COPY: Management in Organizations Chapter 1

What is the primary purpose of an organization?

To maximize profits

To provide employment opportunities

To provide a social platform for employees

To achieve a set of goals through structured collaboration (correct)

What is the main focus of the 'Manager's job' section in the introduction to management?

The external environment

The process of management

Organizational goals

The functions of management (correct)

What is the term for the process of analyzing and adapting to changes in the environment?

Innovation management

Change management

Environmental analysis (correct)

Organizational development

What is the primary objective of the planning phase in management?

To establish organizational goals and plans Signup and view all the answers

What is the term for the process of creating new ideas and solutions?

Innovation Signup and view all the answers

What is the primary purpose of organizational structure?

To define roles and responsibilities Signup and view all the answers

What is the term for the process of allocating tasks and responsibilities to individuals or teams?

Job design Signup and view all the answers

What is the term for the process of bringing about positive change in an organization?

Organizational development Signup and view all the answers

What is the primary characteristic of a tall organizational structure?

Many hierarchical levels and narrow spans of control Signup and view all the answers

What is the process of significantly reducing the layers of middle management and increasing the spans of control?

Downsizing Signup and view all the answers

What is the primary advantage of centralization in an organization?

It promotes strong leadership and coordination Signup and view all the answers

What is the opposite of centralization in an organization?

Decentralization Signup and view all the answers

What is the primary advantage of decentralization in an organization?

It reduces the workload of executives Signup and view all the answers

What is restructuring in an organization?

The process of making a major change in organization structure Signup and view all the answers

What is a characteristic of a flat organizational structure?

Few hierarchical levels and wide spans of control Signup and view all the answers

What is the term used to describe the process of reducing the layers of middle management and increasing the spans of control, as well as shrinking the size of the work force?

Downsizing Signup and view all the answers

What is the main goal of managers when conducting benchmarking?

To improve strategic competitiveness by identifying activities on the value chain Signup and view all the answers

What is a source of information for benchmarking competitors' value chain activities?

Trade publications Signup and view all the answers

What is an advantage of benchmarking?

It enables the best practices in the industry to be incorporated into your own business Signup and view all the answers

What is an essential element for the success of benchmarking?

Aligning benchmarking with the organization's mission Signup and view all the answers

What is a benefit of the staff involved in the benchmarking process?

They expand their professional knowledge due to contacts and interactions with other firms Signup and view all the answers

What is the outcome of incorporating the essential elements of benchmarking?

Drive for continuous improvement and sustainable success Signup and view all the answers

What is a reason why consultancy firms collect information and make benchmarking studies?

To distribute the results without disclosing their sources Signup and view all the answers

What can benchmarking lead to?

Elimination of resistance to change Signup and view all the answers

What is the primary purpose of Competitive Benchmarking?

To compare an organization's operations against those of its competitors Signup and view all the answers

What is the final step in the process of evaluating external factors?

Effectively communicating and widely distributing the final compilation of key external factors Signup and view all the answers

Which of the following is NOT a key external factor?

Employee morale Signup and view all the answers

What is the primary purpose of Porter's Five-Forces Model of Competition?

To determine the impact of each force on a firm's success Signup and view all the answers

What is the outcome if one of Porter's Five Forces exhibits higher intensity compared to others?

The firm is likely to experience reduced profitability Signup and view all the answers

What is the significance of relationships with suppliers or distributors in achieving success?

They often play a crucial role in achieving success Signup and view all the answers

What is the primary purpose of assimilating and evaluating information?

To identify key external factors Signup and view all the answers

What type of data can companies acquire by directly contacting the corporation?

Types of data not widely available in databases Signup and view all the answers

At which level of strategy formulation are functional strategies developed?

Functional level Signup and view all the answers

What is a potential source of competitive advantage for a company?

Either unique product differentiation or excelling as the industry's lowest-cost producer Signup and view all the answers

What is a characteristic of a firm that adopts a cost leadership strategy?

Offers standardized goods or services at the lowest cost Signup and view all the answers

Which of the following is an example of a company that has adopted a cost leadership strategy?

AirAsia Signup and view all the answers

What is a potential target market for a firm that adopts a cost leadership strategy?

Customers with small and medium income Signup and view all the answers

What is a limitation of a firm that adopts a cost leadership strategy?

It cannot completely ignore the possible sources of product differentiation Signup and view all the answers

What is the level of strategy formulation at which a firm decides which businesses to compete in?

Firm level Signup and view all the answers

What is the term for the strategy that focuses on offering standardized goods or services at the lowest cost?

Cost leadership strategy Signup and view all the answers

What happens when the industry is dominated by a limited number of suppliers?

Supplier power is strong. Signup and view all the answers

What is the first step in the EFE matrix method?

List and categorize major external factors. Signup and view all the answers

What does a rating of 1 in the EFE matrix indicate?

The firm has a poor response to the factor. Signup and view all the answers

What is the purpose of allocating a weight to each factor in the EFE matrix?

To prioritize the factors. Signup and view all the answers

Which industry is an example of one where suppliers have significant power?

Oil Signup and view all the answers

What is the outcome of multiplying the weight of each factor by its corresponding rating in the EFE matrix?

The total weighted score for the company. Signup and view all the answers

Why is it important to consider supplier power when analyzing an industry?

Because suppliers can integrate downstream and compete with current buyers. Signup and view all the answers

What is the purpose of the EFE matrix?

To visualize and prioritize the opportunities and threats confronting a business. Signup and view all the answers

What is the primary purpose of evaluating the effectiveness of implemented strategies?

To replace ineffective strategies with more viable ones Signup and view all the answers

What is the primary focus of the external environment in strategic management?

Compiling a list of potential advantages and threats Signup and view all the answers

What is included in the general environment in strategic management?

External forces that may influence long-term decisions Signup and view all the answers

What is an example of a political and legal force that may impact an organization?

Environmental protection laws Signup and view all the answers

Why is it important for firms to assess the potential impact of political variables on competitive strategies?

Due to the increasing global interdependence among economies Signup and view all the answers

What is the impact of the imposition of high taxes on an organization?

It prompts many firms to relocate elsewhere Signup and view all the answers

What is the primary purpose of monitoring the business landscape and internal operations?

To continue to improve competitiveness Signup and view all the answers

What is the outcome of ineffective strategies in an organization?

They are replaced with more viable ones Signup and view all the answers

What is the primary benefit of the strategic alliance between Spotify and Uber?

To provide personalized experiences to Uber riders Signup and view all the answers

What is the outcome of MasterCard's partnership with Apple Pay?

MasterCard was able to up its brand presence by associating itself with Apple Signup and view all the answers

What is the potential threat to the sustainability and trust between partners in a strategic alliance?

One partner's strategic intent may involve gaining specific knowledge to become a competitor Signup and view all the answers

What is the result of the partnership between Chevrolet and Disney?

Creation of Test Track at Walt Disney World's EPCOT theme park Signup and view all the answers

What is a key aspect to consider when choosing a partner for a strategic alliance?

The partner brings in complementary skill sets and expertise Signup and view all the answers

What is a common goal of strategic alliances?

To drive significant revenue and growth for the organizations involved Signup and view all the answers

What is the role of MasterCard's expertise in the Apple Pay system?

To address bugs and resolve issues for customers promptly and efficiently Signup and view all the answers

What is the benefit of the strategic alliance between Uber and Spotify to Spotify?

To gain access to a wider customer base Signup and view all the answers

What type of organizational characteristics are typically found in firms that operate in a stable environment?

Highly centralized decision making, many rules and regulations Signup and view all the answers

What is the primary focus of Strategic Management?

Managing an organization's resources, analyzing internal and external forces, and developing strategies to achieve its vision and mission Signup and view all the answers

What is the outcome of differentiation within an organization?

Units within the organization differ from one another in terms of behaviors and orientations Signup and view all the answers

What is the primary goal of integration within an organization?

To enable collaboration among departments that need to coordinate their efforts Signup and view all the answers

What type of organizational characteristics are typically found in firms that operate in a highly unstable and uncertain environment?

Decentralized decision making, few rules and regulations Signup and view all the answers

What is the outcome of an organization's strategic management process?

The organization achieves its vision and mission Signup and view all the answers

What is the primary benefit of organizations operating in a highly unstable and uncertain environment adopting organic characteristics?

Improved ability to adapt to changes in the environment Signup and view all the answers

What is the primary purpose of Strategic Management in relation to an organization's resources?

To manage an organization's resources to achieve its objectives Signup and view all the answers

What is the primary purpose of Strategic Group Mapping?

To identify the competitive positions of rival firms in an industry Signup and view all the answers

What is a guideline for constructing Strategic Group Maps?

The variables selected as axes should have a big difference between them Signup and view all the answers

What determines the relative size of each strategic group?

The combined sales of the firms in each group Signup and view all the answers

What is the first step in the construction of a Strategic Group Map?

Analyzing the overall industry and identifying competitive characteristics Signup and view all the answers

Why should different competitive variables be used as axes for the Strategic Group Map?

Because different variables may lead to different insights Signup and view all the answers

What can Strategic Group Mapping help firms to recognize?

Both favorable and unfavorable market positions Signup and view all the answers

What is a characteristic of a strategic group?

A set of firms emphasizing similar strategies with similar resources Signup and view all the answers

What can Strategic Group Mapping guide firms in determining?

Which strategic groups to target for market entry Signup and view all the answers

What is the definition of management according to Frederick Winslow Taylor?

Knowing exactly what you want people to do, and then seeing that they do it in the best and cheapest way Signup and view all the answers

What is the core part of management, according to the contemporary approach?

Coordinating Signup and view all the answers

What is the origin of the word 'management'?

Latin words Signup and view all the answers

Who is credited with defining the major components of management?

Henry Fayol Signup and view all the answers

What is the primary purpose of management?

To achieve organizational goals Signup and view all the answers

What is the primary advantage of a matrix structure in an organization?

Efficient use of support systems Signup and view all the answers

What are the four functions of management?

Planning, organizing, leading, and controlling Signup and view all the answers

What is the definition of management according to Bartol and Martin?

The process of achieving organizational goals by engaging in the four functions of planning, organizing, leading, and controlling Signup and view all the answers

What is the primary disadvantage of a matrix structure in an organization?

High administrative costs Signup and view all the answers

What is the primary focus of contingency factors in determining the best organizational structure?

Size, technology, and environment Signup and view all the answers

What is the etymology of the word 'management'?

From Latin words 'manus' and 'agere' Signup and view all the answers

What is the primary characteristic of unit and small-batch production technology?

Products are customized to meet customer specifications Signup and view all the answers

What is the primary focus of technological interdependence in organizational structure?

The degree of information exchange between departments Signup and view all the answers

What is the primary characteristic of continuous-process production technology?

Products are made through a continuous process Signup and view all the answers

What is the primary advantage of considering contingency factors in organizational structure?

It ensures the best structure for a given organization Signup and view all the answers

What is the primary disadvantage of a high level of technological interdependence in an organization?

It slows down the response to change Signup and view all the answers

What is the primary purpose of strategic group mapping in business analysis?

To identify key competitors and understand their competitive strategies Signup and view all the answers

What is the outcome of performing an internal audit in an organization?

Improving the process of communication Signup and view all the answers

What is the primary characteristic of tangible resources?

They are observable and quantifiable Signup and view all the answers

What is the primary benefit of involving representative managers and employees in internal environment analysis?

To improve the process of communication Signup and view all the answers

What is the primary purpose of internal environment analysis?

To gather and assimilate information about a firm's management and operations Signup and view all the answers

What is the primary benefit of internal audit in an organization?

It provides an excellent occasion for improving the process of communication Signup and view all the answers

What is the primary characteristic of intangible resources?

They lack a physical presence but provide substantial benefits to the organization Signup and view all the answers

What is the primary outcome of conducting internal environment analysis?

Improving the process of communication and enabling the company to gain a competitive advantage Signup and view all the answers

What percentage of the information a firm needs to make strategic decisions is available and accessible to the public?

90% Signup and view all the answers

What is the primary purpose of a competitive intelligence program?

To analyze industry dynamics and competitor vulnerabilities Signup and view all the answers

Which of the following sources of strategic information involves disassembling products to gain insights?

Reverse Engineering Signup and view all the answers

What is the primary focus of defensive competitive intelligence?

Monitoring one's own business activities from an external perspective Signup and view all the answers

Why is competitive intelligence gathering not considered corporate espionage?

Because most of the information is publicly available Signup and view all the answers

Which of the following sources of strategic information provides valuable data, but often requires an excessive lead time?

Government Agencies Signup and view all the answers

What is the primary purpose of gathering competitive intelligence?

To further a business's own goals Signup and view all the answers

What is the primary advantage of searching online databases for competitive intelligence?

It's a quicker and less expensive method Signup and view all the answers

What is the primary purpose of Inbound Logistics in the Value Chain?

To store and distribute inputs to a product Signup and view all the answers

Which of the following is NOT a primary activity in the Value Chain?

Procurement Signup and view all the answers

What is the purpose of Technological Development in the Value Chain?

To enhance a firm's products and manufacturing processes Signup and view all the answers

What is the primary purpose of Outbound Logistics in the Value Chain?

To collect, store, and distribute the final product to customers Signup and view all the answers

Which of the following Value Chain activities is focused on facilitating the means by which customers can purchase products?

Marketing and Sales Signup and view all the answers

What is the primary purpose of Support activities in the Value Chain?

To provide the necessary assistance for primary activities to unfold effectively Signup and view all the answers

What is the primary purpose of Procurement in the Value Chain?

To acquire the necessary inputs for production Signup and view all the answers

Which of the following Value Chain activities is focused on enhancing or maintaining a product's value?

Service Signup and view all the answers

What is the main basis for grouping positions in a functional structure?

Similarity of expertise, skills, and work activities Signup and view all the answers

What is the primary advantage of a functional structure?

In-depth development of expertise Signup and view all the answers

Which of the following is NOT a common function in an organization?

Information Technology Signup and view all the answers

What is the total value of the strengths of a company in the given scenario?

2.74 Signup and view all the answers

What is a disadvantage of a functional structure?

Slow response time on multifunctional problems Signup and view all the answers

What is the primary purpose of benchmarking?

To identify the best practices used by competitors and implement them to improve activities Signup and view all the answers

What is the primary responsibility of the Research and Development (R&D) function?

Producing unique ideas and methods for new products and services Signup and view all the answers

What is the value of the strength 'Diversified income'?

0.4 Signup and view all the answers

Which of the following is a characteristic of a functional structure?

Clear career path within function Signup and view all the answers

What is the primary benefit of a functional structure in terms of employee development?

Narrow training for potential managers Signup and view all the answers

What is the weakness with the highest rating in the given scenario?

Over-dependence on sales from UK Signup and view all the answers

What is the primary characteristic of a tall organizational structure?

Many hierarchical levels and narrow spans of control Signup and view all the answers

What is the main advantage of decentralization in an organization?

It eases the heavy workloads of executives, leaving them more time to focus on major issues Signup and view all the answers

What is the primary reason why functional structure can lead to slow response time on multifunctional problems?

Sequential tasks and bottlenecking Signup and view all the answers

What is the total value of the weaknesses of a company in the given scenario?

2.74 Signup and view all the answers

What is the primary purpose of identifying the strengths and weaknesses of a company?

To identify areas for improvement and opportunities for growth Signup and view all the answers

What is the primary goal of downsizing in an organization?

To reduce the layers of middle management and increase the spans of control Signup and view all the answers

What is the primary advantage of centralization in an organization?

It is easier to coordinate the activities of various units and individuals Signup and view all the answers

What is the value of the strength 'Brand reputation valued at $35 billion'?

0.24 Signup and view all the answers

What is the key difference between downsizing and restructuring?

Downsizing involves reducing management levels, while restructuring involves changing components of the organization Signup and view all the answers

What is the primary benefit of benchmarking?

To identify areas for improvement and opportunities for growth Signup and view all the answers

What is the primary characteristic of a flat organizational structure?

Few hierarchical levels and wide spans of control Signup and view all the answers

What is the outcome of decentralization in an organization?

Executives have more time to focus on major issues Signup and view all the answers

What is the primary reason why companies downsize?

To reduce the layers of middle management and increase the spans of control Signup and view all the answers

At which level of strategy formulation is a firm's strategy established to compete in a specific business?

Business level Signup and view all the answers

What is a characteristic of a firm that adopts a cost leadership strategy?

Offering standardized goods or services at the lowest cost Signup and view all the answers

What is a potential source of competitive advantage for a company?

All of the above Signup and view all the answers

What is the primary purpose of formulating a strategy at the firm level?

To establish the fields of activities and the markets on which the firm will compete Signup and view all the answers

What is an example of a company that has adopted a cost leadership strategy?

AirAsia Signup and view all the answers

What is a limitation of a firm that adopts a cost leadership strategy?

It cannot completely ignore the possible sources of differentiation of products Signup and view all the answers

What is a potential target market for a firm that adopts a cost leadership strategy?

Customers with small and medium income Signup and view all the answers

What is a characteristic of a firm that adopts a differentiation strategy?

It targets customers with high and medium income Signup and view all the answers

What is the term for the strategy that focuses on offering standardized goods or services at the lowest cost?

Cost leadership strategy Signup and view all the answers

What can be a competitive risk of a differentiation strategy?

Customers balking at the price gap Signup and view all the answers

What is an example of a company that has adopted a differentiation strategy?

Nike Inc. Signup and view all the answers

What can be a way to differentiate a product or service?

Improving quality Signup and view all the answers

What is the primary purpose of a focus strategy?

To serve the needs of a particular industry segment or niche Signup and view all the answers

What is a characteristic of a product or service that is differentiated?

It has unique characteristics Signup and view all the answers

What can be a result of imitation by rivals in a differentiation strategy?

Diminished perceived uniqueness of a differentiated product Signup and view all the answers

What is a common target market for a firm that adopts a differentiation strategy?

High and medium-income customers Signup and view all the answers

What is the primary responsibility of a line position in an organization?

Achieving the major goals of the organization Signup and view all the answers

What is the term for the authority of staff departments over others in the organization in matters related directly to their respective functions?

Functional authority Signup and view all the answers

What is the primary purpose of lateral relations in an organization?

To link activities across departments at similar levels Signup and view all the answers

What is the term for the linking of activities across departments at similar levels?

Horizontal coordination Signup and view all the answers

Decentralization leads to which of the following?

More emphasis on authority and accountability Signup and view all the answers

What is the main reason for individuals at lower levels being in a better position to make good decisions?

They are closer to the problem and have more information Signup and view all the answers

What type of authority do staff departments have in an organization?

Functional authority Signup and view all the answers

What is the primary difference between responsibility and authority?

Responsibility is the obligation to carry out duties, while authority is the right to make decisions Signup and view all the answers

What is the primary purpose of information systems in an organization?

To promote horizontal coordination Signup and view all the answers

What is the result of decentralization leading to the establishment of relatively independent units?

Divisions or business units that operate independently Signup and view all the answers

What type of authority do line departments have in an organization?

Line authority Signup and view all the answers

What is the relationship between delegation and responsibility?

Delegation is a way to assign responsibility Signup and view all the answers

What is the primary purpose of slack resources in an organization?

To promote horizontal coordination Signup and view all the answers

Which of the following is a reason why decentralization occurs?

Environmental certainty of the organization Signup and view all the answers

What is accountability related to?

Providing satisfactory reasons for deviations from duties or expected results Signup and view all the answers

What is the benefit of decentralization in terms of employee development?

It enriches the jobs of lower-level employees Signup and view all the answers

In a functional structure, which department is responsible for producing unique ideas and methods that will lead to new and/or improved products and services?

Research and Development (R&D) Signup and view all the answers

What is an advantage of a functional structure?

In-depth development of expertise Signup and view all the answers

Which of the following is a disadvantage of a functional structure?

Backlog of decisions at the top of the hierarchy Signup and view all the answers

In a functional structure, which department is concerned with obtaining and managing financial resources?

Finance Signup and view all the answers

What is a benefit of a functional structure in terms of career development?

Clear career path within a function Signup and view all the answers

Which of the following is NOT a characteristic of a functional structure?

Positions are grouped according to their product or market Signup and view all the answers

What is a potential drawback of a functional structure in terms of decision-making?

Backlog of decisions at the top of the hierarchy Signup and view all the answers

Which of the following is a common function in a functional structure?

All of the above Signup and view all the answers

What is the primary driver of tall organizational structures?

Many hierarchical levels Signup and view all the answers

What is the primary advantage of decentralization in an organization?

Eases the heavy workloads of executives Signup and view all the answers

What is the primary difference between downsizing and restructuring?

Downsizing focuses on reducing management levels, while restructuring focuses on changing components of the organization Signup and view all the answers

What is the primary advantage of centralization in an organization?

It helps ensure that similar activities are not carried on by different organizational units Signup and view all the answers

What is the primary characteristic of a flat organizational structure?

Few hierarchical levels and wide spans of control Signup and view all the answers

What is the primary purpose of directly contacting a corporation for data?

To acquire types of data not widely available in databases Signup and view all the answers

What is the primary goal of downsizing in an organization?

To reduce the layers of middle management and increase the spans of control Signup and view all the answers

What is the outcome of having one of Porter's Five Forces exhibiting higher intensity compared to others?

Reduced profitability Signup and view all the answers

What is the primary outcome of decentralization in an organization?

Executives have more time to focus on major issues Signup and view all the answers

What is the primary purpose of assimilating and evaluating information?

To determine opportunities and threats Signup and view all the answers

What is the primary reason why organizations adopt a flat structure?

To reduce the layers of middle management and increase the spans of control Signup and view all the answers

What is a common external factor considered by organizations?

All of the above Signup and view all the answers

What is the primary purpose of Porter's Five-Forces Model of Competition?

To determine industry competition intensity Signup and view all the answers

What is the outcome of effective communication of key external factors within an organization?

Wide dissemination of information Signup and view all the answers

What type of relationships can significantly impact an organization's success?

Relationships with suppliers or distributors Signup and view all the answers

What is an essential element in analyzing key external factors?

All of the above Signup and view all the answers