About This Chapter
This topic covers important exam questions based on key concepts such as the matrix structure, the mechanistic organizations, the multi-divisional structure, and the organic model. It features multiple choice practice questions as well as a True or False practice quiz, designed to evaluate your understanding and enhance exam readiness. An answer key is provided for self-assessment and review. The learning objectives include: What are some of the more common organizational forms that an organization might adopt for its structure? What is organizational design, and what factors does the organizational design process depend on? What are the major elements of an organizational structure?
Question 1
Multiple Choice
Easy
Matrix structure Exam

The matrix structure gives each employee ________ chain(s) of command.

  • team-based
  • mechanistic
  • at least two
  • infinite
  • organic
Correct Answer: at least two
Explanation:

The matrix structure gives each employee (at least) two chains of command, two groups with which to interact, and two sources of information to consider. Some companies use multi-layered structures. The number of chains of command match the number of layers in the matrix.

Glossary:

Task Interdependence: The degree to which team members interact with and rely on other team members for information, materials, and resources needed to accomplish work for the team.

Question 2
Multiple Choice
Medium
Matrix structure Exam

At Blue Wall Technology, employees are grouped according to their functional expertise as well as the different vital product lines that they are working on. Thus, the company has simultaneously created a combination of a functional and a product structure. This is an example of a ________ structure.

  • conglomerate
  • geographic
  • simple
  • global
  • matrix
Correct Answer: matrix
Explanation:

Matrix structures are more complex forms of organizational design that try to take advantage of two types of structures at the same time. Employees are distributed into teams or projects within the organization on the basis of both their functional expertise and the product that they happen to be working on. The matrix represents a combination of a functional structure and a product structure.

Glossary:

Product Structure: An organizational form in which employees are grouped around different products that the company produces.

Question 3
Multiple Choice
Easy
Matrix structure Exam

Matrix structures

  • are generally used by small organizations in which the manager, president, and owner are all the same person.
  • place the functions required to serve a business under a manager who is in charge of a specific location.
  • organize their businesses around serving customers that all act in a similar way.
  • group business units around different products that the company produces.
  • try to take advantage of two types of structures at the same time.
Correct Answer: try to take advantage of two types of structures at the same time.
Explanation:

Matrix structures are more complex forms of organizational design that try to take advantage of two types of structures at the same time.

Glossary:

Matrix Structures: A complex form of organizational structure that combines a functional and multi-divisional grouping.

Question 4
True False
Medium
Matrix structure Exam

To keep the stress level low and avoid multiple chains of command issues, managers should adopt the matrix structure.

True
False
Correct Answer: False
Explanation:

The matrix structure gives each employee two chains of command, two groups with which to interact, and two sources of information to consider. This doubling of traditional structural elements can create high stress levels for employees if the demands of their functional grouping are at odds with the demands of their product- or client-based grouping.

Glossary:

Stress: The psychological response to demands when there is something at stake for the individual, and where coping with these demands would tax or exceed the individual’s capacity or resources.

Question 5
True False
Easy
Matrix structure Exam

Matrix structures try to take advantage of two types of structure at the same time.

True
False
Correct Answer: True
Explanation:

Matrix structures try to take advantage of two types of structure at the same time. The most common matrix structure combines a functional structure and a product structure.

Glossary:

Matrix Structures: A complex form of organizational structure that combines a functional and multi-divisional grouping.

Question 6
Multiple Choice
Medium
Mechanistic organizations Exam

As organizations become larger, they tend to become more ________ in nature.

  • simple
  • cultural
  • mechanistic
  • organic
  • flat
Correct Answer: mechanistic
Explanation:

As organizations become larger, they need to rely on some combination of specialization, formalization, and centralization to control their activities and thus become more mechanistic in nature.

Glossary:

Mechanistic Organizations: Efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Question 7
Multiple Choice
Medium
Mechanistic organizations Exam

In a mechanistic organization, employees are

  • encouraged to engage in lateral communication.
  • required to make their own decisions when appropriate.
  • given a very narrow view of the tasks they are to perform.
  • urged to develop knowledge outside of their specialization.
  • asked to think more broadly in terms of where their responsibilities lie.
Correct Answer: given a very narrow view of the tasks they are to perform.
Explanation:

Mechanistic organizations are characterized by a high degree of work specialization; employees are given a very narrow view of the tasks they are to perform.

Glossary:

Mechanistic Organizations: Efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Question 8

Which of the following structures generally develop from companies with functional structures whose interests and goals become too diverse for that structure to handle?

  • mechanistic
  • global
  • multi-divisional
  • matrix
  • organic
Correct Answer: multi-divisional
Explanation:

Multi-divisional structures are bureaucratic organizational forms in which employees are grouped into divisions around products, geographic regions, or clients. Multi-divisional structures generally develop from companies with functional structures whose interests and goals become too diverse for that structure to handle.

Glossary:

Multi-Divisional Structure: An organizational form in which employees are grouped by product, geography, or client.

Question 9

Lasting Skin Care Inc. is growing very fast in both sales and number of employees. It manufactures and sells skin products for youth, male, female, elderly, and ethnic populations all over the United States and several other countries. So far, the company has followed a simple structure. However, with fast-paced growth, it has become a necessity that the company explore other organizational structures. Larry, a long-time employee at Lasting Skin Care, has collected information on how some of its competitors have organized their companies. Tracks Inc. groups its employees by their different areas of expertise such as Marketing, Finance, Human Resources, and Operations. Fine Base, which is primarily in the United States, groups its activities as Northeast Division, Southeast Division, Northwest Division, Southwest Division, and Central Division. Prints Inc. has organized its employees according to the accounts they serve, such as Large Company Contracts, Internet Sales, Individual Sales, and Small Salon Direct Sales. Finally, Make safe International has grouped its business units around different types of makeup, including the Lipstick and Lip Gloss Division, the Eye shadow Division, the Foundation Division, the Mascara Division, and the Bronzer and Blush Division. Which of the following describes Make safe International's organizational structure?

  • matrix
  • product
  • functional
  • geographic
  • client-based
Correct Answer: product
Explanation:

Product structures group business units around different products that the company produces. Each of those divisions becomes responsible for manufacturing, marketing, and doing research and development for the products in its own division.

Glossary:

Organizational Structure: Formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.

Question 10
Multiple Choice
Medium
Multi-divisional structure Exam

A large pharmaceutical company recently adopted a structure in order to give its top managers more responsibility and flexibility. The company is now structured around five customer groupings: major healthcare provider networks, individual consumers, small and mid-sized pharmacies, military bases and government employee facilities, and public clinics. Which of the following organizational structures has this company created?

  • client-based
  • geographic
  • functional
  • product
  • simple
Correct Answer: client-based
Explanation:

When organizations have a number of very large customers or groups of customers that all act in a similar way, they might organize their businesses around serving those customers.

Glossary:

Client Structure: An organizational form in which employees are organized around serving customers.

Question 11

Which of the following is a bureaucratic organizational form in which employees are grouped into divisions around products, geographic regions, or clients?

  • mechanistic structures
  • global structures
  • multi-divisional structures
  • matrix structures
  • organic structures
Correct Answer: multi-divisional structures
Explanation:

Multi-divisional structures are bureaucratic organizational forms in which employees are grouped into divisions around products, geographic regions, or clients.

Glossary:

Multi-Divisional Structure: An organizational form in which employees are grouped by product, geography, or client.

Question 12
Multiple Choice
Easy
Organic model Exam

Organic organizations are

  • efficient, rigid, predictable, and standardized organizations that thrive in stable environments.
  • more complex designs that try to take advantage of two types of structures at the same time.
  • flexible, adaptive, outward-focused organizations that thrive in dynamic environments.
  • business units grouped around different products that the company produces.
  • flat organizations with one person as the central decision-making figure.
Correct Answer: flexible, adaptive, outward-focused organizations that thrive in dynamic environments.
Explanation:

Organic organizations are flexible, adaptive, outward-focused organizations that thrive in dynamic environments.

Glossary:

Organic Organizations: Flexible, adaptive, outward-focused organizations that thrive in dynamic environments.

Question 13
True False
Easy
Organic model Exam

Organic organizations are efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

True
False
Correct Answer: False
Explanation:

Organic organizations are flexible, adaptive, outward-focused organizations that thrive in dynamic environments. Mechanistic organizations are efficient, rigid, predictable, and standardized organizations that thrive in stable environments.

Glossary:

Organic Organizations: Flexible, adaptive, outward-focused organizations that thrive in dynamic environments.

Question 14
Multiple Choice
Easy
Organic model Exam

In an organic organization,

  • employees know exactly whom they report to.
  • employees are not encouraged to make decisions without their manager's consent.
  • there are very clear lines of authority from the employee to the president of the company.
  • employees are encouraged to develop knowledge and expertise outside of their specialization.
  • information is passed through vertical communication between an employee and his or her supervisor.
Correct Answer: employees are encouraged to develop knowledge and expertise outside of their specialization.
Explanation:

One of the characteristics of organic organizations is that the employees are encouraged to develop knowledge and expertise outside of their specialization.

Glossary:

Organic Organizations: Flexible, adaptive, outward-focused organizations that thrive in dynamic environments.

Question 15
Multiple Choice
Medium
Organic model Exam

Organic organizations are typified by a structure that relies on

  • a rigid and hierarchical chain of command.
  • high degree of work specialization.
  • centralization of decision making.
  • high levels of formalization.
  • weak chains of command.
Correct Answer: weak chains of command.
Explanation:

Organic organizations are typified by a structure that relies on low levels of formalization, weak or multiple chains of command, low levels of work specialization, and wide spans of control.

Glossary:

Chain Of Command: Answer to the question of “who reports to whom?” and signifies formal authority relationships.