Chapter 8

1.      What is organizational structure? How does it develop? 

 An organizational structure is a firm's shared values, beliefs, traditions, philosophies, rules, and role models for behavior.  It develops when a managers assigns work tasks and activities to specific individuals or work groups and coordinate the diverse activities required to reach the firm's objectives.

2.      What are some of the advantages of specialization? 

Advantages of specialization are people can perform more efficiently if they master just one task rather than all tasks.  Specialization also occurs when activities that must be performed within an organization are too numerous for one person to handle.

 

3.      Define delegation of authority and show its relationship to responsibility. 

Delegation of authority is giving employees not only tasks, but also the power to make commitments, use resources, and take whatever actions are necessary to carry out those tasks.  Delegation gives a responsibility to employees to carry out assigned tasks satisfactorily and holds them accountable for the roper execution of their assigned work.

 

4.      What is the difference between line structure and line-and-staff structure? 

Line structure has direct lines of authority that extend from the top manager to employees at the lowest level of the organization.  Line-and-staff structure has traditional line relationship between superior and subordinates, and specialized managers are available to assist line managers.

 

5.      What is a self-directed work team? 

A self-directed work team is a group of employees responsible for an entire work process or segment that delivers a product to an internal or external customer.

 

6.      How can managers use the "grapevine" to their advantage? 

Managers use the grapevine to their advantage by using it as a "sounding device" for possible new policies or to obtain valuable information that could improve decision making.  Some also use the grapevine by floating ideas, soliciting feedback, and reacting accordingly.

Chapter 7

1.      What is management? 

Management is a process designed to achieve an organization’s objectives by using its resources effectively and efficiently in a changing environment.

2.      Describe the major functions of management. 

The major functions of management are planning (activities to achieve the organization’s objectives), organizing (resources and activities to achieve the organization’s objectives), staffing (the organization with qualified people), directing (employees’ activities toward achievement of objectives) and controlling (the organization’s activities to keep it on course).

3.      How do top managers differ from first-line managers?

Top line managers include the president and other top executives, such as the CEO, CFO or COO who have overall responsibility for the organization.  First-line managers are those who supervise workers and the daily operations of the organization; responsible for implementing the plans established by middle management and directing workers’ daily performance on the job. 

4.      What are some of the skills needed by managers? 

Skills needed by managers are leadership, technical expertise, conceptual skills, analytical skills and human relation skills.

5.      What is the systematic six step approach that leads to more effective decision making? 

The systematic six step approach is recognizing and defining the decision situation, developing options, analyzing options, selecting the best option, implementing the decision and monitoring the consequences.

Chapter 6

1.      What is a small business? 

A small business is any independently owned and operated business that is not dominant in its competitive area and does not employ more than 500 people.

2.      How important is small business to the U.S. economy? 

A small business is vital to the U.S. economy.  More than 99% of all U.S. firms are classified as small businesses and they employ 50% of private workers.

3.      What are some of the advantages of small-business ownership? 

Advantages of small-business ownership are independence, costs are low, flexibility is easy, focus is also flexible and also they can develop a good reputation for quality and service.

4.      Why do small businesses have a high failure rate? 

Small businesses have a high failure rate because of choosing the wrong business to start, burdens put on by the government, insufficient funds and competition with larger companies are just a few reasons.

5.      What is a business plan and why is it important? 

A business plan is a precise statement of the rationale for the business and a step-by-step explanation of how it will achieve its goals.  It is important because it is a guide of how to conduct your business and make sure it goes smoothly.

6.      What demographic trends will have the most impact on small business in the future? 

The demographic trends that will have the most impact on small business in the future will be the boomer demographic, the echo boomers and the immigrants.

7.      Why would a big business "act small?" 

A big business would act small because they are trying to capitalize on small-business success in introducing innovative new products and to improve their bottom line.

Chapter 5

1.      What are sole proprietorships? Provide an example. 

Sole proprietorships are businesses owned by an individual. EX would be a cleaning service owned by one individual.

2.      Define the partnership form of business organization. What are its advantages? 

The partnership forms of business organization are two or more people who carry on as co-owners of a business for a profit.  They are the least used form of business.  Advantages are starting a partnership requires no more than drawing up articles of partnership, partnerships grow to be larger than sole proprietorships which earn more power and better credit ratings also for tax purposes the tax is lower.

3.      How do preferred stockholders differ from the common stockholders of a corporation? 

Preferred stockholders are a special class of owners because although they generally do not have any say in running the company, they have a claim to any profits before any other stockholders do.  Common stockholders do not get such treatment with regard to dividends, they do get some say in the operation of the corporation; vote for members of the board.

4.      What is a leveraged buyout? What are some of the advantages of mergers and acquisitions? 

A leveraged buyout is when a group of investors borrows money from banks and other institutions to acquire a company, using the assets of the purchased company to guarantee repayment of the loan.  Advantages of mergers and acquisitions are acquisitions sometimes involve the purchase of a division or some other part of a company rather than the entire company.

Chapter 4

1.      What is information technology and in what areas has it especially affected the economy? 

Information includes meaningful and useful interpretation of data and knowledge that can be used in making decisions.  Information is necessary for good decision making.  When information is properly understood, guidelines can be developed that help simplify and improve decisions in future similar circumstances.

2.      What is the purpose of an MIS? 

An MIS is used for organizing and transmitting data onto information that can be used for decision making.  The purpose is to obtain data from both internal and external sources to create information that is easily accessible and structured for user friendly communication to managers.

3.      What is the Internet? The World Wide Web? 

The Internet is the global information system that links many computer networks together.  The World Wide Web is a collection of interconnected Web sites or pages of text, graphics, audio, and video.

4.      Why did many early dot-coms fail? 

Because they thought the only thing that mattered was the brand awareness they created through advertising.

5.      What is the purpose of U.S. copyright laws? 

The purpose of U.S. copyright laws are there to protect original works in text form, pictures, movies, computer software, musical multimedia, and audio visual work.

Chapter 3

1.      In international trade, what is the difference between an absolute advantage and a comparative advantage? 

An absolute advantage exists when a country is the only source of an item, the only producer of an item, or the most efficient producer of an item.  A comparative advantage occurs when a country specializes in products that it can supply more efficiently or at a lower cost than it can produce other items.

2.      What cultural issues should a manager consider before doing business in a foreign country? 

Body language, personal space and family roles.  Different countries have different cultural backgrounds so it varies from country to country.  Depending on the country you are dealing with depends on what you should or should not do.

3.      What is the International Monetary Fund (IMF)? 

The International Monetary Fund was established to promote trade among member nations by eliminating trade barriers and fostering financial cooperation.  It also makes short-term loan to member countries that have balance-of-payment deficits and provides foreign currencies to member nations.

4.      Explain the different levels of organizational involvement in international trade. 

Exporting and importing, trading companies, licensing and franchising, contract manufacturing, joint ventures, direct investment, and multinational corporations.

5.      Explain the phrase "Think globally, act locally." 

While being aware of the total picture, they adjust their firms’ strategies to conform to local needs and tastes.

Chapter 2

1.      What is business ethics? 

Business ethics are the principles and standards that determine acceptable conduct in business organizations.

2.      What are some of the general ethical issues in business? 

Some general ethical issues in business are abusive and intimidating behavior, fairness and honesty, conflict of interest, false and misleading communication, or business relationships.

3.      How can an organization improve ethical behavior? 

Ethical decisions in an organization are influenced by three key factors; individual moral standards, the influence of managers and co-workers, and the opportunity to engage in misconduct.  Professional codes of ethics or whistleblowing are two ways to improve ethical behavior.

4.      What are the four dimensions of social responsibility? 

Voluntary responsibilities, ethical responsibilities, legal responsibilities, and economic responsibilities.

5.      Discuss the environmental issues managers must confront in dealing with social responsibility issues. 

Animal rights which is basically people that say doing research on animals is morally wrong because it harms living creatures.  Pollution (air, water or land) putting toxic chemicals into our land, air or water is wrong.  Community relations is the concerns their responsibilities to the general welfare of the communities and societies in which they operate.