product that can be used in the manufacture of their products. Darryl is assisting the company
with which type of information search?

A.
B.
C.
D.

formal
informal
priority
secondary

E.
direct
Site visits to evaluation and investigate a new product are part of formal information search.

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Topic: Steps in the Organizational Decision Process

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39.

Shawn tries to obtain information that might assist his company whenever he talks with sales
representatives, attends trade shows, or when he reads the journals related to his industry.
Shawn is conducting a(n) _____.

A.

formal information search

B.

informal information search

C.

direct information search

D.

indirect information search

E.
secondary information search
Informal information search can occur during discussions with sales reps, while attending trade
shows, or when reading industry-specific publications.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

40.

Which type of decision rule is very common in the first step of a two-stage decision for an
organizational purchase?

A.

conjunctive

B.

disjunctive

C.

lexicographic

D.

compensatory

E.
elimination-by-aspects
In this manner, the organization can screen out potential vendors that do not meet all its
minimum criteria.

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Topic: Steps in the Organizational Decision Process

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41.

Marcus works in operations. Which of the following evaluative criteria is NOT important to
him?

A.

ease of maintenance of equipment

B.

competence of service technicians

C.
D.

vendor offers a broad line


time needed to install equipment

E.
product warranty
Different members of the decision-making unit have different evaluative criteria.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

42.

Payments, warranties, delivery dates, and so forth represent _____.

A.

purchase specifications

B.

product specifications

C.

terms and conditions

D.

postpurchase evaluation

E.
relationship marketing
Purchasing is more concerned with terms and conditions.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

19-47
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43.

Laura's job is to negotiate the payment schedule, warranties, and delivery dates for major
purchases made by her company. Laura deals with the _____ of the purchase.

A.

evaluative criteria

B.

product specifications

C.

terms and conditions

D.

postpurchase evaluation

E.
relationship marketing aspect
Purchasing is more concerned with terms and conditions.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

44.

Which of the following sources is rated as the most important information source for
purchasers and purchase influencers within organizations?

A.
B.
C.
D.

online database services


B2B magazines
salespeople
television business networks

E.
general business press
B-to-B magazines are the most important information source for purchases and purchase
influencers within organizations.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: The Internet's Role in the Organizational Decision Process

19-48
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45.

Given the informational role of the web in today's B2B environment, salespeople need to
_____.

A.

adopt the role of solution provider

B.

adopt the role of information provider

C.

replace the use of search engines

D.

redesign corporate websites

E.
all of the above
Salespeople need to adopt the role of solution provider because the customer can find a great
deal of information from the Internet.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: The Internet's Role in the Organizational Decision Process

46.

The beliefs and attitudes an organization's members have about the organization and how it
operates is known as _____.

A.
B.
C.
D.

policy and procedure


firmographics
lifestyle
organizational style

E.
organizational culture
Organizational culture is much like lifestyle in that organizations vary dramatically in how they
make decisions.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Organizational Culture

19-49
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47.

Organizations have a type of self-concept and lifestyle that the text refers to as _____.

A.

organizational ethos

B.

organizational culture

C.

organizational demeanor

D.

organizations structure

E.
none of the above
Organizational culture is much like lifestyle in that organizations vary dramatically in how they
make decisions.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Organizational Culture

48.

Which term is often used to refer to the organizational culture of a business firm?

A.
B.

firmographics
lifestyle

C.

corporate culture

D.

corporate style

E.
internal style
Organizational, or corporate, culture reflects and shapes organizational needs and desires,
which in turn influence how organizations make decisions.

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Topic: Organizational Culture

19-50
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49.

_____ involve both organization characteristics (e.g., size, activities, and location) and
characteristics of the composition of the organization (e.g., gender, age, education).

A.

Firmographics

B.

Psychographics

C.

Demographics

D.

Geographics

E.
Behaviorgraphics
Firmographics are as important to organizations as demographics are to consumers for
understanding purchase behavior.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

50.

Which of the following variables represents an organization's firmographics?

A.
B.
C.
D.

size
activities and objectives
location
industry category

E.
all of the above
An organization's firmographics include both organization characteristics and characteristics of
the composition of the organization.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-51
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51.

Which of the following is NOT a component of firmographics?

A.

company size

B.

reference groups

C.

company objective

D.

company location

E.
All of the above are components of firmographics.
Reference groups are not a component of firmographics.

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Difficulty: 1 Easy
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

52.

Which of the following statements is FALSE regarding a firm's size?

A. Large organizations are more likely than smaller ones to have a variety of specialists who
attend to purchasing, finance, marketing, and general management.
B. The same promotional message needs to be targeted to all of the various functions in the
firm.
C. Larger organizations are generally more complex than smaller ones because more
individuals participate in managing the organization's operations.
D. The purchase decision in a smaller firm might involve only the owner or manager.
E. One message would need to address all the key purchase issues when targeting a smaller
firm.
Promotional messages must be tailored to meet the individual needs of the various functions in
the firm.

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Difficulty: 3 Hard
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-52
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53.

Organizational objectives can be categorized as _____.

A.

commercial

B.

governmental

C.
D.

nonprofit
cooperative

E.
all of the above
General organizational objectives help classify the nature of organizational activity.

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Difficulty: 1 Easy
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

54.

Which of the following is NOT a category of organizational objectives?

A.

commercial

B.

governmental

C.
D.

nonprofit
cooperative

E.
temporal
Organizational objectives can be categorized as commercial, governmental, nonprofit, and
cooperative.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-53
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McGraw-Hill Education.

55.

Organizational activities can be categorized as _____.

A.

routine

B.

complex

C.

technical

D.

A and B

E.
A, B, and C
General organizational objectives help classify the nature of organizational activity.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

56.

The American Red Cross participates in fund-raising activities all throughout the year. How
would this be classified with respect to general organizational objectives and the nature of the
organizational activity?

A.

commercial objective, routine activity

B.

governmental objective, routine activity

C.

nonprofit objective, routine activity

D.

cooperative objective, routine activity

E.
nonprofit objective, complex activity
Fundraising would be classified as a nonprofit objective with a routine activity.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-54
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57.

General Electric commits millions of dollars a year to research and development to develop
new products. How would this be classified with respect to general organizational objectives
and the nature of the organizational activity?

A.

commercial objective, routine activity

B.

commercial objective, complex activity

C.

commercial objective, technical activity

D.

cooperative objective, technical activity

E.
nonprofit objective, complex activity
New product development is classified as commercial objective, technical activity.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

58.

A commercial firm in which stock is widely traded is known as a(n) _____.

A.

public firm

B.

cooperative firm

C.

private firm

D.

open firm

E.
trade firm
A public firm is owned by stockholders.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-55
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59.

Roger owns 200 shares of stock in Home Depot. Which type of commercial firm is Home
Depot?

A.

public firm

B.

cooperative firm

C.

private firm

D.

open firm

E.
trade firm
A public firm is owned by stockholders.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

60.

A commercial firm in which one or a few individuals owns a controlling share of the firm is
known as a(n) _____.

A.

public firm

B.

cooperative firm

C.

private firm

D.

open firm

E.
nontrade firm
A private firm is owned by one or a few individuals.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-56
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61.

Robert Mondavi is a well-known winery in Napa Valley, CA. It is a family-owned business and
is not traded on any stock exchange. Which type of commercial firm is this known as?

A.

public firm

B.

cooperative firm

C.

private firm

D.

open firm

E.
nontrade firm
A private firm is owned by one or a few individuals.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

62.

Which of the following is NOT an objective uncovered through research that drives the
management of privately held firms?

A.
B.
C.
D.

building a place for the entire family to work and be involved


becoming wealthy
avoiding corporations and working for others
building a lasting "empire"

E.
changing governmental regulations
Changing government regulations is not a motive that drives the management of private firms.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-57
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63.

The types of individuals who work in the organization represent the organization's _____.

A.

size

B.

composition

C.

macrosegment

D.

reference group

E.
demographic group
The types of individuals who work in the organization heavily influence organization cultures
and are part of the organization's composition.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

64.

The culture of most organizations is influenced most heavily by which of the following?

A.

government

B.

overall membership

C.

founder and top management

D.

competition

E.
customers
Culture begins at the top, but the overall composition of the organizational membership is also
important.

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Difficulty: 3 Hard
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Topic: Firmographics

19-58
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65.

Organizations with distinguishing firmographics can be grouped into market segments through
a process called _____.

A.

industry identification

B.

infrastructure segmentation

C.

conjoint analysis

D.

macrosegmentation

E.
factor analysis
These segments are based on differences in needs due to firmographics.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

66.

Which of the following statements regarding culture and government is TRUE?

A. Variations in values and behaviors across cultures affect organizations as well as


individuals.
B.

In Europe, bribery and similar approaches for making sales are acceptable.

C. In the United States, there is a close working relationship between businesses and
government.
D. Worker welfare is more important than corporate profit in most U.S. companies.
E. Plant closure laws, layoff regulations, and worker benefits tend to be much higher in the
United States than in European countries.
Corporate culture and behavior in a given country will tend to reflect that of the individual.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Culture/Government

19-59
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67.

Perhaps the most powerful type of reference group in industrial markets is that of _____.

(p. 674)

A.

innovators

B.

lead users

C.

government regulators

D.

market mavens

E.
business press
Lead users are innovative.

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Difficulty: 1 Easy
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

68.

Innovative organizations that derive a great deal of their success from leading change are
referred to as _____.

A.

innovators

B.

lead users

C.

government regulators

D.

market mavens

E.
opinion leaders
Lead users are perhaps the most powerful type of reference group in industrial markets.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

19-60
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69.

Which of the following is NOT considered a user reference group in organizational buying?

A.
B.
C.
D.

lead user
trade press
early adopters
followers

E.
All of the above are considered a user reference group.
The trade press is an infrastructure reference group.

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Difficulty: 3 Hard
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

70.

Microsoft is a company that has derived a great deal of success from leading change, and
other computer-related companies look to Microsoft for cues as to where technology will be
heading in the future. Microsoft would be classified as which type of user reference group?

A.

lead user

B.

industry leader

C.

early adopters

D.

followers

E.
supportive firm
Microsoft is an innovative organization that derives a great deal of its success from leading
change.

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Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

19-61
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71.

Lead users tend to accelerate market adoption, which is labeled as _____.

A.

market pull

B.

primary demand

C.

market push

D.

secondary demand

E.
leading indicator
Accelerating market adoption is known as market push.

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Difficulty: 3 Hard
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

72.

Which of the following is an infrastructure reference group?

A.
B.
C.
D.

business press
followers
early adopters
lead firms

E.
government regulators
The business press is an infrastructure reference group.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

19-62
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73.

_____ refers to the flow of purchase influence within an industry.

A.

User reference groups

B.

Reference group infrastructure

C.
D.

Diffusion of innovations
Two-stage decision process

E.
Buying centers
The success of a new technology product depends on how the firm influences the reference
groups along the continuum separating it from its market.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

74.

Which of the following can influence an organization's decision to buy or not buy a given
product, or to buy or not buy from a given supplier?

A.

trade associations

B.

financial analysts

C.

dealer organizations

D.

business press

E.
all of the above
These are all part of the infrastructure reference groups that influence purchase within an
industry.

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Difficulty: 1 Easy
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

19-63
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75.

Lead users tend to accelerate diffusion of information through infrastructure, which is labeled
as _____.

A.

market pull

B.

primary demand

C.

market push

D.

secondary demand

E.
leading indicator
The tendency of lead users to accelerate diffusion of information through the infrastructure is
referred to as market pull.

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Difficulty: 3 Hard
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

76.

Which of the following is a value representative of an innovative organization that seeks to


change, views problems as opportunities, and rewards individual efforts?

A.
B.

Risk taking is discouraged.


Cooperation is more important than competition.

C.

Change is negative and actively avoided.

D.

Hard work comes first, leisure second.

E.
Rank or status is more important than performance.
This value is representative of an innovative organization that seeks change, views problems
as opportunities, and rewards individual efforts.

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Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Organizational Values

19-64
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77.

Which of the following is the MOST important element of the communications mix in most
industrial markets?

A.
B.
C.
D.

advertising
sales promotion
sales calls
public relations

E.
pricing
Advertising is important, but direct sales calls are the most persuasive element in the
communications mix.

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Difficulty: 2 Medium
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Perception

78.

For which type of industry are average costs per sales call the highest?

A.
B.

manufacturing
service

C.
D.

retail
wholesale distribution

E.
nonprofit
In the manufacturing industry, the cost per sales call is thought to be in the range of $300.

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Difficulty: 3 Hard
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Perception

19-65
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79.

Which of the following is a reason for the significant role of salespeople in industrial markets?

A.

It is the least expensive form of communication for the selling organization.

B. Business buyers prefer to do business with firms they know, like, and trust, and sales
personnel are the most common representative of the selling organization.
C. Advertising has been shown to not have any positive impact on awareness and sales.
D. Business buyers usually are not allowed to purchase without the assistance of a sales
representative.
E.
None of the above is a reason.
Those relationships are most often formed between members of the firm involved, with sales
personnel being the most common representative of the selling organization.

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Difficulty: 3 Hard
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Perception

80.

Which organization buyer segment doesn't want value-added service and doesn't want to pay
for it?

A.

commodity buyers

B.

underperforming buyers

C.
D.

partner buyers
most-valuable buyers

E.
government buyers
Commodity buyers want the basic product at the lowest price.

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Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

19-66
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81.

Which organizational buyer segment is expensive to serve, but loyal and willing to pay for
value-added services?

A.

commodity buyers

B.

underperforming buyers

C.
D.

partner buyers
most-valuable buyers

E.
government buyers
These customers should be managed in a relational manner, with an eye toward increasing the
efficiencies of the relationship to lower costs and increase profits.

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Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

82.

Which form of organizational buyer exchange involves single transactions, is short lived,
involves few involvements by the buyer and seller in the relationship, and involves low loyalty?

A.

relational

B.

transactional

C.

procurement

D.

transient

E.
temporary
The transactional buyer is focused only on the transaction, not on what's the cheapest, the
best, or the fastest for the money.

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Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

19-67
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McGraw-Hill Education.

83.

Which form of organizational buyer exchange involves multiple events, occurs over an
extended period of time, and involves higher levels of loyalty?

relational

A.
B.

transactional

C.

procurement

D.

transient

E.
temporary
The relational customer is focused on finding a distributor he can trust and depend on.

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Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

True / False Questions


84.

Various factors beyond functional utility influence organizational decisions.


TRUE
Businesses are made up of individuals, and these individuals make the purchase decisions.

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Difficulty: 1 Easy
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

85.

Buying units (BU) are the individuals within an organization who participate in making a given
purchase decision.
FALSE
Decision-making units (DMUs) are the individuals within an organization who participate in
making a given purchase decision.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

86.

Individual power and expertise have virtually no influence on organizational decisions because
it is a group process involving DMUs.
FALSE
How the final purchase decision is made is determined in part by individual power and
expertise.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

87.

Decision-making units are likely to vary over the product life cycle.
TRUE
Decision-making units are likely to vary over the product life cycle (new products versus older
ones).

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Decision-Making Unit

88.

Organizational purchase situations are known as straight rebuy, modified rebuy, and new task.
TRUE
There are 3 types of purchase situations in organizations and they are straight rebuy, modified
rebuy, and new task.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

19-69
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89.

Limited rebuy is the approach used in an organizational buying situation when the purchase is
moderately important to the firm or the choice is somewhat complex.
FALSE
Modified rebuy is the approach used when the purchase is moderately important to the firm or
the choice is somewhat complex.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

90.

Site visits to potential vendors, laboratory tests of a new product, and investigation of possible
product specifications are part of formal information search.
TRUE
These are some of the ways individual buyers search for information.

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Difficulty: 1 Easy
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

91.

A conjunctive decision rule is very common in the first stage of a two-stage decision process
with respect to evaluation and search in an organizational buying situation.
TRUE
In this manner, the organization can screen out potential vendors that do not meet all its
minimum criteria.

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Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

19-70
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92.

Power, prestige, security, and similar noneconomic criteria have no role in business purchase
decisions.
FALSE
For example, research finds that there are organizations that buy "green," similar to "green
consumers."

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

93.

People from different functional areas of an organization in a DMU will always use the same
evaluative criteria.
FALSE
Different members of the decision-making unit have different evaluative criteria.

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Difficulty: 2 Medium
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

94.

Payments, warranties, delivery dates, and so forth are examples of a purchase's terms and
conditions.
TRUE
Terms and conditions are both complex and critical in business-to-business markets.

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Difficulty: 1 Easy
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Steps in the Organizational Decision Process

95.

Organizational culture is a concept that is similar to consumer self-concept and lifestyle.


TRUE
Organizations have a type of lifestyle in that they have distinct ways of operating.

AACSB: Analytical Thinking


19-71
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Accessibility: Keyboard Navigation


Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Organizational Culture

96.

Organizational objectives can be categorized as commercial, governmental, nonprofit, and


cooperative.
TRUE
General organizational objectives help classify the nature of organizational activity.

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Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

97.

In Japan and most of Europe, bribery and similar approaches for making sales are considered
acceptable.
FALSE
These governments enforce a wide array of laws prohibiting such behaviors.

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Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Culture/Government

98.

Early adopters are innovative organizations that derive a great deal of their success from
leading change.
FALSE
Lead users are innovative organizations that derive a great deal of their success from leading
change.

AACSB: Analytical Thinking


Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

19-72
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

99.

To process information, a firm must go through the same sequential stages of exposure,
attention, and interpretation as consumers.
TRUE
Given the more complex nature of organizations, the processes involved are also more
complex.

AACSB: Analytical Thinking


Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Perception

100.

Emotion plays no role in organizational buying.


FALSE
The risk of making a bad purchase decision can elicit feelings of self-doubt or psychological
discomfort.

AACSB: Analytical Thinking


Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Motives and Emotions

101.

Buyers with higher risk tolerance should prefer relational exchanges.


FALSE
Buyers with lower risk tolerance should prefer relational exchanges because such an approach
reduces uncertainty over access to and quality of the inputs they buy.

AACSB: Analytical Thinking


Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

102.

A healthy business relationship depends on social relations.


TRUE
This dimension deals with friendship, closeness, and the extent of buyer-seller communication.

AACSB: Analytical Thinking


19-73
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Accessibility: Keyboard Navigation


Blooms: Remember
Difficulty: 2 Medium
Learning Objective: 19-04 Explain the influence of organizational buyer segments on marketing strategy
Topic: Organizational Buyer Segments and Marketing Strategy

Essay Questions
103.

Identify the internal and external influences on organizational buyer behavior.

External influences include firmographics, culture, government, reference groups, and


marketing activities. Internal influences include organizational values, perception, learning,
memory, motives, and emotions.

AACSB: Analytical Thinking


Blooms: Understand
Difficulty: 1 Easy
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Organizational Buyer Behavior

19-74
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

104.

Compare and contrast the organizational purchase situations of straight rebuy, modified rebuy,
and new task with respect to situational and purchasing characteristics.

Table 19-2 summarizes the characteristics influencing each type of purchase. Two situational
characteristics are listed:
a. Purchase importancelow for straight rebuy; moderate for modified rebuy; high for new
task.
b. Choice complexitylow for straight rebuy; moderate for modified rebuy; high for new task.
Several purchasing characteristics are listed:
a. Size of DMUvery small for straight rebuy; medium for modified rebuy; large, evolving for
new task.
b. Level of DMUlow for straight rebuy; mid-level for modified rebuy; top of organization for
new task.
c. Time to decisionvery brief for straight rebuy; moderate for modified rebuy; long for new
task.
d. Information searchnone/very limited for straight rebuy; moderate for modified rebuy;
extensive for new task.
e. Analysis techniquesnone/price comparisons for straight rebuy; several for modified
rebuy; extensive, complex for new task.
f. Strategic focusnone for straight rebuy; limited for modified rebuy; dominates for new task.

AACSB: Analytical Thinking


Blooms: Understand
Difficulty: 3 Hard
Learning Objective: 19-01 Describe the organizational purchase process
Topic: Purchase Situation

19-75
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

105.

Harry is a sales representative for a provider of computer network systems. Part of his job
entails that he understand the firmographics of companies he tries to sell his company's
products and services to. Explain the concept of firmographics, and discuss the different
factors that make up a firm's firmographics and implications for marketers.

Firmographics involve both organizational characteristicsfor example, size, activities,


objectives, location, and industry categoryand characteristics of the composition of the
organizationfor example, gender age, education, and income distribution of employees. Six
firmographic factors were discussed in the chapter:
a. Sizelarge organizations are more likely than smaller organizations to have a variety of
specialists who attend to purchasing, finance, marketing, and general management. That there
are often multiple individuals involved in the purchase in a large organization means
advertising and sales force efforts must be targeted at various functions in the firm, each
emphasizing issues of concern only to that function. Marketing communications targeted to a
small firm, however, are more likely to be able to use one message.
b. Activities and objectivesorganizational objectives can be categorized as commercial,
governmental, nonprofit, and cooperative, and the general nature of organizational activities
can be described as routine, complex, or technical. Each combination implies different
concerns for buying organizations (see Table 19-7).
c. Locationregional subcultures within the United States influence organizational cultures as
well as individual lifestyles. Location-based differences are magnified when doing business in
foreign cultures.
d. Industry categoryfirms of similar size, location, activity, objective, and ownership can still
have sharply differing cultures due to being in differing industries.
e. Organization compositionthe types of individuals who work in the organization also
heavily influence organization cultures.
f. Macrosegmentationorganizations with distinguishing firmographics can be grouped into
market segments through this process.

AACSB: Analytical Thinking


Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Firmographics

19-76
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

106.

Name and describe the various reference groups that influence organizational behavior and
purchasing decisions.

Perhaps the most powerful type of reference group in industrial markets is that of lead users.
Lead users are innovative organizations that derive a great deal of their success from leading
change. Other reference groups such as trade associations, financial analysts, and dealer
organizations also influence an organization's decision to buy or not buy a given product or to
buy or not buy from a given supplier. Reference group infrastructure refers to the flow of
purchase influence within an industry. Figure 19-2 combines the concept of lead users with
reference group infrastructure to give a more comprehensive picture of organizational
reference group systems.

AACSB: Analytical Thinking


Blooms: Understand
Difficulty: 2 Medium
Learning Objective: 19-02 Summarize the external factors that influence organizational culture
Topic: Reference Groups

107.

List five of the eight common business values representative of an innovative organization that
seeks change, views problems as opportunities, and rewards individual efforts.

The eight common business values listed in the chapter are (students only have to list five):
a. Risk taking is admired and rewarded.
b. Competition is more important than cooperation.
c. Hard work comes first, leisure second.
d. Individual efforts take precedence over collective efforts.
e. Any problem can be solved.
f. Active decision making is essential.
g. Change is positive and is actively sought.
h. Performance is more important than rank or status.

AACSB: Analytical Thinking


Blooms: Understand
Difficulty: 3 Hard
Learning Objective: 19-03 Summarize the internal factors that influence organizational culture
Topic: Organizational Values

19-77
Copyright 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.