Organisations and Organisational Effectiveness

Question 1

Organization

Answer 1

A tool people use to coordinate their actions to obtain something they desire or value.

Question 2

Entrepreneurship

Answer 2

The process by which people recognise opportunities to satisfy needs and then gather and use resources to meet those needs.

Question 3

Organisational environment

Answer 3

The set of forces and conditions that operate beyond an organisation’s boundaries but affect its ability to acquire and use resources to create value.

Question 4

Inputs

Answer 4

Resources such as raw materials, machinery, information and knowledge, human resources, and money and capital

Question 5

Organization obtains inputs from its environment:

Answer 5

Raw materials

Money and capital

Human resources

Information and knowledge

Customers of service organisations

Question 6

Organization transforms inputs and adds value to them:

Answer 6

Machinery
Computers
Human skills and abilities

Question 7

Organisation releases outputs to its environment:

Answer 7

Finished goods
Services
Dividends
Salaries
Value for stakeholders

Question 8

Sales of outputs allow organisation to obtain new supplies of inputs:

Answer 8

Customers
Shareholders
Suppliers
Distributors
Government
Competitors

Question 9

Why do organisations exist?

Answer 9

Organisations exist as they can create more value together

To increase specialisation and the division of labour

To use large scale technology

To manage the organisational environment

To economise on transaction costs

To exert power and control

Question 10

Economies of scale

Answer 10

Cost savings that result when goods and services are
produced in large volume on automated production lines.

Question 11

Economies of scope

Answer 11

Cost savings that result when an organisation is able to use underutilised resources more effectively because they can be shared across different products or tasks.

Question 12

Transaction costs

Answer 12

The costs associated with negotiating, monitoring, and governing exchanges between people.

Question 13

Organisational theory:

Answer 13

The study of how organisations function and how they affect and are affected by the environment in which they operate

Question 14

Organisational structure:

Answer 14

The formal system of task and authority relationships that control how people coordinate their actions and use resources to achieve organisational goals.

Question 15

Organisational Design and Change

Answer 15

The process by which managers select and manage various dimensions and components of organisational structure and culture so that an organisation can control the activities necessary to achieve its goals

Question 16

Organizational Culture

Answer 16

The set of shared values and norms that controls organisational members’ interactions with each other and with people outside the organisation.

Controls coordination and motivation; shapes behaviour of people and the organisation.

Is shaped by people, ethics, and organisational structure.

Evolves as organisation grows and differentiates.

Can be managed and changed through the process of organisational design.

Question 17

Organisational design

Answer 17

The process by which managers select and manage aspects of structure and culture so that an organization can control the activities necessary to achieve its goals.

Question 18

Organisational change

Answer 18

The process by which organisations redesign their structures and cultures to move from their present state to some desired future state to increase their effectiveness.

Question 19

Contingency

Answer 19

An event that might occur and must be planned for.

Question 20

Competitive advantage

Answer 20

The ability of one company to outperform another because its managers are able to create more value from the resources at their disposal.

Question 21

Core competences

Answer 21

Managers’ skills and abilities in value-creating activities

Question 22

Strategy

Answer 22

The specific pattern of decisions and actions that managers take to use core competences to achieve a competitive advantage and outperform competitors.

Question 23

Chief operating officers (COOs)

Answer 23

Made responsible for overseeing organisational structure and culture.

COOs create and oversee teams of experienced senior managers who are responsible for organisational design and for orchestrating not only small and incremental but also organisation-wide changes in strategy, structure, and culture.

Question 24

The three most important processes managers use to assess and measure how effective they, and their organisations, are at creating value:

Answer 24

Control, innovation, and efficiency

Question 25

External resource approach

Answer 25

A method managers use to evaluate how effectively an
organisation manages and controls its external environment

Question 26

Internal systems approach:

Answer 26

A method that allows managers to evaluate how effectively an organisation functions and resources
operate

Question 27

Official goals:

Answer 27

Guiding principles that the organisation formally states in its annual report and in other public documents.

Question 28

Mission

Answer 28

Goals that explain why the organisation exists and what it should be doing.

Question 29

Example of official goals:

Answer 29

being a leading producer of a product, demonstrating an overriding concern for public safety, and so forth

Question 30

Operative goals:

Answer 30

Specific long-term and shortterm goals that guide
managers and employees as they perform the work of the organisation

Question 31

Technical approach

Answer 31

A method managers use to evaluate how efficiently an
organisation can convert some fixed amount of organisational resources into finished goods and services.