MGT498 Week 3 Quiz


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MGT498 Week 3 Quiz

1. In terms of the key features of organic organizations, which of the following firms is most likely to have an organic structure?

Icebox, a software development firm, which focuses on building innovative products

Underscore, a publishing company, where decision power is concentrated at the top

Merton Inc., a retail chain, which implements a rigid division of labor

Meridian Inc.., a clothing company, which aims to produce clothes at lower prices

2. A tightly coupled system of strategy and structure is prone to break apart when

input and output controls restrict information flow.

external and internal shifts put pressure on the system.

organizational culture becomes adaptive to change.

managers fail to recognize the need for organizational inertia.

3. Why is strategy implementation referred to as the “graveyard of strategy”?

The levers that managers have at their disposal during the implementation stage of a strategy are insufficient.

The successful implementation of a strategy requires key functions in the organization to compete with each other.

Managers often fail to implement a chosen strategy successfully despite extensive analysis of business environments.

It is a process that is independent of strategy formulation and is not necessary to ensure continued success.

4. Which of the following exemplifies the organic nature of W. L. Gore’s organizational structure?

It has no formal chain of command or standard operating procedures.

It avoids the use of virtual teams.

Its employees are not allowed to review each other during performance appraisals.
Its employees exhibit lower levels of entrepreneurial behaviors and innovation.
5. Which of the following is instrumental in creating a tightly coupled system of strategy and structure in an organization?

financial metrics that focus on long-term performance

limited input and output controls

dynamic organizational strategy and structure

managers that achieve a mastery of the firm’s current environment

6. Since W. L. Gore’s core competency is innovation, a(n) ________ would most likely be detrimental to its efforts.

integration strategy

organic structure

differentiation strategy

mechanistic structure

7. Why do firms’ strategies often follow their structures instead of the other way around?

External and internal pressures increase organizational inertia in an organization.

Strategy and structure are usually loosely coupled, providing them independent movement.

Managers are eager to confront the inertia that often exists in established organizations.

Managers tend to consider strategies that do not change existing organizational structures.

8. Which of the following is a shortcoming of the matrix structure?

It often leads to an overload for the founder and/or CEO when the firms experience growth.

It cannot effectively address a higher level of diversification, which often stems from further growth.

It frequently lacks effective communication channels across departments.

Its implementation is difficult due to significant organizational complexity and increased administrative costs.

9. Over time, 3M has relied on the results-only-work-environment (ROWE) framework and has morphed into a highly science-driven innovation company. At 3M, employees are encouraged to spend 15 percent of their time on projects of their own choosing. If any of these projects look promising, 3M provides financing through an internal venture-capital fund and other resources to further develop their commercial potential. This real-world scenario best illustrates

organizational strategy.

output controls.

organizational culture.

input controls.

10. Which of the following is a characteristic of a mechanistic organization?

low formalization


flat hierarchy

high degree of specialization

11. Which of the following factors has led to a shift toward open innovation?

the increasing capability of internal suppliers

the exponential growth of venture capital

the decreasing availability of external options to commercialize ideas

the decreasing supply and mobility of skilled workers

12. _____ seek to define and direct employee behavior through a set of codified rules and standard procedures.

Input controls



Output controls

13. In order to implement a cost-leadership strategy effectively, a _________ structure is preferred in a firm.

simple and M-form

simple and organic

functional and mechanistic

functional and organic

14. Sam Walton was responsible for Walmart’s cost-leadership strategy that continues to guide the company to this day. His influence on the organization’s culture is best described as



founder imprinting.


15. Strategic business units (SBUs) in a company that uses an unrelated-diversification strategy are in direct competition with each other because

each SBU is evaluated as a standalone, profit-and-loss center.

decision making is concentrated at the top of the organization.

each SBU shares its core competencies with the other SBUs.

the firm follows a single business or dominant business strategy at the corporate level.

16. Why was Yahoo’s CEO, Jerry Yang, forced out in 2008?

He made too many changes to the organizational structure of Yahoo.

He focused on improving the user experience to drive online advertising revenues.

He failed to implement necessary strategic changes after Yahoo lost its competitive advantage.

He refused to accept the practice of obtaining consensus from his managers before making strategic changes.

17. One disadvantage of a functional structure is that it

does not allow the setting up of cross-functional teams.

does not facilitate rich and extensive communication between members of the same department.

frequently lacks effective communication channels across departments.

cannot be converted into an ambidextrous structure.

18. Which of the following is a benefit of a high degree of formalization in an organization?

increased creativity

fast decision making

excellent customer service

consistent results

19. Which of the following best indicates that W. L. Gore & Associates has an informal and decentralized organizational structure?

It prevents its associates from becoming shareholders in the company.

It is consistently ranked among the top 100 of the best companies to work for.

It prefers face-to-face communication over e-mail and does not have an organizational chart.

It determines its employees’ levels of compensation on the basis of their boss’s evaluations.

20. Inkwell is a pen manufacturing company based in Massachusetts. Inkwell’s main area of operation is Massachusetts, and it has a stronghold over the market. It employs a robust production system, which helps it sell pens at exceptionally low prices. In this scenario, which of the following strategies is Inkwell most likely using?

differentiation strategy

integration strategy

ambidextrous strategy

cost-leadership strategy