Which of the following statements about an organization in a dynamic business environment is True?
- It does not change frequently.
- It allows organizations to primarily focus on efficiency.
- It requires organizations to have structures that are more rigid.
- It requires little change over time.
- It requires organizations to have structures that are more adaptive.
Stable environments allow organizations to focus on efficiency and require little change over time. In contrast, dynamic environments change on a frequent basis and require organizations to have structures that are more adaptive.
Business Environment: The outside environment, including customers, competitors, suppliers, and distributors, which all have an impact on organizational design.
One of the biggest environmental factors affecting organizational structure is whether the
- competitor's structure matches industry needs.
- external culture clashes with intrinsic values.
- suppliers' cultures match the company's.
- outside environment is stable or dynamic.
- internal environment is stable or dynamic.
One of the biggest factors in an environment's effect on structure is whether the outside environment is stable or dynamic.
Organizational Structure: Formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.
Organizational design is the process of
- creating procedures used to standardize employee behavior.
- creating, selecting, or changing the structure of an organization.
- empowering employees to have a greater say in the decision-making process.
- determining how corporate management offices will be laid out and decorated.
- describing an organization's objectives and goals and how it tries to make money.
Organizational design is the process of creating, selecting, or changing the structure of an organization.
Organizational Design: The process of creating, selecting, or changing the structure of an organization.
Paul's Creations makes handcrafted furniture out of vine twisted sassafras wood. Paul's could make the furniture more efficiently, but the individual touch and specially selected wood draws in customers who are willing to pay a premium for Paul's Creations' furniture. Paul's Creations is an example of a
- matrix.
- differentiator.
- low-cost producer.
- mechanistic design.
- geographic structure
Companies that focus on a low-cost producer strategy rely on selling products at the lowest possible cost. To do this well, they have to focus on being as efficient as they can be. Such companies are more likely to take a mechanistic approach to organizational design. Other companies might follow a differentiation strategy. Rather than focusing on supplying a product or service at the lowest cost, these companies believe that people will pay more for a product that is unique in some way. It could be that their product has a higher level of quality or offers features that a low-cost product does not.
Differential Exposure: Being more likely to appraise day-to-day situations as stressful, thereby feeling that stressors are encountered more frequently.
Michelle's Universal Boat Fins makes one product, a type of boat fin designed to fit on any pontoon boat, over and over again. The fins never change, because the unique design fits all boats. Given the nature of its business, Michelle's should
- look for ways to vary its manufacturing procedures.
- give each employee a specific task to perform.
- allow employees to make their own decisions.
- have a low mechanistic structure.
- adopt an organic structure.
If a company makes the exact same thing over and over, it should focus on creating that one thing as efficiently as possible by having high levels of specialization, formalization, and centralization. However, if technologies need to be changed or altered to suit the needs of various consumers, it follows that decisions would be more decentralized and the rules and procedures the organization relies on would need to be more flexible.
Task Performance: Employee behaviors that are directly involved in the transformation of organizational resources into the goods or services that the organization produces.
Organizational structure can have a significant impact on an organization's financial performance.
Organizational structure can have a significant impact on an organization's financial performance.
Organizational Structure: Formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.
________ formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.
- The span of control
- Formalization
- Centralization
- An organizational structure
- The chain of command
An organizational structure formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company. It can have a significant impact on its financial performance and ability to manage its employees.
Organizational Structure: Formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company.
Eileen is the leader of a small compost facility that caters to organic farmers. She has to decide how many employees each supervisor will oversee, and how closely they will watch over them. This is an example of Eileen shaping her company's
- supply chain.
- profit margin.
- cultural values.
- mission statement.
- organizational structure.
An organizational structure formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company. It can have a significant impact on its financial performance and ability to manage its employees.
As companies grow larger, their organizational charts get simpler.
As companies grow larger, their organizational charts get more complex.
Organizational Chart: A drawing that represents every job in the organization and the formal reporting relationships between those jobs.
Davanna is describing her company's organizational structure. Which of the following terms would she use in her description?
- newcomer orientation
- work specialization
- personality testing
- cognitive ability
- cultural values
The five main elements of organizational structure are work specialization, chain of command, span of control, centralization, and formalization.
Work Specialization: The degree to which tasks in an organization are divided into separate jobs.
Dana is the CEO of a large technology company. She has some very talented employees, but the company keeps falling behind its competitors. When Dana observes what is going on, she finds some cases where managers are micromanaging good employees, while other managers cannot address all the needs of their employees. Dana needs to address how her talent is
- recruited.
- identified.
- organized.
- disciplined.
- compensated.
An organizational structure formally dictates how jobs and tasks are divided and coordinated between individuals and groups within the company. It can have a significant impact on its financial performance and ability to manage its employees.
Needs: Groupings or clusters of outcomes viewed as having critical psychological or physiological consequences.
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 Tracks' organizational structure?
- client-based
- geographic
- functional
- product
- matrix
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.
Client Structure: An organizational form in which employees are organized around serving customers.
A plastic injection molding company, Flexiplast, has diversified to the point that the products it sells are very different and managing them has become overwhelming. Which of the following structures would help Flexiplast manage this situation?
- simple
- product
- functional
- geographic
- client-based
Product structures make sense when firms diversify to the point that the products they sell are so different that managing them becomes overwhelming.
Production Blocking: A type of coordination loss resulting from team members having to wait on each other before completing their own part of the team task.
When Lakefront Marine Company groups its business units around the different lines of boats such as the Shark, Bass, and Catfish, which of the following structures is it creating?
- simple
- product
- functional
- geographic
- client-based
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.