Organizational Structure And Controls

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Question 1
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Strategy has an important influence on structure, once a particular structure is in place, that structure influences strategy.

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Question 2
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Failure to properly structure an organization can contribute to poor strategic decisions and eventually bankruptcy.

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Question 3
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Strategy has an important influence on structure, although once in place, structures influence strategy.

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Question 4
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Over time, large and complex organizations must customize their structure to fit their unique strategic needs.

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Question 5
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Organizational structures must be both stable and flexible.

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Question 6
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Organizational inertia often prompts top management to initiate structural change when organizational performance levels drop.

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Question 7
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With a related diversification corporate-level strategy, financial controls are used by corporate leaders to verify the sharing of appropriate strategic factors such as knowledge, markets, and technologies across businesses.

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Question 8
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Strategic controls are largely subjective criteria intended to verify that the firm is using appropriate strategies for the conditions in the external environment and the company's competitive advantages.

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Question 9
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Organizational controls guide the use of strategy, indicate how to compare actual results with expected results, and suggest corrective actions to take when the difference is unacceptable.

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Question 10
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To properly execute strategic controls in firms using related diversification, the executives must have a deep understanding of each unit's business-level strategy.

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Question 11
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RexMacDonald, Inc., uses a differentiation strategy that relies on cooperation, communication, and sharing of ideas among employees. In order to foster this behavior, RexMacDonald should emphasize strategic controls over financial controls.

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Question 12
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Companies and business units of large diversified firms using the cost leadership strategy should use strategic controls.

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Question 13
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Companies and business units using the differentiation strategy should emphasize financial rather than strategic controls.

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Question 14
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According to Michael Dell, an overemphasis on financial controls to produce attractive short-term results contributed to performance difficulties at Dell, Inc. This point emphasizes the importance of properly balancing the use of strategic and financial controls.

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Question 15
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Research shows that structure has a more important influence on strategy than the reverse and hence the emphasis of the chapter on the subject of structure.

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Question 16
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A centralized structure does not provide information from local stores that would be useful in changing its technology quickly. This example illustrates the effect of structure on strategy.

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Question 17
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Research has consistently shown that there is one best way to structure all organizations, regardless of competitive strategy.

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Question 18
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The simple structure is used by owner-managed firms which are characterized by informal relationships, few rules, limited task specialization, and unsophisticated information systems.

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Question 19
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As a firm grows, it typically shifts from a simple structure to a functional structure.

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Question 20
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A simple structure is an organizational form in which the owner-manager makes all major decisions directly and monitors all activities, while the staff merely serves as an extension of the manager's supervisory authority.

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