Designing Coordinating Elements The more complex the structure a company uses to
ID: 359675 • Letter: D
Question
Designing Coordinating Elements
The more complex the structure a company uses to group its activities, the greater are the problems of linking and coordinating its different functions and divisions. Coordination becomes a problem because each function or division develops a different orientation toward the other groups, and this orientation affects how it interacts with those groups. CEOs must decide on the appropriate number of managerial layers, how decentralized authority should be, and how to link the different functions and divisions to increase performance.
You are about to read a case facing the new CEO at a large organization. The material will deal with the coordination of the organization’s functions and divisions and the decisions the CEO will need to take in order to improve the performance of the firm.
Read the case below and answer the questions that follow.
Lorena is the new CEO of Rocke Inc. Over the last two decades, Rocke Inc. has grown substantially and has developed multiple divisions in many different industries. Recently, Rocke Inc. has been losing money, stock value, and contracts due to its poor coordination and integration.
Lorena has been reviewing the performance and condition of the company in order decide if a change in the organization’s structure is needed. Lorena has noticed that, compared to other organizations of this size she has worked with, Rocke seems to have a high number of managerial levels. Each manager supervises only a very few subordinates rather than the number they could be managing using current information technology. Reports show that decision making is extremely slow in the organization. Each manager seems to feel the need to double and triple check that decisions are being passed down the chain of command and then implemented. Each decision appears to require a great deal of paperwork as each subordinate manager signs off on the decision as it is transmitted. Frequent mistakes and distortions in communication contribute additional problems.
Lorena has spent the last several weeks refereeing disputes among the various division managers and even among their subordinates, the functional managers. No one seems to know anymore what the main goals of the organization are or how what they do contributes to the organization’s success. The battles between the managers are contributing to the slowdown of manufacturing, the slower than normal development of new products, and the inability of the company to respond to changes in customer needs.
Lorena thinks she knows enough now to decide on some major changes. Without these changes, she feels Rocke Inc. risks continued losses and possible failure.
1. Lorena's observation that Rocke Inc. has more managerial levels than other companies in the industry indicates that Rocke Inc. is a _____ organization.
flat
tall
bureaucratic
modern
post-modern
2. It is obvious from the high number of managerial layers in the organization that previous CEOs have not practiced the principle of
the minimum chain of command.
centralization of command.
parsimony of command.
unity of command.
command and control.
3. Lorena's observation about how many subordinates respond directly to each manager reflects concern with
too wide of a span of control.
too narrow of a span of control.
too much centralization.
too little centralization.
too much bureaucracy.
4. The slowness of decision making at Rocke Inc. appears to be a result of
too much centralization.
insufficient use of modern information technology.
poorly trained managers.
insufficient use of modern information technology and too much centralization.
insufficient use of modern information technology and too little centralization.
5. The lack of agreement among managers as to even the goals of the organization indicates a lack of _______ in the organization.
new product development and sales forecasts
information technology, outside suppliers, and export capabilities
marketing tactics
a strong culture, integrating mechanisms, and a well-spelled-out strategy
new-hire orientation programs
6. Coordination between functional departments at Rocke Inc. could be improved by
creating liaison roles.
adding more functional managers.
adopting a matrix structure.
turning the production line into a team-based process.
installing a knowledge management system and adopting a matrix structure.
Explanation / Answer
1.Rocke Inc is a tall organization in which there are many managers and they control a small span of people.
2. It is obvious from the high number of managerial layers in the organization that previous CEOs have not practiced the principle of command and control.
3.Lorena's observation about how many subordinates respond directly to each manager reflects concern with too narrow a span of control is.
4.. The slowness of decision making at Rocke Inc. appears to be a result of insufficient use of modern informational technology and too much centralisation.
5. The lack of agreement among managers as to even the goals of the organization indicates a lack of _____a strong culture,integrating mechanisms and a well spelled oit strategy__ in the organization.
6. Coordination between functional departments at Rocke Inc. could be improved by installing a knowledge management system and adopting a matrix structure.
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