Tb12

CHAPTER 12: ORGANIZATIONAL CHANGE AND LEARNING
Test Correlation Table Question Types/Level of Difficulty

LEARNING OBJECTIVES Easy Moderate Difficult
1. Describe four types of TF 1, 6 2, 3, 4, 5, 7 —
organizational change.

MC 1, 4, 5, 9 6, 10, 11, 12, 14, 2, 3, 7, 8, 13, 16,
15 17

ES — 1 —

2. Explain the planning process TF 10, 13, 15, 16, 8, 11, 14, 19 9, 12, 17, 20
for organizational change. 18

MC 19, 22, 24, 29, 18, 23, 26, 27, 20, 21, 25, 32,
35, 37, 40, 41, 28, 30, 31, 33, 34, 38, 43, 44,
53 36, 39, 42, 46, 45, 47, 49, 51, 57
48, 50, 52, 54,
55, 56

ES 4 — 2, 3

3. Identify four methods of TF 26, 29, 30, 31, 22, 24, 25, 27, 21, 23, 28, 32, 37
organizational change. 36 33, 34, 35

MC 67, 71, 75, 78, 59, 60, 62, 65, 58, 61, 64, 66,
84, 85 68, 69, 72, 73, 74, 80, 83, 89
76, 77, 81, 82,
86, 87, 88, 90

ES — — 5

4. Describe how innovation TF 38 39, 40, 42 41
relates to organizational
change.

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

ES — 6 —

5. Discuss how learning TF 43, 44 46, 48, 49 45, 47
organizations foster change.

MC 102, 103, 107, 104, 106, 108, 105, 110, 117
114, 115 109, 111, 113,
116

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.


53


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.


41. Convergence and implementation are basic types of innovation.
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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.


55


Multiple Choice Questions

Preview
1. 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 industry
b. company losses of $30 million
c. two rounds of layoffs
d. 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. motivation
b. information
c. incentives
d. all of the above

ANSWER: B, Knowledge, Difficult, p. 324


Types of Organizational Change
3. All of the following are considered types of organizational change except __________.
a. fast-paced accrual change
b. incremental anticipatory change
c. incremental reactive change
d. radical reactive change

ANSWER: A, Knowledge, Difficult, p. 327

4. __________ change refers to any transformation in the design or functioning of an
organization.
a. Restructuring
b. Redesigning
c. Organizational
d. Incremental

ANSWER: C, Knowledge, Easy, p. 324

5. A(n) _______ change occurs when organizations make major adjustments in the ways
they do business.
a. organizational
b. incremental
c. radical
d. redesigning


56


6. All of the following are true concerning radical change except __________.
a. it occurs relatively infrequently
b. adopting a new organizational structure is an example
c. 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 Lewin
b. the model divides the change process into four stages
c. stage 1 is referred to as “unfreezing”
d. the change is solidified in the “refreezing” stage


8. Monitoring the intended outcomes and providing support for new behaviors are
completed in what stage of radical organizational change?
a. freezing
b. refreezing
c. transitioning
d. none of the above


9. __________ change is an ongoing process of evolution over time, during which small
changes occur routinely.
a. Incremental
b. Radical
c. Transitory
d. Anticipatory

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

10. TQM (total qualify management) relies heavily on what type of organizational change?
a. radical
b. incremental
c. anticipatory

ANSWER: B, Knowledge, Moderate, p. 326

11. The degree and ________ of change combine to form different types of change.
a. severity
b. depth
c. timing
d. consequence


57


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. anticipatory
b. large-scale
c. evolutionary
d. reactive

ANSWER: D, Knowledge, Moderate, p. 326

13. General Electric managers are encouraged to make __________ through Work-Out
sessions.
a. reactive change
b. anticipatory change
c. incremental change
d. 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. Citibank
c. AT&T
d. 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. anticipatory
b. reactive
c. radical
d. 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 ineffective
b. She will have a new job in five years that she can’t even imagine yet
c. She believes she would prefer a job that she can master and become a real expert
at doing
d. 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 change
b. assess the environment
c. diagnose organizational problems
d. identify sources of resistance


19. All of the following are components of organizational change except for __________.
a. assessing the environment
b. reducing the resistance
c. diagnosing organizational problems
d. 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. customers
b. technology
c. unions
d. workforce

ANSWER: C, Knowledge, Difficult, p. 330

21. Of the environmental factors listed, which is the most responsible for stimulating
organizational change?
a. globalization
b. technological advances
c. actions of important stakeholders
d. competitors


59


22. Marriott Hotels and Bank of America use __________ and other forms of market
research to assess customers’ preferences.
a. customer satisfaction surveys
b. “whack-o-meter” sessions
c. performance appraisals
d. diagnostic methods


23. Ed Zander, president of Microsystems, Inc., used __________ to assess the
competitive marketplace.
a. performance appraisals
b. customer satisfaction surveys
c. “whack-o-meter” sessions
d. diagnostic methods


24. The __________ is the difference between what the organization wants to do and what
it actually does.
a. conversion system
b. codifying values
c. performance gap
d. 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 environment
b. determine the difference between what the organization aspires to do to take
advantage of its opportunities and what it actually does
c. determine all new technical breakthroughs

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. assessment
d. organizational diagnosis


60


27. The HR director at Food Ingredient Specialties used __________ to encourage
employees to creatively analyze company problems.
a. motivational speakers
b. videos
c. music
d. 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 change
b. describes the specific measures to be used to monitor progress
c. describes specific measures to be used to evaluate progress toward those goals
d. An action plan provides all of the above.


32. The text mentioned all of the following alternatives to layoffs except __________.
a. reducing hours
b. reducing pay
c. encouraging leaves of absence
d. getting rid of part-time workers


61


33. What is the best way to assure that a plan for organizational change will be
implemented?
a. involve employees early in the process
b. correctly diagnose the problem
c. empower a task force to implement the change
d. 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 Organization
b. European hypermarkets
c. price shocks in the oil markets
d. 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 competitive
b. achieving consistent brand recognition internationally
c. boosting retail outlet sales
d. 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 task
b. a bottom-up task
c. the most essential activity
d. an unending cycle


37. For change to be effective, __________ should be set before the change effort is
started.
a. reasons
b. rewards
c. guarantees
d. goals


62


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 objectives
b. be stated in clear and measurable terms
c. be consistent with the organization’s policies
d. all of the above

ANSWER: D, Application, Difficult, p. 332

39. 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. sabotage
b. silence
c. lawsuit
d. 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. silence
b. sabotage
c. in-your-face defiance
d. 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. education
b. participation
c. fear
d. 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. fear
b. vested interests
c. interactivity
d. misunderstandings


63


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
__________.
a. fear of the unknown
b. vested interests
c. interorganizational agreements
d. 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 __________.
b. cynicism
c. competition
d. vested interests

ANSWER: A, Application, Moderate, p. 333

47. Fear often goes hand in hand with __________.
a. misunderstandings
b. cynicism
c. vested interests
d. 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 _________.
b. vested interests
c. misunderstandings
d. cynicism


64


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. misunderstandings
b. fear
c. vested interests
d. 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?
b. vested interest
c. misunderstanding
d. 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 resistance
b. fear of the unknown
c. cynicism
d. 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. misunderstanding
b. cynicism
c. fear
d. impatience

ANSWER: B, Application, Moderate, p. 334

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


65


54. The final stage of planned organizational change is __________.
a. diagnosis of organizational problems
b. identification of sources of resistance
c. plan the next cycle of change
d. 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 made
b. the skill of the change initiator
c. how well the organization monitors reactions and improvements after the change
effort
d. 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 marketing
b. change its culture
c. change its pricing structure
d. change the top management team


57. Alberto-Culver created growth development leaders to take part in all of the following
except __________.
a. performance reviews
b. one-on-one mentoring
c. communicating the family friendly benefits
d. meeting and communicating with the CEO



Implementing Change
58. 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 goals
b. search for approaches to change
c. implement the change
d. reassess the environment


59. There are four methods of organizational change that include all of the following except
66


__________.
a. job redesign
b. organization redesign
c. environmental change


60. __________ comprises complex networks of computer, telecommunications systems,
and remote-controlled devices.
a. Information technology
b. Inventory management
c. Network design
d. 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 system
b. information technology
c. just-in-time technology
d. 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 change
b. organization Redesign
c. organization development


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 strategy
c. organization development


67


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 efficiency
d. 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 redesign
b. technological change
c. job redesign
d. 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. reengineering
d. reformation

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

68. __________ typically means reconfiguring the distribution of authority, responsibility,
and control in an organization.
a. Streamlining
b. Standardization
c. Restructuring
d. Re-aligning


68


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. restructuring
c. re-shuffling
d. 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. reengineering
b. downsizing
c. job simplification
d. 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. Ingenuity
d. 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 quality
c. increased speed
d. 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 processes
b. focus group results
c. acquisition of resources
d. all of the above

ANSWER: A, Knowledge, Moderate, 337

69


74. By __________ its insurance claims processes, National Grange Mutual was able to
reduce its response time by 55 percent.
a. redesigning
b. restructuring
c. reengineering
d. 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 enrichment
b. Job simplification
c. Job redesign
d. Job empowerment


76. The oldest task approach to change is __________.
a. job enrichment
b. job simplification
c. job empowerment
d. 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 structures
b. tangible outputs
c. situation analysis leadership
d. 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 rotation
c. job enrichment
d. job engineering

ANSWER: C, Application, Easy, p. 338

70


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 development
c. reactive
d. 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 development
c. Team building
d. 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 groups
b. information systems
c. team building
d. survey feedback


71


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 training
c. Team building
d. Reorientation


85. Survey feedback is obtained by means of a __________.
a. questionnaire
b. portfolio
c. PERT chart
d. GANTT chart


86. Intel conducted a survey of its 85,000 employees using a(n) __________ method.
a. Web-based
b. ERP
c. pen and paper
d. 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 environment
b. outdoor adventures
c. competitive games
d. 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-engineering
b. E-commerce
c. E-generation
d. E-digitalizing


72


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 time
b. make the purchase decision appear worthwhile
c. be committed to fully using the new system
d. not request pay raises for the extra work

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


Role of Innovation in Organizational Change
91. __________ is the process of creating and implementing a new idea.
a. Change
b. Strategy
c. Innovation


92. Kodak’s lack of innovation caused all of the following except __________.
a. profits plummeted
b. 34,000 workers were laid off
c. the CEO was fired
d. all of the above


93. Which of the following is not considered a basic type of innovation?
a. technical innovation
b. process innovation
c. behavioral innovation
d. 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. process
b. administrative
c. technical
d. production

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

96. The introduction of do-it-yourself online stock trading represents what type of
innovation?
a. environmental
b. technical
c. production
d. process


97. At Toyota, oobeya was a process innovation that enabled the company to __________.
a. produce more futuristic automobile designs
b. maintain the perfect inventory levels at dealers
c. build cars with almost no workers
d. dramatically lower production costs


98. All of the following are examples of administrative innovation except __________.
a. flexible work schedules
b. telecommuting
c. e-commerce
d. 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 manufacturing
b. chemical
c. food service
d. 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 training
b. in-house manufacturing of its state-of-the-art equipment
c. restructured 10 of its 11 mills
d. 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 environment
b. fostering workforce resilience
c. providing a support system for innovation
d. 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. redesigned
c. innovative
d. learning


103. Which of the following are learning organizations least likely to learn from?
a. past experiences
b. textbooks
c. other companies
d. customers


104. All of the following are considered distinctive features of learning organizations except
__________.
a. shared leadership
b. intensive use of information
c. hierarchical chain of command
d. 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 turnover
b. better quality beverages
c. better financial performance in the long run
d. another product breakthrough


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


107. When people feel they are part of a community, they are more willing to __________.
a. share solutions to problems with their coworkers
b. find problems
c. make extra effort
d. all of the above


108. Learning organizations encourage individual learning in which of the following ways?
a. delegation
b. empowerment
c. “oobeya”
d. all of the above


109. What organizational structure facilitates learning?
a. flat structure
b. team-based structure
c. hierarchical structure
d. 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. teams
b. strategic alliances
c. boundaryless networks
d. 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 alliance
b. team-based
c. measurement-oriented
d. 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 scanning
b. be measurement oriented
c. share problems
d. 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 surveys
b. market share
c. competitors’ strategies
d. 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 market
b. rely on hierarchical structures to maintain control of the drug development process
c. track the expertise of their scientists and engineers
d. 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 information
b. increasing the amount and effectiveness of audit data
c. consolidating the international accounting network with national standards
d. 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

78



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 individuals
b. encourage employees to take temporary leaves of absence
c. not renewing contracts for temporary and part-time workers
d. job sharing
e. reduction of executive salaries and bonuses

Difficult, p. 331

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

a. fear
b. vested interests
c. misunderstandings
d. cynicism

Easy, pp. 333–334

79



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.


80


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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