CHAPTER ONE
CHAPTER ONE
REVIEW QUESTIONS
1. What are some of the personal skills and abilities that Meg Whitman and Ken Chenault bring to their jobs as managers?
Chenault and Whitman have a broad perspective, the ability to see the need for change and implement it, good people skills, decisiveness, and the ability to persuade others. Both enjoy a challenge, take risks to follow their instincts, and have experience in management.
Answer, pp 4-5
2. What are the three critical challenges managers face today?
The three critical challenges managers face today are change, technology, and globalism. All managers are faced with the need or opportunity to change, as it is the most persistent, powerful, and pervasive challenge they face. Technology developments are occurring constantly and are often forcing changes throughout the business world. Globalism, the increasing international and cross-cultural nature of everything from politics to business, affects the way managers set goals, make decisions, and coordinate and lead the work of other people.
Answer, p 7
3. How would you define management?
Management is the process of assembling and using sets of resources in a goal-directed manner to accomplish tasks in an organizational setting.
Answer, p 8
4. Why is it important to understand management within the context of
organizations?
Managerial activities, such as decision making or communication, can happen in non-organizational settings such as a family. You can even engage in managerial activities such as planning and goal setting independently, without others being involved. However, these activities in isolation do not constitute management. Management requires integration of all these activities and the involvement of other people. This integration only occurs in an organizational context. It is similar to a dialogue taking place only when another person participates in the conversation—otherwise, it’s a monologue.
Answer, p 10
5. What are some of the factors that make individual organizations unique?
Organizations often bring together a variety of people from different backgrounds—from different ethnicities and cultures (Asian, African American, Arabic, Anglo, Irish, Vietnamese, and so on), different educational levels (high school dropouts, college graduates, and MBAs), different technical backgrounds (engineering, digital arts, and accounting), and different socioeconomic levels (from very poor to very privileged)—who must then work together to achieve common objectives. Thus, developing a degree of shared cooperation becomes essential. This can only be accomplished by gaining acceptance of existing ways of working together, using existing structures and processes, or by developing new structures and processes. These behaviors, structures, and processes over time constitute the personality, or culture, of the organization. Whatever one may think or assume about the personality or culture of, say, a typical unit of General Motors, it is likely to be different from that of Patagonia, the apparel manufacturer headquartered in Ventura, California, where an office message board posts the local surfing conditions. The basic principles of effective management are relevant in all organizations, but the specific characteristics of an organization affect how those principles are applied.
Answer, p 11-12
6. Explain the paradoxes, or trade-offs, that managers have to master to be
effective.
One of the important factors that separate great managers from mediocre managers is the recognition, acceptance, and mastery of managing paradoxes—the ability to cope with forces that pull managers in opposite directions. Great managers do not avoid these tensions but embrace them, harness them, and utilize them. Managers at times have to make decisions about trade-offs. Sometimes they do, in fact, have to go with one set of actions to achieve the desired results—for example, expand the investment in the R&D (research and development) area of the company—and in the process, forgo another investment and its potential results. That might mean postponing TV advertising during the Super Bowl for two years. However, great managers do not automatically view competing forces in terms of direct trade-offs; they often recognize that the challenge is to respond to both forces simultaneously in a creative fashion that enables the firm to accomplish both sets of objectives or some portion of them.
Answer, p 17
7. Explain why an “entrepreneurial mindset” is important to all managers.
To survive in the hypercompetitive landscape that exists in the twenty-first century managers are required to regularly search for and be open to new opportunities in their current marketplace or to ideas that could create new markets. Entrepreneurship involves identifying new opportunities and exploiting them. Thus, managers must be entrepreneurial. Entrepreneurship is not exclusive to management, especially in the current environment. Entrepreneurial activity is not limited to new, small firms. Managers in large firms need to be entrepreneurial and create new businesses as well. Developing new businesses requires that the lead person and perhaps others take entrepreneurial actions.
With an entrepreneurial mind-set, managers can sense opportunities and take actions to exploit them. Uncertainty in the environment tends to level the “playing field” for both large and smaller organizations and for resource-rich and resource-poor ones. Opportunities can be identified by anyone and exploited to achieve a competitive advantage.
Answer, p 22
8. What are the functions of management that all managers perform?
The functions that all managers perform are: planning, which is estimating future conditions and circumstances and making decisions about appropriate courses of action; organizing, which means systematically putting resources together; directing, which is the process of attempting to influence other people to attain organizational objectives; and controlling, which regulates the work of those for whom a manager is responsible.
Answer, pp 25-26
9. What are the management roles Mintzberg identified?
Mintzberg organized his typology of managerial roles into three major categories—interpersonal, informational, and decisional—each of which contains specific roles. Altogether, there are 10 such roles in this system.
Interpersonal roles are composed of three types of behavior and, according to Mintzberg, are derived directly from the manager’s formal authority granted by the organization. They are the Figurehead Role, Leader Role, and the Liaison Role. Informational Roles build on the interpersonal relationships that a manager establishes, and it underlines the importance of the network of contacts built up and maintained by the manager. The three specific informational roles identified by Mintzberg are the Monitor Role, the Disseminator Role, and the Spokesperson Role. Decisional Roles are the final category of roles in this classification system relates to the decision-making requirements of a manager’s job. Four such decisional roles are designated by Mintzberg: the Entrepreneurial Role, the Disturbance Handler Role, the Resource Allocator Role and the Negotiator Role.
Answer, pp 26-29
10. What are the skills needed by managers at all levels of the organization?
Technical skills involve specialized knowledge about procedures, processes, equipment, and the like and include the related abilities of knowing how and when to use that knowledge. Interpersonal skills like sensitivity, persuasiveness, and empathy have been shown to be important at all levels of management, although particularly so at lower and middle levels. Conceptual Skills, often called cognitive ability or cognitive complexity, are skills such as logical reasoning, judgment, and analytical abilities that are a relatively strong predictor of managerial effectiveness. These skills are often the major factor that determines who reaches the highest levels of the organization.
Answer, pp 32-34
CHAPTER 2
REVIEW QUESTIONS
1.What were the environmental shifts that prompted change at LSP?
The environmental shifts that forced change were from analog to digital technology in diagnostic instruments, from M.D.s and Ph.D.s to technicians as end users, and the shift from individual tests to integrated analysis.
Answer, pp 39-40
2. Why does managerial change often mean personal change?
Failure to adapt personally, to help other individuals change, or to effectively lead change in a team can have devastating effects on the individuals involved as well as the organization. Managers may have to change how they motivate their subordinates, gather new and increased amounts of information, make decisions, and how they negotiate conflicts to support new strategies.
Answer, p. 41
3.What is meant by the rate of change?
The rate of change is the pace at which change occurs in the environment. In a survey of executives described in the text, 87% of those responding believe the rate of change is increasing.
Answer, p. 43
4.Explain the external forces for change.
External forces for change are those in the company’s environment. These forces include competitors, socio-cultural changes, political/legal changes, economic changes, and changes in technology.
Answer, pp 44-45
5.What are the internal forces for change?
The internal forces for change can be caused by changes in leadership style, new processes or policies, new equipment, or responses to change in the external environment.
Answer, p. 45
6. List and explain the steps in the change process proposed by Kurt Lewin.
Lewin’s change process has three steps. Unfreezing is the undoing of old patterns. Once old habits are unfrozen, then you are in a position to move and make the needed changes. Movement is the changing of perceptions based on the level of certainty or uncertainty associated with the change. Refreezing is the process of reinforcing change so that it becomes established.
Answer, p. 47-50
7.Why do people fail to see the need for change?
People fail to see the need for change because they are locked into powerful past mental maps that have been successful in the past and filter new information to fit old views. Sometimes, people have an overly simplistic view of the past and the future, failing to see the significance of the changes from the past context to a new one. Lastly, people have an almost automatic resistance to unfreezing attempts because they want to maintain equilibrium.
Answer, pp 51-53
8. How does uncertainty affect the failure to move?
The greater the desired change, the greater the uncertainty. There are three dimensions of uncertainty: uncertainty centered in the change itself, outcome uncertainty, and requirement uncertainty.
Answer, pp 53-55
9. Why are some changes unfinished?
Some changes are unfinished due to lack of reinforcement, because the desired results are slow in coming, and because it is hard to recognize slow changes when you are in the middle of the process.
Answer, pp 55-56
10. What can be done to overcome the obstacles to change?
Obstacles to change can be overcome by creating high contrast to focus people on key differences. Another is by confronting them with the need to change through providing an inescapable experience.
Answer, p. 60
CHAPTER 3
REVIEW QUESTIONS
1. Which dimension of the external environment has had a very strong impact on the oil business in Russia?
The dimension of the external environment that has had a very strong impact on the oil business in Russia is the political environment. Political instability in Kazakhstan, Russia, and Georgia made it difficult to negotiate agreements about drilling and transportation. In addition, economic turbulence and social opposition have also had a “chilling effect” on the extraction and development of oil for export.
Answer, p. 75
2. What are the forces in the general environment that affect business?
The forces in the general environment that affect business are global, socio-cultural, political-legal, economic, and technology.
Answer, p. 78
3. Why is it important to understand current economic conditions, economic cycles, and structural changes?
The exact nature of the business and industry determine the specific factors that have the strongest effect on any organization. Current economic conditions are those such as the unemployment rate that determines the cost of labor, interest rates that determine the cost of money and ability of people to borrow to purchase costly items such as homes or automobiles. Economic cycles involve the expansion and contraction of the economy or of a specific industry. Knowing what is happening now and what may come in the future, or whether an industry regularly has peaks and valleys in demand is important for planning purposes. Structural changes are those that significantly affect the dynamics of economic activity now and in the future. Such structural changes as the shift from an agrarian to an industrial economy, then to a service economy requires adaptation by individuals and companies.
Answer, p. 82
4. What does the gross domestic product measure?
Gross domestic product measures the total dollar value of final goods and services produced within a nation’s borders.
Answer, p. 85
5. List and explain each of the forces in the task environment that affect business.
Forces in the task environment are competitors, suppliers, regulators, customers, labor, and strategic partners. Competitors are companies in the same industry who are rivals for your business. The nature of competition, barriers to new entrants, and switching costs are also important to understanding competition. Suppliers provide the inputs for a business and affect the supply chain. If there are few suppliers who already have customers, it may be difficult to enter the market or obtain the materials you need. Regulators include both regulatory agencies and consumer groups. The greater the power of customers, because there are few or because they are united, the greater value they can extract from producers, decreasing profits. Labor affects costs depending on supply and demand, as in other markets. Labor unions, although decreasing in numbers in the U.S., can exert pressure in many industries to increase wages and benefits that are costly. Strategic partners are those who work together in an industry to develop cost savings or convenience for companies and customers.
Answer, p. 92
6. Explain Michael Porter’s model for analyzing the task environment and how it is used.
Michael Porter’s model for analyzing the task environment does so in terms of five forces that significantly affect the performance and profitability of businesses in the same industry. It is used to decide whether entering a new industry offers a good opportunity to be profitable. It is primarily based on analysis of the competition and the difficulty of entering the market relative to intensity of rivalry, strength of suppliers, strength of customers, and availability of substitutes.
Answer, p. 92
7. What are the key factors and forces in an organization’s internal environment?
The key forces and factors in an organization’s internal environment are its owners, Board of Directors, employees, and culture.
Answer, p. 99
8. How does the Board of Directors affect the internal environment of an organization?
The Board of Directors represents the owners of an organization and has the general responsibility of overseeing the general management of the company. It may include individuals from inside and outside the company.
Answer, p. 99
9. List and explain each of the steps in the environmental scanning process.
The steps in the environmental scanning process are: 1) Define what type of information you should scan for and where and how you plan to acquire it; 2) Recognize what information is relevant; 3) Analyze the most important issues and determine the implications; 4) Respond by deciding what impact this information will have and how to act on it.
Answer, p. 102
10. How can an organization respond to information discovered in the scanning process?
They can use direct influence to create a desirable situation, form strategic alliances or joint ventures with other companies, develop an agile company that is able to respond to change quickly, and manage information by using feedback to inform the first step of the process.
Answer, p. 103
CHAPTER 4
REVIEW QUESTIONS
1.Why is it important for managers to understand culture in today’s business world?
Managers must understand culture today because it is a strong driver of behavior. Managers who understand culture can understand how to leverage it to help accomplish goals and achieve the strategic aims of the organization.
Answer, p. 116
2. Define culture and list the three levels of culture.
Culture is a learned set of assumptions, values, and behaviors that have been accepted as successful enough to be passed on to newcomers. The three levels of culture are artifacts which are visible manifestations of a culture, values which are the enduring beliefs that specific end states are preferable to others, and assumptions or beliefs about the fundamental aspects of life.
Answer, pp. 115, 121
3. Explain what is meant by a value and give an example.
A value is a belief that a specific conduct or end state is preferred to others. Honesty, for example, is preferable in U.S. culture and is usually espoused publicly in organizations.
Answer, p. 121
4. List and explain the six basic assumptions.
The six basic assumptions are: 1) Humans relation to the environment is either to live harmoniously with it or to dominate it; 2) Human nature is that people like to work or they are naturally lazy; 3) Human relationships are such that people exist because of others and have an obligation to them or that they have certain individual rights and freedoms; 4) Human activity assumes people should react to and enjoy the present or create their own destinies and must plan for the future; 5) Truth is what is socially accepted or it exists objectively; 6) Time is either like a lake and what you don’t use today will be there for you tomorrow or it is like a river, what you don’t use wisely today is gone forever.
Answer, p. 122
5. How would Theory X and Theory Y managers differ in the way they treat employees?
Theory X managers believe they have to coerce, control, direct, and threaten employees to make them work. Theory Y managers believe people want to work and are capable of self-direction, self control, and commitment.
Answer, p. 123
6. How does Hofstede’s power distance dimension affect a manager’s behavior in the U.S. and India?
Power distance is the extent to which people accept power and authority differences in a group, not whether it exists. Managers in the U.S. are more likely to eliminate status barriers and consult with their employees than those in countries such as India, the Philippines, and Venezuela.
Answer, p. 124
7. Explain what is meant by a linear assumption about time.
Cultures tend to have similar assumptions about time. Those who view time as a river generally have linear assumptions about time. That is, like a river it moves in linear fashion and what isn’t used well will be gone tomorrow, creating an emphasis on time management.
Answer, p. 125
8. What are the dimensions on which we can measure the strength or weakness of a culture?
The dimensions on which we can measure the strength or weakness of a culture are 1) The extent to which they are widely shared among group members, and 2) The extent to which they are deeply held. The strength of the culture relates to the severity of punishments for violating its values.
Answer, p. 131
9. Why is it important to identify the core values in a culture?
It is important to identify the core values in a culture because culture can be a mechanism for understanding and guiding employee behavior, interacting with those in the culture who are in the task and general environment, and for successfully creating change in organizations.
Answer, p. 134
10. List the methods managers can use to change organizational culture.
Methods managers can use to change organizational culture include rewards and compensation, performance appraisal, socialization, selection, stories, and symbols.
Answer, p. 135
CHAPTER 5
REVIEW QUESTIONS
1. Explain what is meant by managerial ethics and why they are important.
Managerial ethics is the study of morality and standards of business conduct. Violations of ethical conduct and social responsibility can lead to negative publicity, destroy stock prices and share holder value, and make it difficult to recruit high-quality employees. Well-managed ethical behavior can have positive consequences for employees, customers, shareholders, and communities.
Answer, p. 151
2. What are the key differences between managerial ethics and corporate responsibility?
Ethics are based on individual views of morality that impact organizations. Corporate social responsibility is the obligation that organizations have to their constituencies such as shareholders, employees, customers, and citizens at large.
Answer, p. 151
3. List and explain the four approaches to the formation of an ethical decision.
The utilitarian approach focuses on the consequences of the action. The moral rights approach focuses on examination of the moral standing of actions, independent of their consequences. The universal approach is choosing a course of action that you believe can apply to all people under all situations. The justice approach focuses on how equitable the costs and benefits of actions are distributed.
Answer, p. 156-159
4. What are the key elements of distributive, procedural, and compensatory justice? Give an example of how each could be used.
Distributive justice is the equitable distribution of rewards and punishments based on performance. For example, a manager cannot distribute rewards such as bonuses based on arbitrary characteristics instead of the person’s contribution to the goals of the organization. Procedural justice ensures that people affected by managerial decisions consent to the decision-making process and that the process is administered fairly. For example, employees are entitled to a fair hearing before termination.
Answer, p. 158-159
5. Why is it important to understand moral intensity?
Moral intensity is the degree to which people see an issue as an ethical one. Managers can use this framework to anticipate the moral intensity of an issue and to diagnose the reasons for differing views about the intensity of a moral issue among people.
Answer, p. 159-160
6. List the six factors that influence moral intensity and give an example of each.
1) Magnitude of the consequences assesses the impact of the outcome of a given action. For example, the layoff of 1,000 workers would have more impact than the layoff of 100. 2) Social consensus is the extent to which members of a society agree that an act is either good or bad. For example, there is greater consensus among more people in the U.S. that drunk driving is wrong than that speeding is wrong. 3) Probability of effect means that the higher the probability of the consequence, the more intense the sense of ethical obligation. For example, the more proof of the link between smoking and cancer, the more intensely people feel about restricting advertising and smoking of cigarettes in public spaces. 4) Temporal immediacy is a function of the interval between the time the action occurs and the onset of its consequences. For example, the catastrophic changes that might occur as a result of global warming don’t have immediacy, because they aren’t likely to occur for another 50 years. 5) Proximity is the physical, psychological, and emotional closeness the decision maker feels to those affected by the decision. It may include factors such as nationality, cultural background, ethnic similarity, organizational identification, age, or socioeconomic similarity. For example, a natural disaster or epidemic that occurs in the U.S. will evoke greater moral intensity than one in another country. 6) Concentration of effect is the extent to which consequences are focused on a few individuals or dispersed across many. For example, laying off 100 people has a lower magnitude of effect than 1,000, but laying off 100 in a town of 5,000 has greater magnitude than laying off 1,000 in a city of 10 million.
Answer, p. 160-161
7. How can employees be influenced to make ethical decisions?
Employees can be influenced to make ethical decisions by adopting and promulgating a Code of Ethics, reinforcing the Code with actions such as appointing an ombudsman, training employees about ethical issues, rewarding ethical behavior, and providing processes and protection for whistleblowers. The greatest impact on the ethics of an organization is the role modeling of top managers.
Answer, p. 164-170
8. Explain and compare the efficiency and stakeholder approaches to social responsibility.
The efficiency approach is the concept that a manager’s social responsibility is to maximize profits for the owners of the business. The social responsibility perspective is that society grants existence to firms, which therefore have responsibilities and obligations to society as a whole. In the stakeholders approach, managers must consider the individuals or groups who have an interest in and are affected by the organization.
Answer, p. 172-175
9. List the major stakeholders a corporation must consider in making socially responsible decisions.
An organization’s major stakeholders are its customers, employees, financiers, suppliers, communities, society at large, and shareholders.
Answer, p. 174
10. List and explain the response strategies companies can take to issues of social responsibility.
Companies may choose among the following strategies: 1) Defenders believe they must fight any effort to restrict or regulate their activities and profit-making potential; 2) Accommodators will change when legally compelled to do so; 3) Reactors believe they should respond to significant pressure even when not legally required to do so; 4) Anticipators believe they owe it to society to anticipate and avoid actions with potentially harmful consequences even if not pressured or legally required to do so.
Answer, p. 176-177
CHAPTER 6
REVIEW QUESTIONS
1. What is competitive advantage and how is it created?
Competitive advantage is the ability of a firm, over the long term, to win consistently in a competitive situation.
Answer, p. 194
2. What is the difference between inimitability and substitution?
Inimitability is the creation of barriers that make it hard for others to imitate your competitive advantage. Substitution refers to whether the customer can substitute another product or service for the need you fulfill.
Answer, p. 194-195
3. Explain appropriability and supernormal returns.
Appropriability questions whether a company can actually capture the profits to be made in a business. Supernormal returns are greater than average profits earned through greater-than-average cost-price margins.
Answer, p. 196
4. List and explain the steps in the strategic planning process. Diagram the process.
The steps in the strategic planning process are to determine strategic intent, define organizational mission, analyze the environment, set objectives, determine requirements and assess resources, develop action plans, implement plans, and monitor outcomes. The process requires assessment and feedback.
Answer, p. 197
5. What are the possible components of a mission statement?
The possible components of a mission statement are company philosophy, company identity or self-concept, principal products or services, customers and markets, geographic focus, obligation to shareholders, and commitment to employees.
Answer, p. 198
6. Explain how strategic objectives differ from strategic intent.
Strategic objectives translate the strategic intent and mission of the organization into concrete and measurable goals. They allocate resources, reach a shared understanding of priorities, delegate responsibilities, and hold people accountable for results.
Answer, p. 199
7. List and explain the generic strategies an organization could adopt.
One generic strategy an organization can adopt is cost leadership, through which a company strives to be the lowest cost producer of a product while charging slightly less than average prices to earn supernormal returns. Another strategy is differentiation which makes a product or service different from competitors on dimensions highly and widely valued by consumers, allowing them to charge premium prices. The cost of the differentiating features has to be less than the price consumers are willing to pay for it, creating high levels of return. Limited scope is another strategy that reduces the volume and revenue a firm can earn but focuses on a niche, or customer segment, which can earn supernormal returns.
Answer, p. 200-202
8. How does the value chain relate to customer service?
The value chain is the set of key activities that directly produce or support the production of what a firm ultimately offers to its customers. Michael Porter’s approach states that managers must assess the value each activity adds for the customer rather than its cost. The absolute value of a product or service is a function of how much customers are willing to pay and how many are willing to purchase it.
Answer, p. 205-206
9. Explain how the product life cycle is used as a strategic tool.
Product life cycle pictures whether a product is in its birth, growth, maturity, or decline based on how widely and quickly customers have adopted it. As products move from birth to decline, management makes decisions about product development and improvement, promotion, and otherwise investing to extend its life and profitability.
Answer, p. 209
10. How can the Boston Consulting Group’s matrix be used to analyze an organization’s businesses?
The BCG matrix can be used to analyze a company’s business by assuming that businesses have multiple products which are at different stages of the Product Life Cycle. The matrix helps managers plan future corporate strategic plans for placing the firm’s investments. The matrix places each product in one of four categories based on potential market growth and the product’s current performance or market share.
Answer, p. 211-213
11. What are the elements of SWOT analysis and how can it be used to develop strategic plans?
SWOT analysis, also known as situation analysis, is used to develop strategic plans by requiring managers to look at a firm’s Strengths, Weaknesses, Opportunities, and Threats for continued operation within its dynamic environment.
Answer, p. 214-215
12. How does McKinsey Consulting’s Seven S’s model help to implement strategies?
The Seven S framework helps implement new strategies by analyzing their fit and congruence within the existing company framework. It assesses whether there is a need to change old systems before implementing new strategies.
Answer, p. 216-217
CHAPTER 7
REVIEW QUESTIONS
1.Why is it important to understand organizational structure and design?
It is important to understand organizational structure and design to know how labor is divided into tasks and coordinated, how the organization responds to environmental demands, and divides authority relationships among groups, managers, and other employees. Understanding the principles of organization structure makes it possible to design effective organizations that will be a good fit between the environment and company strategy.
Answer, p. 229
2.Why must organizational design balance differentiation and integration?
Differentiation is based on specialization of task and knowledge necessary in organizations because no one person is able to do everything. This creates barriers between groups and people. Integration is then needed to keep people from veering off in separate directions and to coordinate them in achieving the goals of the entire organization.
Answer, p. 230
3. Define the three types of interdependence and give an example of each.
Pooled interdependence occurs when various groups are largely independent in their functions, but contribute collectively to a common output. For example, a company producing medical supplies might have separate departments each sending its product to the same hospital independent of one another. Sequential interdependence exists when the output of one group becomes the input of another group. For instance, the catalytic converters made by one group are needed to complete the automobile as it is assembled. Reciprocal interdependence is when two groups depend on one another for inputs. For instance, when marketing research provides the new product development team with ideas for new products and the new product development team provides research new products to be tested by customers.
Answer, p. 231-232
4. What are some of the mechanisms organizations use to improve integration?
Some of the mechanisms organizations use to improve integration are rules, goals, and values. Formalization using lines of authority, unity of command, and organization structures improve integration. Informal events, face to face communication such as nemawasi as used in Japan, and other informal communication can improve integration.
Answer, p. 232
5. How does uncertainty affect organization structure?
The greater the uncertainty about inputs, throughputs, and output factors, the greater the need for coordination and integration. As events unfold, individuals and organizational units have to respond in real time.
Answer, p. 232
6. What is the line of authority and how is it different from unity of command?
The line of authority specifies who reports to whom. Unity of command is the idea that an employee should have only one boss.
Answer, p. 235
7. How does the organization’s environment affect whether it is flat or tall?
Tall and formal organizations tend to be slower at making decisions and responding to changes in the business environment. Flatter organizations have fewer layers of management to work through to get a decision. A more dynamic environment requires an organization that is flatter and more able to respond to change more quickly.
Answer, p. 235
8. Why is it important to understand span of control?
Span of control refers to the number of employees reporting to any given supervisor. This is affected by the nature of the task, the subordinates’ capabilities, and the manager’s capabilities. The narrower the span of control, the more closely supervised employees will be. Narrower spans of control create taller organizations.
Answer, p. 235
9. List four common organization structures and the advantages and weaknesses of each.
Functional structures organize a firm around traditional functional areas such as marketing, production, accounting, and finance. Advantages of functional structures are that it is well suited to small medium sized firms with limited product diversification, facilitates specialization of functional knowledge, reduces duplication of functional resources, and facilitates coordination within functional areas. Weaknesses of functional structures are that it creates problems coordinating across functional groups, creates restricted views of organizational goals, can limit attention paid to customers and is slower in response to market changes, and burdens chief executives with decisions that involve multiple functions. Product structures organize a firm by specific products or related products. Advantages of product structures are improved focus on products and customers, financial performance is easier to measure, more responsive to market changes, and it reduces the burden of top management for decisions. Weaknesses of product structures are duplication and loss of economies of scale for functional areas create problems for customers who purchase products across multiple groups, greater difficulty coordinating across product groups, and it creates more conflicts between group and organization goals. Division structures organize by groups of related products. Advantages of division structure are reduction of functional duplication, customer focus can increase depending on the closeness of the product families, and cross-product and cross-regional coordination is easier within the division. Weaknesses of division structure are that this is appropriate only for large, diversified companies with significant numbers of products and product families, it can inhibit cross-division coordination, and it can create conflicts between division objectives and corporate objectives. Customer structures organize by categories of customers. Advantages of a customer structure are that it facilitates better understanding of specific customers, increases responsiveness to changes needed by customers and changes in competitive offerings. Weaknesses of a customer structure are duplication of functional resources in each customer unit, difficulty creating coordination between customer units and corporate objectives, and it can fail to leverage technology and other strengths in one unit to others. Geographic/Regional structures an organization around geographical areas or regions. Advantages of a geographic structure are that it leads to in-depth understanding of markets, customers, governments, and competitors in a given area and makes it more responsive to change there. It fosters strong accountability by managers in each area. Weaknesses of a geographic structure are that it inhibits coordination and communication between regions, creates conflict between regions, duplicates functional resources, inhibits economies of scale, and can create competition across regions that are a problem for customers who operate across regions. Matrix structures consist of two structures imposed on one another. Advantages of a matrix structure are that it facilitates information flow throughout the organization, enhances decision quality, is best suited to a changing business environment, and facilitates the flexible use of human resources. Weaknesses of a matrix structure are that it creates difficulty for performance appraisals since people each have more than one boss, can inhibit the ability to respond to changing conditions quickly, diffuses accountability, and leads to conflict between those with differing perspectives within the work units. Mixed organizational structures are often used to incorporate the strengths of one type of structure while eliminating its weaknesses.
Answer, p. 240-247
10. What are the challenges in moving from a domestic to an international structure?
The challenges in moving from a domestic to an international structure are in understanding the nature of the firm and its structure, the extent of diversification, and the extent of foreign sales.
Answer, p. 255
CHAPTER 8
REVIEW QUESTIONS
1. Why is it important for organizations to plan?
Planning is the decision-making process that focuses on the future of the organization and how it will achieve its goals.
Answer, p. 270
2. Explain what is meant by strategic, operational, and tactical plans.
Strategic plans focus on the broad future of the organization and incorporate both external environmental demands and internal resources into managers’ actions. Tactical plans translate strategic plans into specific goals for specific parts of the organization. Operational plans translate tactical plans into specific goals and actions for small units of the organization and focus on the near term.
Answer, p. 270-271
3. Which level of the organization is likely to develop each of the following: strategic plans, operational plans, and tactical plans?
Strategic plans are most likely to be developed by the top level of the organization. Tactical plans are a more specific fit within the strategic plan and are developed for separate parts of the organization. Operational plans translate tactical plans into specific goals for small units of the organization and are shorter term.
Answer, p. 273
4. How do the plans made at each level relate to one another?
Plans are hierarchical in nature, reflecting the organization’s structure. Plans made at all levels may differ from each other on time horizon, scope, complexity, impact and interdependence, but they should be aligned and integrated with each other.
Answer, p. 274
5. List and explain the activities of each step in the planning process.
The first step is analyzing the environment using forecasts, benchmarks, contingency plans, scenarios, and competitor analysis. Next is setting objectives and priorities. Once objectives are set, organizations have to determine the requirements and assess the resources they have to carry them out. Action plans establish timing and sequence of the steps to be taken and who will be accountable for each part of the plan. Implementation is carrying out the steps, monitoring them, and adjusting as needed. Monitoring outcomes requires measuring whether objectives have been achieved and analyzing reasons why they were or were not.
Answer, p. 275
6. Why is it important to have priorities among an organization’s objectives?
Priorities are needed because all objectives are not equal in importance or value. Some may also be more important now than later.
Answer, p. 279
7. What are the elements of an action plan?
The elements of an action plan are sequence, timing, and accountability.
Answer, p. 283
8. Explain why budgeting is an important part of planning and define two approaches to the budgeting process.
Budgets are used to quantify and allocate resources to specific activities. Incremental budgeting is an approach to budgeting that uses the approved budget of the previous year and then presents arguments as to why the upcoming budget should have more or less in various categories. Zero-based budgeting assumes that all allocations of funds must be justified from zero each year.
Answer, p. 287
9. List and explain the characteristics of “SMART” goals.
SMART is an acronym to remember five key characteristics of good goals. They are Specific, Measured, Agreed, Realistic, and Time bound.
Answer, p. 288-291
10. How is MBO used in goal setting?
MBO is used to motivate and measure employee performance. It involves individuals in setting goals that are challenging but achievable and align personal goals with the goals of the organization. Employees involved in setting their own goals are more committed to achieving them.
Answer, p. 291
CHAPTER 9
REVIEW QUESTIONS
1. What are the assumptions on which the rational decision model is based?
The rational decision model is based on the assumptions that problems are clear, objectives are clear, people agree on criteria and weights, all alternatives are known, all consequences can be anticipated, and decision makers are rational.
Answer, p. 307
2. List and explain the steps in the classical/rational model.
Step 1 is identifying the decision situation, whether perceived as a problem or opportunity. Step 2 is to identify desired objectives, criteria for alternatives, and relative weightings of the criteria. Step 3 is to generate alternatives by reviewing past solutions or creating new ones. Step 4 analyzes alternatives for feasibility and best results. Step 5 is the selection of an alternative. Step 6 is implementation of the decision identifying reasons for resistance, chronology and sequence of actions, required resources, and delegation of tasks. Step 7 monitors and evaluates the results of the decision.
Answer, p. 302
3. How does the classical rational model differ from the bounded rationality model?
These two models differ in their assumptions about information available and what is the “best” decision. Unlike the rational model, bounded rationality assumes that people usually settle for acceptable rather than maximum options because the decisions they confront typically demand greater information processing capabilities than they possess.
Answer, p. 309
4. Explain Peter Soelberg’s implicit favorite model.
The implicit favorite model, also known as the retrospective decision model, focuses on how decision makers attempt to rationalize their choices after they are made.
Answer, p. 310
5. Explain the difference between programmed and non-programmed decisions and give an example of each.
A programmed decision is a standard response to a simple or routine problem, such as reimbursement for travel expenses or college admissions decisions. A non-programmed decision is about a problem that is either poorly defined or unique, such as whether to purchase new equipment or a new facility.
Answer, p. 311
6. Describe Gresham’s law of planning and why it is important.
Gresham’s law of planning is the tendency for managers to let programmed activities overshadow non-programmed activities.
Answer, p. 312
7. List the benefits and problems of group decision-making.
Groups can accumulate more knowledge and facts, have a broader perspective, are more likely to support the decision, and serve useful communication and motivation functions. Groups often work more slowly than individuals, involve compromise that may lead to less than optimal decisions, can be dominated by one or a few members, and can inhibit the ability of managers to act quickly when necessary.
Answer, p. 317
8. Explain how the Vroom-Yetton model helps managers know when to use participative decision making.
This model helps managers decide which situations are best served by using groups to make decisions, when it is appropriate, and to what level groups should participate in making decisions.
Answer, p. 320
9. Describe what is meant by Groupthink and how it can be overcome.
Groupthink is a mode of thinking in which pursuit of agreement among members becomes so dominant that it overrides a realistic appraisal of alternative courses of action. It can be overcome by using strategies to encourage development of more alternatives and appointing a “devil’s advocate” to question those offered.
Answer, p. 323
10. How can managers prevent the decision error known as escalating commitment?
By encouraging all to think of past investments as sunk costs that cannot be recovered, focusing on the importance of matching current decisions to current conditions as they change, encouraging each member to evaluate prospects of future outcomes critically or bring in outside experts to challenge the group’s expectations, and appointing a devil’s advocate to challenge the majority decision.
Answer, p. 327-328
CHAPTER 10
REVIEW QUESTIONS
1. Define leadership and explain why it is a social influence process.
Leadership is defined in the text as an interpersonal process involving attempts to influence other people in attaining some goal. It is a social influence process because it involves other people, most often as they interact in groups and organizations.
Answer, p. 350
2. What does strategic leadership mean and who should use it?
Strategic leadership has meant leadership exhibited by those who are members of top management, but has expanded to mean leadership exhibited at all levels of the organization with a strategic focus. It involves thinking and acting strategically while working with others to create a viable future for the organization.
Answer, p. 351
3. List and explain the types and sources of power and give an example of each.
Position powers include legitimate, reward, and coercive power. Personal powers include expert and referent power. Legitimate power is granted to a person by an organization based on the person’s position, such as manager, and is sometimes called authority. Reward power is based on the person’s ability to provide valued rewards to other people, such as pay increases, promotions, or recognition. Coercive power is based on the ability to punish others through withholding desired rewards such as pay raises or administering punishments such as reprimands or dismissal. Personal power is based on the individual, rather than a person’s position in the organization. Expert power is based on having knowledge useful to others, such as legal knowledge. Referent power derives from a person’s ability to attract or have others identify with him or her. For example, an employee may imitate an admired manager’s actions.
Answer, p. 352
4. What are four issues for managers to consider when using power?
Four issues for a manager to consider when using power are: How much to use in a given situation? Which types of power should be used? How can power be put to use? Should power be shared?
Answer, p. 358
5. List five influence tactics and when each is useful.
Rational persuasion can be used when there is time to gather information for a choice among options. Apprising can be used to build alliances with other managers to reach a commonly beneficial goal. Consultation can be used to win the support of a work group to a proposed change. Pressure can be used when time is short and an employee has missed deadlines in the past. Legitimating tactics can be used to get compliance with a company policy, procedure or rule.
Answer, p. 359
6. Why is empowerment a useful leadership tool and how can it be used effectively?
It is an important leadership tool because increased participation in decision making and control of work increases commitment to achieving goals. It can be used effectively to increase decision making skills and confidence in subordinates and cope successfully with major changes and transitions.
Answer, p. 360
7. What is meant by the “locus of leadership” and why is it important to understand?
The “locus of leadership” is the intersection of the basic components of the leadership process: leaders, followers, and the situation. It is important to understand because each element influences and is influenced by the others two variables. A change in one will alter how the other two factors interact.
Answer, p. 361
8. List five traits that research has shown to be important to effective leadership.
Five traits important to effective leadership are: drive, motivation to lead, honesty and integrity, self-confidence, and emotional maturity.
Answer, p. 361
9. List the elements of emotional intelligence and social intelligence and explain why they are important to the leadership process.
The elements of emotional intelligence are self-awareness, self-regulation, motivation, empathy, and social skill. The elements of social intelligence are social perceptiveness, behavioral flexibility, and “savvy”. They are important to the leadership process because those who lead must understand themselves, be perceptive, and able to read others to be effective in motivating them and flexible in differing situations.
Answer, pp. 363-364
10. What do followers bring to the process and how does LMX affect it?
Followers bring their own personality traits, past experiences, knowledge, skills and abilities, and beliefs and attitudes. LMX Theory is a relationship-based approach to leadership that recognizes the importance of followers in a strong, mutually respectful exchange process between leaders and followers. Although they vary considerably, the development of such relationships is a process that can lead over time to strong influence over the behavior of subordinates.
Answer, p. 367
CHAPTER 11
REVIEW QUESTIONS
1. What are the two dimensions of leader behavior found by Blake & Mouton and the ideal combination of them?
Blake and Mouton proposed that leaders should view their role as consisting of two primary dimensions: focus on tasks to be accomplished and focus on the people performing them. Those leaders who would be most effective would be those highest in both dimensions.
Answer, p. 381
2. What are the four types of behavior identified by Hersey and Blanchard and when is each appropriate?
The four types of behavior identified in Hersey and Blanchard’s Situational Model are: Participating, Telling, Delegating, and Selling. Participating is appropriate when followers are high in ability and low in motivation; telling is appropriate when ability and motivation are low; delegating is appropriate when ability and motivation are high; selling is appropriate when ability is low and motivation is high.
Answer, p. 382
3. What is the major principle in Fiedler’s theory?
The major principle in Fiedler’s theory is that it is possible to identify the types of situations in which task-oriented or person-oriented leaders would be most effective.
Answer, p. 384
4. What is a leader’s main responsibility according to House’s theory and how can it be met?
A leader’s main responsibility, according to House’s theory, is to increase subordinate satisfaction and effort by increasing personal payoffs for goal attainment and making the paths to the payoffs easier.
Answer, p. 385
5. What is the purpose of the Vroom-Yetton model?
The purpose of the Vroom-Yetton model is to prescribe standards to determine the extent to which subordinates should be allowed to participate in decision-making.
Answer, p. 386
6. Name and explain six substitutes for leadership.
1) Ability, experience, and training can substitute for leadership in fast-paced jobs that require many decisions and subordinates have to rely on their experience, training, and judgment. 2) Highly educated professionals would not need much supervision as professional standards are part of their education. 3) Intrinsically satisfying work such as new product development or teaching does not depend on extrinsic rewards from supervisors. 4) Cohesive work groups with positive performance norms influence group members to conform or be excluded without supervision. 5) Advisory or support staff can provide training or information the supervisor doesn’t have. 6) Direct feedback from the task can provide intrinsic satisfaction and rewards from achieving goals.
Answer, p. 387
7. How does management differ from leadership?
Management differs from leadership as explained by several scholars in that leadership is more concerned with developing vision, goals, new directions, and inspiring subordinates. Managers are more concerned with mundane tasks of dealing with interpersonal conflict, planning, organizing, and carrying out goals set by others. To be effective, managers must be both leaders and managers.
Answer, p. 389
8. List some of the traits of a charismatic leader and explain the problems with charismatic leadership.
Some of the traits of a charismatic leader are strong needs for power, high levels of self-confidence, and strong beliefs in their own ideas. Charismatic leaders do not fit well in many situations because they are overpowering and they can lead in bad directions as well as good.
Answer, p. 391
9. Explain the difference between transactional and transformational leaders. Illustrate with examples.
Transformational leaders are inspiring and use coaching to empower others to achieve major organizational change. An example would be Jeff Bezos who was able to transform from a small, new company to the organization it is today. Transactional leaders are those who focus on an exchange of rewards and self interest to accomplish routine changes. Managers at all levels exhibit this behavior in rewarding employees for work with bonuses, promotions, or other positive recognition.
Answer, p. 394
10. Why and how are leadership styles affected by national culture?
Leadership styles are affected by national culture because cultures have different values, requiring leaders to act differently. For example, the pursuit and recognition of individual achievement accepted in the U.S. would not be accepted well in Asian cultures. There are also forces, such as the spread of industrialization, that make values such as cooperation and dependability more similar across cultures.
Answer, p. 397
CHAPTER 12
REVIEW QUESTIONS
1. Define motivation and the components that determine it in organizations.
Motivation is the set of forces that energize, direct, and sustain behavior. The components that determine it in organizations are characteristics of the individual, characteristics of the job, and characteristics of the work situation.
Answer, p. 412
2. Differ between content and process theories of motivation and give an example of each.
Content theories focus on what needs a person is trying to satisfy and what features of the work environment seem to satisfy those needs. An example of a content theory is Maslow’s Hierarchy of Needs. Process theories focus on how different variables can combine to influence the amount of effort put forth by employees. An example of a process theory is Adam’s Equity Theory or Vroom’s Expectancy Theory.
Answer, p. 414
3. List the levels of Maslow’s hierarchy sequentially and give an example of each.
The five needs in Maslow’s Hierarchy are: Physiological Needs such as food, clothing, and shelter; Security or safety needs such as the need for protective clothing or equipment in the workplace; Social belonging is the need to be part of a group; Esteem needs are those for a sense of self-worth, competence, and recognition of it by others; Self-actualization is the need to develop one’s own competence and unique capabilities through advancement and development activities.
Answer, pp. 415-418
4. What did Alderfer contribute to motivation theory?
Alderfer added to Maslow’s Hierarchy the idea that more than one level of need can be active at one time, that a lower level need not be completely satisfied before higher level needs emerge, and that if frustrated in reaching a higher level need, a person may revert to a lower level need.
Answer, pp. 417-418
5. What is the difference between motivators and hygiene factors according to Herzberg?
Motivators are intrinsic factors related to doing the job that can increase job satisfaction. Hygiene factors are extrinsic elements associated with conditions surrounding the job that can prevent dissatisfaction, but which will not increase satisfaction.
Answer, pp. 420-421
6. What are the components of the Job Characteristics Model and how can they be used by managers?
The components of the Job Characteristics Model are core job characteristics such as skill variety, task identity, task significance, autonomy and feedback, the critical psychological states they create, and the outcomes that result. Managers can use this model to design jobs that have more of the desired core dimensions to increase worker satisfaction and effort.
Answer, p. 422
7. What is the equation developed by Vroom in Expectancy Theory?
The equation developed by Vroom in Expectancy Theory is
Effort = (E( P) x (P( O) x V
Effort is equal to the expectancy that Effort will lead to good Performance times the expectancy that high Performance will lead to desired Outcome times the Valence or value that a person attaches to the Outcome.
Answer, p. 426
8. List and explain the types of reinforcement that managers are able to use and give an example of each.
Positive reinforcement provides a desirable consequence to behavior, for example a supervisor receives a bonus for each day a project is completed ahead of schedule.
Negative reinforcement removes an undesirable consequence, for example management removes unpaid overtime from a supervisor’s job requirements to encourage applicants for the job.
Punishment provides an undesirable consequence for an unwanted behavior, such as docking pay for employees who are late to work.
Extinction removes a desirable consequence, such as eliminating suggestions for improvement when the person making them receives no recognition.
Answer, pp. 430, 432-433
9. What are the major social influences on motivation and how are they affected by cultural differences?
The major social influences on motivation are the immediate work group, supervisors, subordinates, and the organization’s culture. They are affected by the core values of the culture. In the U.S. the core values are competition, risk-taking, material possessions, and freedom. In Japan they are group harmony and belonging, and in Arabic countries they are reputation, family security, religious belief, and social recognition.
Answer, p. 434
10. Why is it important for managers to understand the centrality of work as they plan motivational methods for employees?
It is important for managers to understand the centrality of work as they plan motivational methods for employees because the importance of work in an individual’s life as balanced against leisure, family, and religion changes with different categories of employees and different cultures.
Answer, p. 438
CHAPTER 13
REVIEW QUESTIONS
1. How are groups and teams similar? Different?
A group is a set of people, limited in number, who have some degree of mutual interaction and shared objectives. A team is a type of group that has additional characteristics such as a high degree of interdependence, coordinated interaction, and a strong sense of personal responsibility for achieving specified group outcomes.
Answer, p. 450
2. What are the types of formal groups?
The three types of formal groups usually found in organizations are command groups, project/task forces, and committees.
Answer, p. 451
3. Why are informal groups important?
Informal groups are important because they can significantly affect the attitudes and performance of their members relative to organization groups and objectives.
Answer, p. 454
4. How does social loafing relate to group size? How can managers prevent it?
Social loafing occurs more often in large groups as members seem to assume that someone else will “carry the load”. It can be reduced by structuring group tasks so it is possible to identify individual contributions to the final result.
Answer, p. 455
5. What are the advantages and disadvantages of diverse groups?
Advantages are an increase in the quality of outputs as more ideas and opinions are available. Disadvantages are somewhat negative effects on members’ interactions with each other and the decreased frequency of communication within the group and increased outside of it.
Answer, p. 457
6. Why is it important to understand the effects of conformity in a group?
Conformity is the adherence to the group’s norms by individual members. If the level of conformity is high and the group norms support the organization’s goals, the group will have a positive effect. If the norms do not support the goals of the organization, it can have a very harmful effect.
Answer, p. 461
7. Why is it important to understand the effects of cohesion in groups?
Group cohesion can have a number of positive effects on organization goals such as increased quality and quantity of group interactions, strengthened adherence to group norms, increased effectiveness in reaching group goals, and augmented individual satisfaction with group membership. It can also have a negative effect through counterproductive norms, stifling of new ideas contrary to established norms or values, and potential decrease in inter-group cooperation.
Answer, p. 464
8. What are the factors that influence group formation?
The factors that influence group formation are organizational goals, opportunities for interaction and sharing mutual knowledge, and psychological factors such as need for social interaction, support, and status.
Answer, p. 464
9. What are the stages of group evolution and what occurs in each stage?
The stages of group evolution are Formation, Early Development, Becoming a Group, and Performing as a Team. During formation groups try to understand who is there and why, who will play which roles, and existing views and attitudes. Early development is when members learn what is expected of them, conflicts surface, and information is cautiously exchanged. Becoming a group entails the development of consensus about group issues, individual identity within the group, and its goals. As a Team, the group will be performing as a coherent entity.
Answer, p. 466
10. How can conflict affect group performance?
Task or substantive conflict can affect groups positively because it focuses on differences in courses of action and issues facing the group. Relationship conflict focuses on interpersonal conflict between group members and can be a distraction from dealing with group issues and tasks in a productive way.
Answer, p. 474
CHAPTER 14
REVIEW QUESTIONS
1. Diagram the communications model and label the four actions and five components.
Sender Receiver
Encodes message Receives message
Chooses a medium NOISE Decodes message
Sends the message May send feedback
The four actions are encoding, sending, receiving, and decoding. The five components are sender, message, medium, noise, and receiver.
Answer, p. 492
2. How does oral communication compare to written communication?
Oral communication is spoken. It has the potential for being vivid, stimulating, flexible and commanding attention. It can also be transitory and subject to interpretation. Written communication decreases the potential for misinterpretation and can be more precise. It can be inflexible, easier to ignore, and precision can be lost in translation.
Answer, p. 493
3. How does media richness affect the choice of media in sending a message?
Media richness affects the choice of media in sending a message because the richer it is, the more it facilitates shared meaning.
Answer, p. 495
4. Differentiate between upward, downward, and lateral communication and give an example of each.
Upward communication is sent from lower organization levels to higher, such as a request for an increased budget. Downward communication is sent from higher to lower levels of the organization, such as a policy on equal employment opportunity. Lateral communication occurs between essentially equivalent levels of an organization such as a purchase order from the manufacturing group to purchasing.
Answer, p. 498
5. List three messages which should be communicated formally and three that should be communicated informally. Explain your choices.
Three messages that should be communicated formally are new policies that comply with Federal laws, changes in pay or promotion, and performance appraisals because they should not be ignored, should be retained for future reference, and must be harder to misinterpret. Three messages that can be sent informally would be information about an interest group get-together after work, the menu in the cafeteria, or information about reserved parking spaces as a reward. These messages are about transitory events, affect informal groups, or can be used to create positive incentives quickly.
Answer, p. 499
6. Why is it important to understand the communication networks in an organization?
The importance of communication networks to managers is that they provide significant and regular sources of information, both formal and informal, that would take much longer if the links had to be re-established every time. They also provide opportunities for influencing others.
Answer, p. 501
7. List and explain the three types of barriers to communication.
The three types of barriers to communication are 1) Interpersonal, which can occur between individuals or groups because of selective perception individual differences, emotion, language or non-verbal cues; 2) Organizational, which occur between individuals or groups within or outside of the organization and can be caused by hierarchy or functional barriers; 3) Cultural, between individuals or groups in different organizational groups with different national cultures, from different organizational cultures, or diverse cultural backgrounds within an organization. They are caused by language, high/low context culture, stereotyping, ethnocentrism, and cultural distance.
Answer, p. 503
8. How does communication differ between high-context and low-context cultures?
Communication differs between high-context and low-context cultures in that high- context cultures will have more and greater adjustments in messages, the rank of the receiver will probably affect the message and the medium, nonverbal cues will be very important, and the medium may be as important as the message. Low context cultures have fewer adjustments, rank is less important, and the message is more important than the medium.
Answer, p. 505
9. How can managers overcome communication barriers?
Managers overcome communication barriers by improving their listening and sending skills and by understanding the culture and communications systems within which they work.
Answer, p. 508
10. Describe each of the stages in the negotiating process and explain how each can be affected by culture.
1) Planning and preparation involves background research, planning of strategy and tactics, objectives and what can or cannot be conceded. Japanese managers are likely to spend more time than Americans on preparation.
2) Relationship building between parties is “non-task time” during which each side attempts to establish comfortable working relationships with the other. Americans tend to make this brief, but other cultures such as Asia, the Middle East, and Latin America take a lot longer.
3) Information exchange is when each party attempts to learn the needs and demands of the other. U.S. managers tend to be direct and hurry through this stage, while Asians, Arabic, and especially Latin American cultures take a more indirect, drawn out, and thorough approach.
4) Persuasion attempts to modify the position of the other party and influence them to accept yours. American managers tend to use assertive and straightforward efforts, occasionally threats or warnings to force agreement. Arabic managers may do so also, but are less hurried. Asians are slower, more indirect, and will delay rather than threaten. Latin Americans use a mix of tactics, but also resort to delay when it is helpful.
5) Concession/Agreement is where, when parties are close to agreement, compromises and concessions are made to allow each party to take away something of value. Americans, having started closer to their real positions, have less “wiggle room” than those from Arabic and Latin American countries. Asians often employ normative appeals such as “it is your obligation” to get concessions.
Answer, p. 511
CHAPTER 15
REVIEW QUESTIONS
1. List the key activities involved in HRM.
The key activities involved in HRM are planning, job analysis, recruiting, selecting, socializing and training, job design, performance appraisal, compensation, and development.
Answer, p. 527
2. How would you describe the strategic importance of HRM in developing competitive advantage?
Strategies cannot be implemented without human resources capable of carrying them out. What’s more, executives today are aware that the unique capabilities of the people who work for them are hard to copy, one of the sources of competitive advantage that adds value for customers.
Answer, p. 527
3. What is the purpose of job analysis?
Job analysis is the determination of the scope and depth of jobs and the requisite skills, abilities, and knowledge that people need to perform their jobs successfully. The data and insights that come from job analysis are typically used to create a job description and job specification.
Answer, p. 529
4. Classify the methods of recruitment listed into internal and external activities.
Internal activities include job postings, performance appraisals, and internal referrals. External recruiting includes advertisements, employment agencies, school placement centers, and the Internet.
Answer, p. 529-532
5. Why is it important for selection techniques to be valid?
A valid selection technique differentiates between those who would be more successful on the job and those who would be less successful. It also provides legal defense in case of a challenge on the basis of discrimination.
Answer, p. 533
6. What are the methods that can be used to select the best candidates from a pool of applicants?
Assessment centers that use a combination of testing, sampling, and interviews, work simulations, written tests, background and reference checks, and physical examinations.
Answer, p. 533-535
7. What is the difference between orientation and training?
Orientation provides a broad view of the industry, the company, and its business activities and general information about working for the company such as policies, procedures, procedures, and fringe benefits.
Answer, p. 536
8. Why is performance appraisal important to an organization? to its employees?
Performance appraisal is important to an organization because it gives managers the opportunity to evaluate employee performance against an established standard. It provides employees with feedback about their level of performance, whether or not they are meeting the objectives set, and what they must do to meet a standard.
Answer, p. 539
9. How can an organization use compensation systems to motivate employees?
Compensation systems can be used to motivate employees through equitable pay structures that support and reward meeting organization objectives. They include pay, incentive programs, and fringe benefits.
Answer, p. 544-545
10. Give three examples of problems that can be created by diversity and how you would resolve them.
Examples of problems that can be created by diversity are communication problems and misunderstandings, mistrust, conflict and incompatible approaches to problem solving, lower group cohesiveness and greater subgroup formation based on elements of diversity. Managers can overcome these by knowing their own levels of comfort and experience with those different from themselves by preparing themselves and their employees through training in conflict management; listening skills, negotiation, and communication; and providing support to minority employees, and by guiding behavior.
Answer, p. 551
CHAPTER 16
REVIEW QUESTIONS
1. What is meant by control in organizations and why is it important?
Control involves the regulation of activities and behaviors in organizations to bring conformity to specifications or objectives.
Answer, p. 568
2. How are planning and controlling linked?
Planning sets an organization’s goals and controlling determines whether they have been achieved. Controlling provides the feedback to determine whether the goal has been reached and why or why not.
Answer, p. 569
3. Diagram and label the control process.
(--------------------------------------------------
PLANNING ---------
CONTROL------FEEDBACK--( CHANGES
ORGANIZING------
(----------------------------------------------------
Answer, p. 570
4. Define standards and explain why they are important to an organization.
Standards are performance targets that start at the top of the organization and filter down through each level as appropriate for the responsibilities they have for carrying out the goals and objectives of the organization.
Answer, p. 570-571
5. Who should set standards?
Standards should be set with the participation of those who will carry them out because they will be more committed to carrying them out and because they understand what will be appropriate.
Answer, p. 571-572
6. Explain strategic, tactical, and operational controls and give an example of each.
Strategic controls determine whether the organization is meeting its long-range objectives and its fit with the external environment. Strategic controls are difficult because of the dynamic environment and broad nature of strategic goals, but an example would be “being Number 1” in a given industry. Control would be to determine if that has been achieved. Tactical controls include assessment and regulation of day to day functions of the major units of an organization such as financial controls and budgets. Operational controls assess and regulate the specific activities and methods an organization uses to produce goods and services. Assembly line inspection is an example of operational controls.
Answer, p. 577
7. How does the external environment affect strategic controls?
The external environment affects strategic controls because different industries have more or less turbulence, change occurs more or less rapidly depending on innovations in the overall environment, and because long-range goals are vague and shifting.
Answer, p. 578
8. What is the difference between strategic and budgetary controls?
Strategic controls are those relating to the broad mission and vision of an organization. They may be difficult to quantify. Budgetary controls are sometimes considered to be elements of a strategic system. However they are a significant tactical control because they cover a relatively limited time frame, focus exclusively on one type of objective, and usually cannot be used to compare a total organization’s progress to its competitors.
Answer, p. 583
9. Explain the difference between bureaucratic controls and clan controls. Describe a situation in which each would be useful.
Bureaucratic controls stress adherence to rules and regulations and are imposed on workers by others. They are useful when there is a strong reliance on legitimate authority and work is highly structured. Clan controls emphasize consensus and shared responsibility for meeting goals. Clan control is appropriate in small organizations where there are shared values understood by all.
Answer, p. 586
10. Name the type of operational control used in each stage of the production process and give an example.
Precontrols are used before the production process begins to monitor the quality, quantity, and other characteristics of inputs. Concurrent controls are used to evaluate the conversion process as it occurs, such as identifying a defective part as soon as it is made. Postcontrols inspect completed products for quality and conformity to standards after they are completed.
Answer, p. 589
CHAPTER 17
REVIEW QUESTIONS
1. What are the external forces that cause change within an organization?
The external forces that cause change within an organization are economic, technology developments, legal/political developments, societal and demographic shifts, and competitors’ actions.
Answer, p. 607
2. What are the internal forces that cause organizational change?
The internal forces that cause organizational change are managerial decisions and employee preferences and suggestions.
Answer, p. 610
3. What are the six internal components of an organization that can be changed?
The six internal components of an organization that can be changed are technology, shared values and culture, strategy, structure, systems, and staff.
Answer, p. 611
4. Why is it difficult to change an organization’s culture?
It is difficult to change an organization’s culture because traditions and accepted ways of doing things are deeply embedded in an organization. Values, the underlying essence of the culture, are most difficult to change because they have evolved over time and are part of the basic fabric of the organization.
Answer, p. 614
5. Is proactive or reactive change better for the organization?
Proactive change is more effective because it can be planned further in advance, allows more control and time to adjust, and spreads the costs of change over a longer period.
Answer, p. 616-617
6. What are the choices that managers face in implementing change?
The choices that managers face in planning change are: timing, building support, communication, participation, and incentives. Considerations managers have in implementing change are choice of focus, choice of amount, choice of frequency, and choice of rate.
Answer, p. 621
7. Why do employees resist change and how can this resistance be overcome?
Employees resist change because it has potential threats and risks for those affected. Resistance is caused by inertia, mistrust, lack of information, lack of capabilities, and anticipated consequences. Resistance to change can be overcome by analyzing the forces for and against it, participation in the plans for change by those affected, communication, facilitation and support, and coercion.
Answer, p. 626
8. Describe force field analysis.
Force field analysis uses the concept of equilibrium, a condition that occurs when the forces for change, the driving forces, are balanced by the forces opposing change, the restraining forces. Change will occur when the driving forces for change become greater than the restraining forces for inertia.
Answer, p. 626-627
9. What data is needed to evaluate change?
Data that is needed to evaluate change can be quantitative, such as changes in output, speed of response to customers, or accuracy of reports. It compares outcomes to predetermined goals or standards. Qualitative measures such as attitudes are more difficult to measure, but can involve feedback to supervisors, surveys, and other systems for collecting ideas.
Answer, p. 629
10. Name and explain three methods for managing change in organizations.
Three methods for managing change in organizations are organizational development, process redesign, and organizational learning. Organizational development has an emphasis on planned, strategic, long-range efforts focusing on people and their interrelationships in organizations. Process redesign, or re-engineering, involves a fundamental redesign in business processes to achieve (intended) dramatic improvements. Organizational learning is exhibited by an organization that is skilled at creating, acquiring, and transferring knowledge and at changing its behavior to reflect new knowledge and insights.
Answer, p. 630-631
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