Culture
________ describes the collectively shared values and norms of an organization's members.
A. Competitive advantage
B. Organizational structure
C. Organizational culture
D. Core competency
C. Organizational culture
Susan works for a firm that has high degrees of formalization in their organizational structure. She understands that one of the main drawbacks of working in a firm with such high levels of formalization can often result in which of the following?
A. increased vertical integration
B. less co-opetition
C. a slower decision-making process
D. increased organizational inertia
C. a slower decision-making process
Vanessa just graduated from law school and wants to open her own law firm. Vanessa should probably adopt a(n) ______ structure for the firm.
A. M-form
B. simple
C. matrix
D. functional
B. simple
Successful ________ requires managers to design and shape structure, culture, and control mechanisms.
A. strategy innovation
B. strategy implementation
C. strategy formulation
D. strategy diversification
B. strategy implementation
Which of the following descriptions best exemplifies adverse selection?
A. An interview candidate lists his qualifications in chronological order.
B. A manager cannot ascertain the contributions of individual team members in team production.
C. An employee spends time on social networking sites during work hours.
D. A research scientist uses the organization's resources to conduct personal research.
B. A manager cannot ascertain the contributions of individual team members in team production.
Employees learn about an organization's culture through the process of
A. socialization.
B. acculturation.
C. exploitation.
D. co-opetition.
A. socialization
Organizational design is
A. a process that always functions independently of strategy formulation.
B. the process of creating, implementing, and modifying the structure of an organization.
C. primarily focused on formulating effective strategies, not implementing them.
D. primarily focused on replacing a firm's competitive advantage with competitive parity.
B. the process of creating, implementing, and modifying the structure of an organization.
Elvira is the CEO of All Things Inc. which employs a matrix structure which is the combination of the ________ and ________ structure.
A. simple; functional
B. network; functional
C. M-form; simple
D. functional; M-form
D. functional; M-form
________ is best described as a set of goal-directed actions a firm takes to gain and sustain superior performance relative to competitors.
A. Strategy
B. Credo
C. Behavior modification
D. Competency management
A. Strategy
Which of the following characteristics of a public stock company deals with principals and agents?
A. legal personality
B. separation of legal ownership and management control
C. transferability of investor ownership
D. limited liability of investors
B. separation of legal ownership and management control
Which of the following statements is true of organizational culture?
A. According to research, more than 50 percent of firms change culture successfully.
B. Changes in culture are too frequent to have any impact on strategic implementation.
C. It is always better to focus on output control and performance than on organizational culture.
D. It is better for founder CEOs to create a relevant culture, structure, and strategy in the early stages.
D. It is better for founder CEOs to create a relevant culture, structure, and strategy in the early stages.
________ refers to the degree to which decision making is concentrated at the top of the organization.
A. Formalization
B. Naturalization
C. Centralization
D. Specialization
C. Centralization
Which of the following could most likely have prevented the accounting scandals of the early 2000s and the global financial crisis?
A. adopting a narrow shareholder perspective
B. separating economic interests and social needs
C. practicing effective corporate governance
D. adopting the principles of shareholder capitalism
C. practicing effective corporate governance
The first step to gain and sustain a competitive advantage is to
A. understand the strategies of the competitors.
B. develop functional and business-level strategies.
C. put the guiding policies of a firm into practice.
D. define a firm's vision, mission, and values.
D. define a firm's vision, mission, and values.
A company that is using extrinsic motivation as an output control mechanism will most likely
A. cut budgets during recessions
B. organize training sessions for employees
C. threaten to lay off employees if they do not achieve targets
D. implement a peer review system.
C. threaten to lay off employees if they do not achieve targets
When do employees fail to adopt the organizational values of a firm?
A. when the strategic leaders in the firm propagate and exhibit the same values
B. when the organizational structure, such as its strategic decision making, is aligned with its values
C. when the internal stakeholders of the firm are involved in designing the values
D. when the top managers in the firm are merely paying lip service to the firm's stated values
D. when the top managers in the firm are merely paying lip service to the firm's stated values
McDonald's operates Hamburger University that trains students to ensure consistent food quality across its outlets throughout the world. This indicates that McDonalds's
A. is mechanistic in nature.
B. is organic in nature.
C. has an informal structure.
D. has a decentralized structure.
A. is mechanistic in nature.
Mark owns Drones 'R' Us, Inc. and is looking for an alternative to vertical integration. He decides to manufacture some of his own parts while keeping a few key suppliers in his industry value chain as well. This is known as
A. taper integration.
B. a balanced score card.
C. forward vertical integration.
D. strategic off shoring.
A. taper integration.
A ________ is best described as any activity a firm pursues to explore and develop new products and processes, new markets, or new ventures.
A. value chain
B. supply chain
C. strategic initiative
D. corrective action
C. strategic initiative
Which of the following best explains why a board of directors may grant stock options as part of a compensation package?
A. to align incentives between shareholders and management
B. to reduce the transferability of stocks between stockholders
C. to change the liability of shareholders from limited to unlimited
D. to bring about a separation of CEO/chair duality
A. to align incentives between shareholders and management
Which of the following is a customer-oriented vision?
A. to be the most progressive insurance company
B. to enable businesses to improve their employee communications
C. to manufacture innovative products through continuous learning
D. to be the best automobile company in the world
B. to enable businesses to improve their employee communications
Susan wants to create a networking site that would connect local artists to homeowners who are looking for unique and original art. She knows that network effects will play a big role in her success and doesn't want to build her business using a linear value chain. Susan would best be served by employing a(n)
A. innovative social networking website.
B. razor-razor blade business model.
C. pipeline business model.
D. platform business model.
D. platform business model.
The management of Venture Manufacturing showed a commitment to ________ by increasing the salary of many female employees to meet its goal of having equal pay for women and men who perform comparable work.
A. organizational core values
B. product-oriented vision
C. scenario planning
D. upper-echelons theory
A. organizational core values
The strategic objective of a first mover during the introduction stage of the industry life cycle is to
A. lower entry barriers.
B. achieve market acceptance.
C. pursue a harvest strategy.
D. survive by drawing on deep pockets.
B. achieve market acceptance.
According to the agency theory,
A. companies should focus on generating profits for stockholders.
B. conflicts that arise in corporations should be addressed in the legal realm.
C. corporations are more than a set of contracts between parties.
D. principals and agents have interchangeable roles.
B. conflicts that arise in corporations should be addressed in the legal realm.