Exam 2 Flashcards
(21 cards)
- Discuss the reasons for success and for failure of an entrepreneurial venture.
Success
- effective planning team that make goals, develop a plan of action, and monitor progress
Failure
- Small businesses have high failure rate
- Bad efficiency in management, usually by ther team as a whole
Identify types of departmental organization along with strengths and weaknesses. (functional)
Functional
- Adv. = Each department can be staffed by functional-area experts.
Supervision is facilitated in that managers only need be familiar with a narrow set of skills.
Coordination inside each department is easier.
- Dis. = Decision making becomes slow and bureaucratic.
Employees narrow their focus to the department and lose sight of organizational goals/ issues.
Accountability and performance are difficult to monitor.
Identify types of departmental organization along with strengths and weaknesses. (Customer)
Customer
- Adv. = Skilled specialists can deal with unique customers’ needs or customer groups.
- Dis. = A large administrative staff is needed to integrate activities of various departments – redundant functional staff
Identify types of departmental organization along with strengths and weaknesses. (Product)
Product
- Adv. = All activities associated with one product can be integrated and coordinated.
Speed and effectiveness of decision making are enhanced.
Performance of individual products or product groups can be assessed.
- Dis. = Managers may focus on their product to the exclusion of the rest of the organization.
Redundancy: Administrative costs may increase due to each department having its own functional-area experts.
Identify types of departmental organization along with strengths and weaknesses. (Location)
Location
- Adv. = Enables the organization to respond easily to unique customer and environmental characteristics.
- Dis. = Large administrative staff may be needed to keep track of units in scattered locations.
Identify the 4 types of departmental organization
Functional, Customer, Product, Location
Discuss the primary sources of funding normally used to finance new businesses.
- Personal resources
- Relatives
- Strategic alliances
- Lenders (bank, credit)
- SBICs
- Venture Capital Companies
- Grants - SBA
- Franchise
Explain the five basic elements of organizing
Job Specialization
- The degree to which the overall task of the organization is broken down and divided into smaller component parts.
Departmentalization
- The process of grouping jobs according to some logical arrangement
Reporting Relationships
- determining who reports to whom
Distributing Authority
- Power that has been legitimized by the organization
Coordinating Activities
- The process of linking the activities of the various departments of the organization
Explain the five basic forms of organization design.
Functional (U-Form)
- Organizational members and units are grouped into functional departments
Conglomerate (H-Form)
- Organization consists of a set of unrelated businesses with a general manager for each business
Divisional (M-Form)
- based on multiple businesses in related areas operating within a larger organizational framework; following a strategy of related diversification.
Activities are decentralized down to the divisional level; others are centralized at the corporate level.
Matrix
- An organizational arrangement based on two overlapping bases of departmentalization.
Hybrid
- A blend of two or more
Identify the key reasons for resistance to change and techniques managers can use to overcome resistance.
Reasons for resistance
- Fear of the unkown
- disruption of familairity/comfortability
Overcoming Resistance to Change
- Encourage active participation in the change process
- Provide education and communication about the change process
- Make only necessary changes, announcing changes in advance, and allowing time to adapt to change
- Conduct a force field analysis
Explain and apply Force Field Analysis
A decision-making tool used to analyze the factors that drive or hinder a change process. It helps organizations assess whether a proposed change is feasible.
Steps to Apply Force Field Analysis
Define the Change
Identify the change you want to implement (e.g., adopting a new accounting software).
Identify Driving Forces
List the factors that support the change.
Example:
Increases efficiency
Reduces errors
List factors that resist the change.
Example:
Employees fear learning new software
Explain the behavioral aspects of decision making including some of the key influences
- Bounded Rationality
The concept that decision makers are limited by their values and unconscious reflexes, skills, and habits. - Satisficing
The tendency to search for alternatives only until one is found that meets some minimum standard of sufficiency to resolve the problem. - Intuition
An innate belief about something
without conscious consideration. - Escalation of Commitment
A decision maker’s staying with
a decision even when it appears
to be wrong. - Risk Propensity
The extent to which a decision maker is willing to gamble when making a decision. - Coalition
A positive or negative political force in decision making which consists of an informal alliance of individuals or groups formed to achieve a goal.
Discuss group and team decision making to include its advantages and disadvantages.
advantages are easy
dis. - groupthink
Interacting group or team
Consists of an existing group or newly formed team interacting and then making a decision or producing a product.
Delphi groups
Developing a consensus of expert opinion from a panel of experts who individually contribute through a moderator.
Nominal groups
Generating ideas through the individual contributions of alternatives that are winnowed down to reach a decision.
Discuss types of decisions and decision-making conditions.
- Programmed Decisions
A decision that is relatively structured or recurs with some frequency (or both) - Nonprogrammed Decisions
A decision that is relatively unstructured and occurs much less often than a programmed decision.
Example: Strategy, mergers, purchases, buildings. - Decision Making Under Certainty
The decision maker knows with reasonable certainty what the alternatives are and what conditions are associated with each alternative. - Decision Making Under Risk
The availability of each alternative and its potential payoffs and costs are all associated with risks.
Autonomy
degree of control one has
Skill Variety
Number of things a person does
Task Identity
extent to which one does a complete or identifiable portion of a job
Tall vs. Flat organization
Tall Organizations
Are more expensive because of the number of managers involved.
Foster more communication problems because of the number of people through whom information must pass.
Flat Organizations
Lead to higher levels of employee morale and productivity.
Create more administrative responsibility for the relatively few managers.
Create more supervisory responsibility for managers due to wider spans of control
