Tb12

CHAPTER 12: ORGANIZATIONAL CHANGE AND LEARNING

Test Correlation Table Question Types/Level of Difficulty

LEARNING OBJECTIVES Easy Moderate Difficult1. Describe four types of organizational change.

TF 1, 6 2, 3, 4, 5, 7 —

MC 1, 4, 5, 9 6, 10, 11, 12, 14, 15

2, 3, 7, 8, 13, 16, 17

ES — 1 —

2. Explain the planning process for organizational change.

TF 10, 13, 15, 16, 18

8, 11, 14, 19 9, 12, 17, 20

MC 19, 22, 24, 29, 35, 37, 40, 41,

53

18, 23, 26, 27, 28, 30, 31, 33, 36, 39, 42, 46, 48, 50, 52, 54,

55, 56

20, 21, 25, 32, 34, 38, 43, 44, 45, 47, 49, 51,

57

ES 4 — 2, 3

3. Identify four methods of organizational change.

TF 26, 29, 30, 31, 36

22, 24, 25, 27, 33, 34, 35

21, 23, 28, 32, 37

MC 67, 71, 75, 78, 84, 85

59, 60, 62, 65, 68, 69, 72, 73, 76, 77, 81, 82, 86, 87, 88, 90

58, 61, 64, 66, 74, 80, 83, 89

ES — — 5

4. Describe how innovation relates to organizational change.

TF 38 39, 40, 42 41

MC 91, 95, 101 94, 96, 98, 99 92, 93, 97, 100

ES — 6 —

5. Discuss how learning organizations foster change.

TF 43, 44 46, 48, 49 45, 47

MC 102, 103, 107, 114, 115

104, 106, 108, 109, 111, 113,

116

105, 110, 117

ES — 8 7

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True/False Questions

Learning Objective 1

1. Radical change occurs when organizations make major adjustments in the ways they do business.

ANSWER: T, Knowledge, Easy, p. 325

2. The radical change model was developed by professors at the Harvard School of Business.

ANSWER: F, Knowledge, Moderate, p. 325

3. During radical change, the transitioning stage occurs between the unfreezing and the freezing stage.

ANSWER: T, Knowledge, Moderate, p. 325

4. Total Quality Management (TQM) is an approach that relies heavily on radical change.


5. Timing has very little to do with the magnitude or results of an organizational change.


6. Reactive change can be incremental or radical.


7. Incremental anticipatory change is future-oriented and results from constant tinkering and improvements.



8. Chaos is a symptom of a poorly managed organizational change.


9. For innovation and change to occur without chaos or disorder, the nine steps that constitute the basic components of a change process must be followed in their proper sequence.

ANSWER: F, Knowledge, Difficult, p. 329

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10. A roofing company that receives a large number of water damage claims is experiencing a performance gap.


11. Organizational diagnosis identifies both the nature and the extent of problems.


12. Organizations often hire outside consultants to assist with problem diagnosis because they offer expertise that the organization lacks to conduct and properly analyze employee attitude surveys.

ANSWER: T, Knowledge, Difficult, p. 330

13. Organizational diagnosis is where the need for change is articulated in describing specific measures to be used in progressing toward goals.

ANSWER: F, Knowledge, Easy, p. 331

14. Some resistance to change is good, with employees operating as a check-and-balance mechanism to ensure that management properly plans and implements change well.


15. Education, participation, and incentives are three methods used by managers to overcome resistance of employees.


16. Managers can effectively use fear tactics to eliminate the effects of vested interests.


17. Managers who initiate change are wrong if they believe that anyone with the same information would make the same decision.


18. Empowering workers by giving them some control over the change process is an effective way to reduce the stress they experience.


19. One way to reduce cynicism is to make changes take place as infrequently as possible.


20. The results of a change process are monitored typically at predetermined intervals.

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21. There are four methods of organizational change: technological, organization redesign, job redesign, and organizational development. Seldom can significant change be based on one of these methods alone.

ANSWER: T, Knowledge, Difficult, pp. 335–336

22. Structural change involves incremental changes that affect workflows, production methods, and materials.


23. Sometimes the need for organizational redesign follows directly from implementing new technologies.


24. Downsizing is a familiar approach to structural redesign.


25. Reengineering typically means reconfiguring the organization by changing the levels of authority, responsibility, and control.


26. Downsizing is a painful process but it continues to be popular because it has proven to be highly effective as a survival strategy.

ANSWER: F, Knowledge, Easy, pp. 336–337

27. Several researchers have found that restructuring is not guaranteed to work. Several studies indicate that restructured firms end up in worse financial shape after the restructuring than they were before.

ANSWER: T, Knowledge, Moderate, pp. 336–337

28. Reengineering involves redesign of an organization’s processes (e.g., logistics, distribution, and manufacturing) with the goal of designing the most effective process for making and delivering a product.


29. Job enrichment involves the scientific analysis of tasks performed by employees in order to discover procedures that produce the maximum output for the minimum input.


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30. Changing job specifications to broaden and add challenge to required tasks in order to increase productivity is called job enrichment.


31. The downside to job enrichment is that it leads to low employee commitment and high turnover.


32. Organizational development is a broad term that refers to several different methods for creating organizational change.


33. Focus groups need to operate in an open, nonthreatening environment where there is no designated leader that can dominate and make people feel inhibited.


34. When employee surveys are designed to address issues of strategic importance, they can be used to enhance the organization’s competitive advantage.


35. Team building is more important in tall organizations with narrow spans of control.

ANSWER: F, Application, Moderate, p. 339

36. E-engineering is a reengineering initiative that uses Web-based technology.


37. Installing ERP software is considered an incremental change.

ANSWER: F, Application, Difficult, p. 340


38. Innovation is just another name for change.


39. Innovation and change are more important environmental elements for new organizations than for established organizations.


40. Three basic types of innovation are technical, process, and administrative.

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41. Convergence and implementation are basic types of innovation.


42. Offering telecommuting to employees is an example of an administrative innovation.



43. A learning organization is one that sees changes and innovations as a part of a daily routine.


44. Learning organizations have the distinction of being customer-focused.


45. As a result of providing a culture of innovation within the organization, Continental Airlines created and was the first to use electronic ticketing in airline travel.


46. The flat, team-based structure found in learning organizations facilitates learning more than a vertical organization.


47. Knight-Ridder’s long-term perspective led it to successfully enter broadcast journalism.


48. Xerox hired an anthropologist to study the ways the firm’s workers went about their jobs.


49. Scanning the environment includes the observation of tacit knowledge or gossip.


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Multiple Choice Questions

Preview1. When Bill Zollars started his survival campaign to make the necessary changes at

Yellow Freight, all of the following had recently happened except __________.a. deregulation of the trucking industryb. company losses of $30 millionc. two rounds of layoffsd. a major strike by the teamsters union

ANSWER: A, Knowledge, Easy, p. 324

2. Yellow Freight employees now have adequate __________ to enable them to solve problems and assess the performance of their company.a. motivationb. informationc. incentivesd. all of the above

ANSWER: B, Knowledge, Difficult, p. 324 Learning Objective 1

Types of Organizational Change

3. All of the following are considered types of organizational change except __________.a. fast-paced accrual changeb. incremental anticipatory changec. incremental reactive changed. radical reactive change

ANSWER: A, Knowledge, Difficult, p. 327

4. __________ change refers to any transformation in the design or functioning of an organization.a. Restructuringb. Redesigningc. Organizationald. Incremental

ANSWER: C, Knowledge, Easy, p. 324

5. A(n) _______ change occurs when organizations make major adjustments in the ways they do business.a. organizationalb. incrementalc. radicald. redesigning


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6. All of the following are true concerning radical change except __________.a. it occurs relatively infrequentlyb. adopting a new organizational structure is an examplec. it generally takes a short time to implement d. it can be stimulated by changes in the environment

ANSWER: C, Knowledge, Moderate, p. 325

7. All of the following correctly describe the common framework for radical organizational change except __________.a. the framework was developed by social scientist Kurt Lewinb. the model divides the change process into four stagesc. stage 1 is referred to as “unfreezing”d. the change is solidified in the “refreezing” stage

ANSWER: B, Knowledge, Difficult, p. 325

8. Monitoring the intended outcomes and providing support for new behaviors are completed in what stage of radical organizational change?a. freezingb. refreezingc. transitioningd. none of the above


9. __________ change is an ongoing process of evolution over time, during which small changes occur routinely.a. Incrementalb. Radicalc. Transitory d. Anticipatory

ANSWER: A, Knowledge, Easy, pp. 325–326

10. TQM (total qualify management) relies heavily on what type of organizational change?a. radicalb. incrementalc. anticipatoryd. none of the above

ANSWER: B, Knowledge, Moderate, p. 326

11. The degree and ________ of change combine to form different types of change.a. severityb. depthc. timingd. consequence


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12. What type of change occurs when an organization is forced to change in response to some event in the external or internal environment?a. anticipatoryb. large-scalec. evolutionaryd. reactive

ANSWER: D, Knowledge, Moderate, p. 326

13. General Electric managers are encouraged to make __________ through Work-Out sessions.a. reactive changeb. anticipatory changec. incremental changed. both a and c

ANSWER: D, Knowledge, Difficult, p. 327

14. Reactive change can be incremental or radical. What company’s share price fell 50 percent in 6 months after the CEO attempted to make a radical reactive change instead of radical incremental change?a. Prudential b. Citibankc. AT&Td. P&G


15. What type of change occurs when managers make organizational changes in advance of upcoming events or early in the cycle of a new trend?a. anticipatoryb. reactivec. radicald. incremental

ANSWER: A, Knowledge, Moderate, p. 328

16. Davis Owen has just administered questionnaires (like the one in your textbook) to each of his employees concerning how they respond to innovation and change. Over 80% of his employees received a score more than 9. What can Davis conclude from this new information?a. His employees would be most comfortable in a traditional environment.b. They will enjoy working in an organization that offers cutting-edge products or

services.c. They are unlikely to create changes in the organization.d. They do not see how change can improve performance.

ANSWER: B, Application, Difficult, pp. 328–329

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17. Ramona Chavez has just completed the self-management competency questionnaire and has determined from her score that she would work well in an organization that makes changes fast. Despite her overall high score however, her supervisor is concerned about a response she gave on one of the questions. Which question and response indicates she may prefer an organization that makes changes more slowly?a. She seldom follows rules that she think are silly or ineffectiveb. She will have a new job in five years that she can’t even imagine yetc. She believes she would prefer a job that she can master and become a real expert

at doingd. She enjoys trying news foods, even if she isn’t sure of the ingredients

ANSWER: C, Application, Difficult, pp. 328–329


Planning for Organizational Change

18. The process of planned organizational change comprises a series of steps. The first step is to __________.a. follow-up the changeb. assess the environmentc. diagnose organizational problemsd. identify sources of resistance


19. All of the following are components of organizational change except for __________.a. assessing the environmentb. reducing the resistancec. diagnosing organizational problemsd. All of the above are components of organizational change.

ANSWER: D, Knowledge, Easy, p. 329

20. Of the environmental factors listed, which is the least responsible for stimulating organizational change?a. customersb. technologyc. unionsd. workforce

ANSWER: C, Knowledge, Difficult, p. 330

21. Of the environmental factors listed, which is the most responsible for stimulating organizational change?a. globalizationb. technological advancesc. actions of important stakeholdersd. competitors


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22. Marriott Hotels and Bank of America use __________ and other forms of market research to assess customers’ preferences.a. customer satisfaction surveysb. “whack-o-meter” sessionsc. performance appraisalsd. diagnostic methods


23. Ed Zander, president of Microsystems, Inc., used __________ to assess the competitive marketplace.a. performance appraisalsb. customer satisfaction surveysc. “whack-o-meter” sessionsd. diagnostic methods


24. The __________ is the difference between what the organization wants to do and what it actually does.a. conversion system b. codifying valuesc. performance gapd. behavioral displacement


25. Whalen Industries is going through a planned process for organizational change. They have already analyzed the environment and they should now ___________.a. get feedback from the environmentb. determine the difference between what the organization aspires to do to take

advantage of its opportunities and what it actually doesc. determine all new technical breakthroughsd. none of the above

ANSWER: B, Application, Difficult, p. 330

26. The aim of the __________ step in the planning process for organizational change is to identify the nature and extent of problems before taking action.a. communication b. refreezing c. assessmentd. organizational diagnosis


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27. The HR director at Food Ingredient Specialties used __________ to encourage employees to creatively analyze company problems.a. motivational speakersb. videosc. musicd. all of the above


28. The fourth step in planning for organizational change is:a. diagnosis of organizational problems.b. articulating and communicating a vision.c. anticipate resistance.d. There are no steps to organizational change.


29. Bill Zollar communicated his vision for Yellow Freight Systems by:a. announcing the vision in memos.b. publishing the vision in employee newspapers.c. taking an 18-month road trip.d. taking out a display ad in the Wall Street Journal.


30. The fifth step in planning for organizational change is:a. develop and implement an action plan.b. determine the performance gap.c. assess the environment.d. diagnose organizational problems.


31. An action plan provides all of the following except __________.a. articulation of the goals for changeb. describes the specific measures to be used to monitor progressc. describes specific measures to be used to evaluate progress toward those goalsd. An action plan provides all of the above.


32. The text mentioned all of the following alternatives to layoffs except __________.a. reducing hoursb. reducing payc. encouraging leaves of absenced. getting rid of part-time workers


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33. What is the best way to assure that a plan for organizational change will be implemented?a. involve employees early in the processb. correctly diagnose the problemc. empower a task force to implement the changed. prioritize short-term goals over long-term goals.


34. As one of the world’s largest companies with 101,000 employees and $128 billion in annual revenues, size could not protect Royal Dutch/Shell from __________.a. the World Trade Organizationb. European hypermarketsc. price shocks in the oil marketsd. environmental threats


35. Royal Dutch/Shell needed a more fundamental change than downsizing. One of the major challenges that were identified was __________.a. making its prices more competitiveb. achieving consistent brand recognition internationallyc. boosting retail outlet salesd. inefficient use of its refinery capabilities


36. Steve Miller, managing director of Royal Dutch/Shell, is convinced that creating change is __________.a. a top-down taskb. a bottom-up taskc. the most essential activityd. an unending cycle


37. For change to be effective, __________ should be set before the change effort is started. a. reasonsb. rewards c. guaranteesd. goals


38. Phillip French is setting goals for his organization. For change to be effective, goals should incorporate all of the following except __________.a. be based on realistic objectivesb. be stated in clear and measurable termsc. be consistent with the organization’s policies

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d. all of the above

ANSWER: D, Application, Difficult, p. 33239. Step six in the process of organizational change is:

a. assess the environment.b. determine the performance gap.c. develop a strategic plan.d. anticipate and reduce resistance.


40. Experienced managers are aware of all the following forms of resistance to change mentioned in the chapter except __________.a. sabotageb. silencec. lawsuitd. defiance


41. Jimmie Compton is a manager of a computer software company and is interested in implementing changes within the organization. What forms of resistance is Compton likely to encounter?a. silenceb. sabotagec. in-your-face defianced. All of the above are forms of resistance.

ANSWER: D, Application, Easy, p. 333

42. Lakisha Bullock is hoping to select the correct method of overcoming employee resistance to change. Her choices include all of the following except __________.a. educationb. participationc. feard. all are the above


43. In general, people—and sometimes even entire organizations—tend to resist change for certain reasons. Which of the following is not a typical reason to resist change?a. fearb. vested interestsc. interactivityd. misunderstandings


44. Shirley Mason, manager of Falcon Fabrication, has tried to computerize her billing department. Most employees in that department have been working for the firm for many years and don’t feel comfortable with the prospect of having to deal with computers. Mason is likely to encounter resistance to her plans because of

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__________.a. fear of the unknown b. vested interestsc. interorganizational agreementsd. limited resources

ANSWER: A, Application, Difficult, p. 333

45. Mercedes-Benz Credit Corporation set out to restructure its operations in the United States by instituting all of the following except:a. offered the security of a new job to anyone bold enough to eliminate his or her

current position.b. reminded employees that fear was a normal and essential element of change.c. eliminated four layers of management as a result of employee recommendations.d. used financial incentives to convince employees that even cutting their own jobs

wouldn’t hurt them.


46. Howard Chamberlain has been resisting change within his organization because he feels that he is unable to develop the new skills and behaviors required of him. Howard is experiencing __________.a. fear of the unknownb. cynicism c. competitiond. vested interests

ANSWER: A, Application, Moderate, p. 333

47. Fear often goes hand in hand with __________.a. misunderstandingsb. cynicismc. vested interestsd. technological change


48. Individuals within organizations may become resistant to change if they believe that it conflicts with their own self-interests. This resistance is usually based on _________.a. fear of the unknown b. vested interests c. misunderstandingsd. cynicism


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49. Prudential communicated the implications of its change policies through the use of a board game similar to Monopoly in order to alleviate negative effects that might be caused by __________.a. misunderstandingsb. fearc. vested interestsd. cynicism


50. Katie Schroeder is very resistant toward any change. Her manager knows that getting employees to discuss their problems openly is crucial to overcoming resistance to change. What is Schroeder’s manager trying to resolve? a. fear of the unknownb. vested interest c. misunderstandingd. interorganizational disagreement

ANSWER: C, Application, Moderate, p. 334

51. Kasey McLaughlin’s subordinates are resisting his “Quality is #1” campaign because they think it is just another management fad. In order to succeed with the program, Kasey will need to eliminate __________.a. the leader of resistanceb. fear of the unknownc. cynicismd. misunderstandings

ANSWER: C, Application, Difficult, p. 334

52. Mark Morgan’s plan to implement organizational change was met with rumblings from his employees that he was trying to get promoted to administrative vice president. Morgan’s changes may not succeed because of his employees’ __________. a. misunderstandingb. cynicismc. feard. impatience

ANSWER: B, Application, Moderate, p. 334

53. In the __________ step, managers monitor the results of the change process.a. initial b. search c. finald. identification


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54. The final stage of planned organizational change is __________.a. diagnosis of organizational problemsb. identification of sources of resistancec. plan the next cycle of changed. monitor change


55. Jeanine Yates has initiated and implemented many changes in her workplace. Some have been successful, and others have not. Yates must understand that the ability to sustain and make change work depends primarily on ___________.a. the ability to terminate poor workers after change has been madeb. the skill of the change initiatorc. how well the organization monitors reactions and improvements after the change

effortd. the skills and abilities of the employees involved in the change

ANSWER: C, Application, Moderate, p. 334

56. Carol Bernick believed the best way to change Alberto-Culver’s performance was to __________.a. change its marketingb. change its culturec. change its pricing structured. change the top management team


57. Alberto-Culver created growth development leaders to take part in all of the following except __________.a. performance reviewsb. one-on-one mentoringc. communicating the family friendly benefitsd. meeting and communicating with the CEO



Implementing Change58. Sabrina Neely has been very involved with incorporating planned organizational

change. In fact, she has already assessed the environment, determined the performance gap, diagnosed organizational problems, identified sources of resistance, reduced those sources of resistance, and developed a method to monitor organizational change. Sabrina must next __________.a. follow-up on the goalsb. search for approaches to changec. implement the changed. reassess the environment

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59. There are four methods of organizational change that include all of the following except __________.a. job redesignb. organization redesignc. environmental changed. technological change


60. __________ comprises complex networks of computer, telecommunications systems, and remote-controlled devices.a. Information technologyb. Inventory managementc. Network designd. Infrastructure management


61. Deluxe Electronics can link its manufacturing and inventory functions so that as soon as the system runs low on a part, a central computer automatically executes an electronic purchase order signaling the supplier to ship new parts. Deluxe is effectively utilizing __________.a. a warehouse control systemb. information technologyc. just-in-time technologyd. interval schedules


62. At Wal-Mart, the electronic cash register monitors the goods sold, their prices, and the amounts remaining on hand. If the inventory of an item is low, the system sends the message to the appropriate distribution center and a reorder is placed. What approach to implementing change is Wal-Mart using?a. technological changeb. organization Redesign c. organization developmentd. none of the above


63. Kristina Falk has noticed that her plant needs improvement when it comes to workflows and production methods. The change that Kristina should initiate is a __________.a. conceptual framework strategyb. organization redesignc. organization developmentd. technological change


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64. Regardless of the type of redesign selected, the intent is usually to clarify what gives the organization its __________.a. technological superiority b. leadership position with customers c. maximum efficiencyd. best possible profitability


65. As Mellon Bank’s customers became more comfortable using ATMs, the bank found that it needed 30 percent fewer branches. The remaining branches were changed by what method?a. organization redesignb. technological changec. job redesignd. a combination of the above


66. Which of the following statements is true concerning the organization redesign method?a. One basic approach to organizational design is changing the organization’s

processes.b. The intent of redesigning organizations is to clarify what gives the organization its

leadership position with its customers.c. Design changes should capitalize on the capabilities that differentiate the

organization from its competitors.d. All of the above are true.


67. Managers are being bombarded by ideas on how to redesign their organizations to improve customer satisfaction. These recommendations include all of the following except __________.a. redesigning b. downsizing c. reengineeringd. reformation

ANSWER: D, Knowledge, Easy, pp. 336–337

68. __________ typically means reconfiguring the distribution of authority, responsibility, and control in an organization.a. Streamliningb. Standardizationc. Restructuringd. Re-aligning


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69. In 1994, Sears, Roebuck, & Company sold off interests in insurance, real estate, and finance to focus on its core competency of merchandising. Sears was thereby __________.a. simplifying b. restructuringc. re-shufflingd. resisting change

ANSWER: B, Application, Moderate, p. 336

70. What approach to structural redesign is known to be used as a response to poor organizational performance, is seldom effective in the long run, and presents a painful experience to those who endure the process?a. reengineeringb. downsizingc. job simplificationd. job creation

ANSWER: B, Knowledge, Moderate, pp. 336–337

71. __________ has to do with changing the processes by which work is carried out.a. Feedback control b. Reengineering c. Ingenuityd. Standardization

ANSWER: B, Knowledge, Easy, p. 337

72. Donovan Feldman has been involved in reengineering his organization. He is redesigning the organization’s processes to ensure __________.a. lower costs b. better qualityc. increased speedd. All of the above may result from reengineering.

ANSWER: D, Application, Moderate, p. 337

73. When organizations want to improve their efficiency and the quality of their products and services, they often examine their __________.a. internal production processesb. focus group resultsc. acquisition of resourcesd. all of the above

ANSWER: A, Knowledge, Moderate, 337

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74. By __________ its insurance claims processes, National Grange Mutual was able to reduce its response time by 55 percent.a. redesigningb. restructuringc. reengineeringd. streamlining


75. __________ involves the scientific analysis of tasks performed by employees in order to discover procedures that produce the maximum output for the minimum input.a. Job enrichmentb. Job simplificationc. Job redesignd. Job empowerment


76. The oldest task approach to change is __________.a. job enrichmentb. job simplificationc. job empowermentd. job deployment


77. Fast-food restaurants most likely use __________. They use this design because their employees can learn tasks rapidly, they have short work cycles, and low-skilled and low-paid employees can be trained easily.a. team-based structuresb. tangible outputsc. situation analysis leadershipd. job simplification

ANSWER: D, Application, Easy, p. 337

78. At “Toys for Tots,” specific jobs were changed with the intent of broadening and adding to the challenge of the tasks required. Productivity improved due to the company’s __________ approach to change.a. trend line b. job rotationc. job enrichmentd. job engineering

ANSWER: C, Application, Easy, p. 338

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79. Beth Hayden has been attempting to increase productivity through job enrichment. Job enrichment encompasses all of the following unique aspects except:a. employees are likely to develop attitudes that support the new job-related behaviors.b. job enrichment can humanize an organization.c. employees become more involved and more satisfied.d. All of the above are aspects of job enrichment.

ANSWER: D, Application, Moderate, p. 338

80. All of the following are true regarding job enrichment except:a. it changes the basic relationship between employees and their work.b. it changes employee behaviors in ways that gradually lead to more positive attitudes

about the organization.c. it offers opportunities for initiating other types of organizational change.d. promotes social loafing within the organization.


81. Amelia Rash is studying various approaches to organizational change. She should use a(n) __________ approach if she needs a long-range strategy for developing her workforce and improving their effectiveness.a. organization developmentb. organization redesignc. reactived. radical


82. __________ is a planned, long-range behavioral science strategy for understanding, changing, and developing an organization’s work force in order to improve its effectiveness.a. Survey feedback b. Organization developmentc. Team buildingd. Behavior modification


83. Organization development (OD) has three most commonly used methods for achieving organizational change. All of the following are included except __________.a. focus groupsb. information systemsc. team buildingd. survey feedback


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84. __________ is an organization development (OD) method that allows managers and employees to report their thoughts and feelings about the organization and to learn about how others think and feel about their own behaviors.a. Survey feedback b. Semantics trainingc. Team buildingd. Reorientation


85. Survey feedback is obtained by means of a __________.a. questionnaireb. portfolioc. PERT chartd. GANTT chart


86. Intel conducted a survey of its 85,000 employees using a(n) __________ method.a. Web-basedb. ERPc. pen and paperd. both a and c


87. Lonnie Hadley is a human resources manager for the credit card division of First USA. He has decided to initiate some team building activities which might include all of the following except __________.a. emphasis upon a trust-based environmentb. outdoor adventuresc. competitive gamesd. creativity exercises

ANSWER: C, Application, Moderate, 339

88. ___________ is a description of reengineering initiatives that use Web-based technology as the primary method for managing business-to-business processes.a. E-engineeringb. E-commercec. E-generationd. E-digitalizing


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89. The installation of ERP software at Fairchild Semiconductor was a radical change that created all of the following results except:a. it replaced all the business processes throughout the company.b. it allowed significant workforce reductions.c. it created “plain vanilla” processes that fit the generic software system.d. employees became more knowledgeable and excited about their roles in the

company.

ANSWER: B, Knowledge, Difficult, pp. 340–341

90. Fairchild Semiconductor implemented an ERP application from Peoplesoft. A key step was to educate users on how their own work was related to the overall process so that the workers might __________.a. save training timeb. make the purchase decision appear worthwhilec. be committed to fully using the new systemd. not request pay raises for the extra work

ANSWER: C, Knowledge, Moderate, pp. 340–341


Role of Innovation in Organizational Change91. __________ is the process of creating and implementing a new idea.

a. Changeb. Strategyc. Innovationd. none of the above


92. Kodak’s lack of innovation caused all of the following except __________.a. profits plummetedb. 34,000 workers were laid offc. the CEO was firedd. all of the above


93. Which of the following is not considered a basic type of innovation?a. technical innovationb. process innovationc. behavioral innovationd. All of the above are types of innovation


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94. Susan Tillery’s organization Silk Flowers, Inc., has created and adopted a substantially new method of producing silk flowers. This is an example of what type of innovation?a. process b. organizational c. administrative d. technical


95. The shift to wireless communications systems represents what type of innovation?a. processb. administrativec. technicald. production

ANSWER: C, Knowledge, Easy, pp. 341–342

96. The introduction of do-it-yourself online stock trading represents what type of innovation?a. environmentalb. technicalc. productiond. process


97. At Toyota, oobeya was a process innovation that enabled the company to __________.a. produce more futuristic automobile designsb. maintain the perfect inventory levels at dealersc. build cars with almost no workersd. dramatically lower production costs


98. All of the following are examples of administrative innovation except __________.a. flexible work schedulesb. telecommutingc. e-commerced. virtual organizations


99. Champion International was a traditional __________ company that followed technical innovations and moved higher in Fortune’s listings for six consecutive years.a. spark plug manufacturingb. chemical c. food serviced. paper manufacturing


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100. Champion International made all of the following changes as a result of technical innovations except __________.a. major investments in technical skills trainingb. in-house manufacturing of its state-of-the-art equipmentc. restructured 10 of its 11 millsd. changed management structure from hierarchical to team-based


101. An architecture for innovation builds an infrastructure that encourages innovation and change. All of the following are key features of that architecture except __________.a. developing a learning environmentb. fostering workforce resiliencec. providing a support system for innovationd. all of the above



Learning Organizations 102. A(n) __________ organization has both the drive and the capabilities to improve its

performance continuously.a. progressive b. redesignedc. innovatived. learning


103. Which of the following are learning organizations least likely to learn from?a. past experiencesb. textbooksc. other companiesd. customers


104. All of the following are considered distinctive features of learning organizations except __________.a. shared leadershipb. intensive use of informationc. hierarchical chain of commandd. organic organization design


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105. Management of Nantucket Nectars encourages employees to learn by allowing them to make mistakes. Managers believe this will result in __________.a. lower worker turnoverb. better quality beveragesc. better financial performance in the long rund. another product breakthrough


106. Which company first implemented an employee’s innovative idea of electronic plane tickets?a. Southwest Airlinesb. Continental c. People Expressd. British Airways


107. When people feel they are part of a community, they are more willing to __________.a. share solutions to problems with their coworkersb. find problemsc. make extra effortd. all of the above


108. Learning organizations encourage individual learning in which of the following ways?a. delegationb. empowermentc. “oobeya”d. all of the above


109. What organizational structure facilitates learning?a. flat structureb. team-based structurec. hierarchical structured. both a and b are correct


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110. Which of the following is true concerning Knight-Ridder’s purchase of Dialog Information Services?a. The purchase price was attractive so Knight-Ridder decided to make the short-term

investment.b. The new service reaches a newspaper readership audience of primarily 25 to 43

year olds.c. The acquisition of Dialog transformed the traditional newspaper company to a leader

in online business information.d. The company’s acceptance of the need for a short-term perspective was crucial for

a learning organization.

ANSWER: C, Application, Difficult, p. 346

111. The design of learning organizations emphasizes the use of all of the following except __________. a. teamsb. strategic alliancesc. boundaryless networksd. All of the above are emphasized in learning organizations.


112. In addition to experimenting on their own, many learning organizations use strategic alliances with suppliers, customers, and even competitors as a method of learning. What alliance has Amgen, a Japanese biotech company, made with Kirin Brewery?a. Alcohol intake studies helping cancer research.b. Amgen learns about the fermentation processes, which are crucial for producing

synthetic blood clotting protein.c. Kirin learns about amino-acid/protein combinations that can act as catalysts to

speed up the brewing process.d. both b and c describe the “alliance”

ANSWER: D, Application, Difficult, pp. 346–347

113. A design option for learning organizations is to become a network of cooperating units connected by a sense of community among a larger pool of people who share their diverse knowledge and expertise. What is this network design called?a. strategic allianceb. team-basedc. measurement-orientedd. boundaryless


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114. Information is the lifeblood of learning organizations. To be effective they must undertake all of the following except __________.a. extensive scanningb. be measurement orientedc. share problemsd. all of the above


115. Learning organizations are measurement oriented in their efforts to improve performance. In learning organizations, what information do employees have access to?a. customer satisfaction surveysb. market sharec. competitors’ strategiesd. All of the above should be available to employees in learning organizations.


116. Pharmaceutical companies are described in the text as good examples of learning organizations. They do all of the following except __________.a. develop new products and bring them to the marketb. rely on hierarchical structures to maintain control of the drug development processc. track the expertise of their scientists and engineersd. predict in advance the new products to be introduced


117. Xerox identified which of the following as one of its key strategic challenges?a. increasing the amount and effectiveness of soft informationb. increasing the amount and effectiveness of audit datac. consolidating the international accounting network with national standardsd. using e-mail more effectively


Essay Questions


1. Describe four types of organizational change.

Organizational changes vary in both degree and timing. In terms of degree, change can be radical or incremental. In terms of timing, change can be reactive or anticipatory. Combinations of these possibilities create four basic types of change: radical reactive change, radical anticipatory change, incremental reactive change, and incremental anticipatory change.

Moderate, pp. 325–328

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2. Explain the planning process for organizational change.

Although change often involves a bit of chaos, organizations can usually reduce its amount and impact by carefully planning for major change. Through planning, the organization begins to unfreeze and prepares for the change. The key planning activities are (1) assessing the environment; (2) determining whether a performance gap exists, and if so, its nature and magnitude; (3) diagnosing organizational problems; (4) articulating and communicating a vision for the future; (5) developing an action plan for the change; (6) anticipating and making plans to reduce resistance; and (7) developing a way to monitor change and following up after the main initiatives have been implemented.

Difficult, pp. 329–334

3. What are some ways to cut costs that will avoid the long-term negative effects of laying off workers?

a. reduce working hours for all employees rather than eliminating individualsb. encourage employees to take temporary leaves of absencec. not renewing contracts for temporary and part-time workersd. job sharinge. reduction of executive salaries and bonuses

Difficult, p. 331

4. What are four of the reasons for the resistance to change?

a. fearb. vested interestsc. misunderstandingsd. cynicism

Easy, pp. 333–334

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5. Identify four methods of organizational change.

Many approaches to implementing change are possible. Four general methods are technological change, organization redesign, job redesign, and organization development. Technological change often involves changing the way work is done by adopting new information technologies. The organization redesign method may involve changing the organizational structure and/or organizational processes. Organization redesign normally affects large portions of an organization. Downsizing and reengineering are examples of this method. Job redesign involves changing employees’ jobs, either simplifying or enriching them. Organization development can be used to change employee attitudes and behaviors. Focus groups and survey feedback permits managers and employees to provide information about a range of topics, including job satisfaction, organizational commitment, and perceptions of supervisory and managerial behaviors. Team building is used to improve the functioning of people who must work together to achieve assigned tasks. Change efforts often involve a combination of these methods.



6. Explain the relationship between innovation and organizational change.

Innovation is the process of creating and implementing a new idea. Three basic types of innovation are technical, process, and administrative. Organizational change refers to any transformation in the design or functioning of an organization. Generally, innovations require organizational change. Innovation and change are important to both new and established organizations, owing to the dynamic nature of the external environments of most organizations.

Moderate, pp. 341–343


7. Discuss how learning organizations foster change.

Organizations are redesigning themselves to become learning organizations capable of quickly adapting their practices to satisfy the needs of their customers. The basic features of such organizations are leadership that is shared, a culture that supports innovation, a strategy focused on customers, an organic organization design, and an intensive use of information. In a learning organization, change is not a special event; it’s a natural part of the organization’s continuous attempts to satisfy customers.


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8. Describe how information is effectively used in the learning organization.

Learning organizations aggressively scan both the internal and external environments for information. They do not want to miss an important trend or change. Information is essential to judgements relating to the creation of new products and services. Systematic measurement is used to make these improvements possible. This includes data pertaining to profits, customer satisfaction, and competitors’ strategies. The learning organization gathers data and disseminates it internally. In addition to numerical data is “soft” information that may be gathered through anecdotal evidence. This can speed up the process of organizational learning.

Moderate, p. 347

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