Chapter 2 – The Management Environment
Chapter Two: The Management Environment
True/False
1.
Computer systems professionals represent one of the fastest growing worker
populations in the global economy.
(True; Easy; p. 49)
2.
The silicon chip has permanently altered the economics and the ability of computers to
communicate with each other.
(True; Easy; p. 48)
3.
From the late 1800’s until the 1960’s, all economies were agrarian.
(False; Easy; p. 49)
4.
The most powerful technological innovation to influence business in the past decade
has been the rise of the knowledge worker.
(False; Moderate; p. 50)
5.
Globalization has all of the following consequences on management: reduced
constraints of national barriers, increased unemployment and the need to adapt to
different cultures, systems and techniques.
(False; Moderate; pp. 52-53)
6.
By the 1950s, industrial workers had become the largest single group in every
developed country.
(True; Moderate; p. 49)
7.
Today, blue-collar industrial workers account for over 40% of the US workforce.
(False; Easy; p. 49)
8.
Knowledge workers are an important group of technical and professional employees
that currently make up 50% of the US workforce.
(False; Moderate; p. 50)
9.
The national boundaries of world businesses today are becoming increasingly well defined and controlled as global competition increases.
(False; Moderate; p. 50)
10.
A multinational corporation is a company that maintains significant operations in more
than one company simultaneously and decentralizes decision making in each
operation to the local country level.
(False; Moderate; p. 51)
11.
In order to be effective in a boundaryless world, managers need to focus on their own
cultures, systems, and techniques.
(False; Moderate; p. 52)
12.
Transnational corporations maintain significant operations in two or more countries
simultaneously, but are based in one home country.
(False; Challenging; p. 52)
37
Part 1 - Introduction
13.
Strategic alliances provide domestic companies with faster and less expensive ways to
compete globally than if they did it on their own.
(True; Easy; p. 53)
14.
Collectivism is the degree to which people in a country act as individuals rather than
members of a group.
(False; Moderate; p. 54)
Hofstede’s research demonstrated that there are relatively few major differences in
values between employees from different national cultures.
(False; Moderate; p. 54)
15.
16.
Assertiveness is the extent to which a society encourages people to be tough,
confrontational and competitive versus modest and tender.
(True; Easy; p. 56)
17.
The emphasis in the United States is on ascribed status, in which status is often the
result of factors such as seniority and education.
(False; Moderate; p. 54)
18.
According to the Globe Ratings of Leadership, the United States has high ratings on
assertiveness.
(True; Easy; p. 55 Ex. 2-4)
19.
E-commerce is the full breath of activities included in a successful Internet-based
business.
(False; Easy; pp. 57-58)
“Quality of life" refers to cultures that value things such as assertiveness and the
acquisition of money and material goods.
(False; Moderate; p. 54)
20.
21.
Type A organizations are contemporary organizations with heavy reliance on intranets
and extranets.
(False; Easy; p. 58)
22.
As manager of Xithropy, Inc. you may become regularly confronted with decisions that
have a dimension of social responsibility. Examples of major factors would be
decisions about distribution, advertising, employee insurance, or length of workweek.
(False; Challenging; pp. 60-62)
23.
Moral responsibility refers to a business firm's obligation to pursue long-term goals that
are good for society.
(False; Moderate; p. 62)
24.
Brown Company plans to layoff five employees to meet organizational goals. Whittier,
Inc. is attempting to create a more efficient operation through extreme layoffs of 27
employees. Whittier, Inc. is practicing rightsizing.
(False; Challenging; p. 69)
38
Chapter 2 – The Management Environment
25.
The empowerment movement is being driven by two forces. The first is the need for
quick decisions by those people who are most knowledgeable about the issues. The
second is the reality that the large layoffs in the upper-management ranks have left
many managers with considerably more people to supervise than they had in the past.
(False; Challenging; p. 78)
26.
Cyclical labor trends are difficult to predict.
(True; Moderate; p. 71)
27.
Many organizations today are increasing the decision-making discretion of workers by
redesigning their jobs. Management calls this practice empowerment.
(True; Easy; p. 74)
28.
Because customers demand higher quality, more organizations are making
commitments to constantly improving the quality of their products and services through
a practice called total quality management.
(False; Easy; p. 75)
29.
The Theory of Justice view of ethics refers to a situation in which an individual imposes
and enforces rules fairly and impartially.
(True; Moderate; p. 63; Ex.27)
30.
Only 67% of Fortune 1000 companies have a stated code of ethics.
(False; Easy; p. 63)
31.
The work of Hofstede on national culture indicated that national culture does not have
a major impact on employees' work-related values and attitudes.
(False; Easy; p. 54)
32.
Hofstede's cultural dimension term "individualism" refers to a loosely knit social
framework in which people are supposed to look after their own interests and those of
their immediate family.
(True; Challenging; p. 54)
33.
In essence, parochialism is an ethnocentric view.
(True; Easy; p. 53)
34.
Traditional approaches to studying international business have sought to advance
specific principles for each culture.
(False; Moderate; p. 53)
Multiple Choice Questions
35.
Which of the following is the fastest growing worker population in the global economy?
a. Blue collar workers
b. Technical professionals
c. Computer systems analysts
d. Managers
(c; Moderate; p. 49)
39
Part 1 - Introduction
36.
From the following choice of answers, choose the one that is not currently changing
the way information is created, stored, used, or shared.
a. digital electronics
b. optical data transmissions
c. computer networking
d. optical data storage
(b; Moderate; p. 48)
37.
According to Toffler, which wave of modern civilization focused on the individual who
was his/her own boss performing a variety of tasks?
a. agriculture
b. industrialization
c. manufacturing
d. information
(a; Moderate; p. 48)
38.
According to Toffler all of the following were characteristic of Wave 2-Industrialization
except
a. mass production.
b. specialized jobs.
c. rise of skilled craftsmen.
d. rise of blue-collar workers.
(c; Moderate; p. 48)
39.
Which wave of modern civilization transformed society from a manufacturing focus to a
focus on service?
a. agriculture
b. industrialization
c. manufacturing
d. information
(d; Moderate; p. 49)
40.
The most powerful technological innovation to influence business in the past ten years
has been
a. knowledge workers.
b. globalization.
c. industrialization.
d. dot-com businesses.
(d; Moderate; p. 50)
41.
Computer programmers, software designers, and systems analysts are commonly
referred to as
a. service workers.
b. the first wave.
c. industrial workers.
d. information technologists.
(d; Moderate; p. 50)
40
Chapter 2 – The Management Environment
42.
The concept of a boundaryless world where goods and services are produced and
marketed worldwide is known as
a. the global village.
b. the global community.
c. MNCs.
d. international businesses.
(a; Moderate; p. 50)
43.
Hofstede identified all of the following fundamental differences in values that can be
used to characterize people in different national cultures except
a. power orientation.
b. social orientation.
c. economic orientation.
d. time orientation.
(c; Moderate; p. 54)
44.
Which of the following is a characteristic of the new economy?
a. Population is relatively homogeneous.
b. National borders are nearly meaningless in defining an organization's operating
boundaries.
c. Business is estranged from its environment.
d. Customers get what business chooses to give them.
(b; Moderate; p. 50; Ex. 21)
45.
_________ is the cultural belief that the group is more important and takes priority over
the interests of the individual.
a. Individualism
b. Assertiveness
c. Collectivism
d. Humane Orientation
(b; Moderate; p. 56)
46.
Which of the following type of corporation initiated the rapid growth in international
trade?
a. transnational corporations
b. uninational corporations
c. multinational corporations
d. blue-chip corporations
(a; Moderate; p. 52)
47.
Multinational corporations maintain significant operations in _____ or more countries,
but are based in _____ home country/countries.
a. four; one
b. two; one
c. one; two
d. one; four
(b; Challenging; p. 51)
41
Part 1 - Introduction
48.
Decision making in transnational corporations occurs at the _____ level.
a. local
b. home office
c. continental
d. regional
(a; Moderate; p. 52)
49.
Who runs operations in each country for a transnational corporation?
a. management teams sent from the Home Office
b. management teams sent from the Regional Office
c. nationals
d. management teams sent from the United States
(c; Moderate; p. 52)
50.
According to the GLOBE leadership study which country had among the highest
ratings of assertiveness?
a. Switzerland
b. Germany
c. Spain
d. Sweden
(c; Moderate; p. 55; Ex. 2-4)
51
According to the GLOBE leadership study which counties were rated the most
collective, or least individualistic?
a. Singapore and Japan
b. Hong Kong and U.S.
c. Japan and Israel
d. Greece and Germany
(a; Challenging; p. 55; Ex. 2-4)
52.
In terms of the use of information technology, Type C organizations are _____.
a. small traditional retail and service firms
b. contemporary organizations that rely on intranets and extranets
c. fully functioning e-organizations
d. small e-commerce firms
(c; Moderate; p. 58)
53.
The use of intranets and extranets is lowest in which type of organization?
a. Type B
b. Type A
c. Type C
d. Type E
(b; Easy; p. 58)
54.
Which of the following is NOT an argument that supports Corporate Social
Responsibility?
a. Public expectations
b. Cost
c. Stockholder Interest
d. Better Environment
(b; Moderate; p. 61; Ex. 2-6)
42
Chapter 2 – The Management Environment
55.
The utilitarian view of ethical behavior is that which provides_______.
a. the greatest good for the greatest number of people
b. respect and protects the individual’s fundamental rights
c. fair and impartial enforcement of rules
d. protection of individual rights to free speech, privacy, religion and due process
interests
(a; Moderate; p. 63; Ex. 2-7)
56.
The main focus of the Theory of Justice view of ethical behavior is _______.
a. the greatest good for the greatest number of people
b. that it respects and protects the individual’s fundamental rights
c. that it enforces rules fairly and impartially
d. that it protects individual rights to free speech, privacy, religion and due process
interests
(c; Moderate; p. 63; Ex. 2-7)
57.
Many U.S. Corporations were forced to downsize in 2003 due to the economic
recession. What impact did this have on the workforce?
a. More blue-collar worker were employed.
b. Workers found it easier to find jobs.
c. More than 2.5 million jobs were eliminated.
d. More minority workers found jobs.
(c; Easy; p. 69)
58.
Which of the following are not part of the contingent workforce?
a. employees who work more than 40 hours per week
b. part-time consultants
c. contractors
d. outsourced employees
(a; Moderate; p. 69; Ex. 2-9)
59.
Which of the following is a characteristic of the old economy?
a. The economy was driven by large corporations.
b. Job opportunities were for knowledge workers.
c. Business accepted its social responsibilities.
d. Customer needs drove business.
(a; Easy; p. 50; Ex. 21)
60.
Which of the following is not a component of the Continuous Improvement Process?
a. intense customer focus
b. concern for continuous improvement
c. accurate measurement process
d. reward for performance
(d; Moderate; p. 76)
43
Part 1 - Introduction
61.
A(n) _____ business transcends national boundaries and decentralizes decision
making in each operation to the local level.
a. international
b. domestic
c. multinational
d. transnational
(d; Moderate; p. 52)
62.
Which of the following international business strategies has the lowest amount of risk?
a. Importing/exporting strategy
b. Joint venture
c. Licensing strategy
d. Direct investment
(a; Moderate; p. 52)
63.
All but which of the following are options if a business decides to go global?
a. exporting its product
b. contracting with foreign manufacturers
c. franchising
d. importing its product
(d; Moderate; pp. 52-53)
64.
An organization going global typically proceeds through three stages. In Stage I,
a. the organization hires host country nationals.
b. managers export products to foreign countries.
c. the organization sells products in foreign countries or makes them in foreign
factories.
d. the organization signs a licensing or franchise agreement.
(b; Challenging; p. 52)
65.
In Stage II of going global, an organization might
a. build production facilities in a foreign country.
b. export products to foreign countries.
c. hire foreign agents or brokers to represent the organization's product lines.
d. license or franchise to another firm the right to use the organization's brand name.
(c; Challenging; pp. 52-53)
66.
A narrow focus where managers see things solely through their own eyes and within
their own perspective is known as
a. an ethnocentric view.
b. a world view.
c. parochialism.
d. a global view.
(c; Moderate; p. 53)
44
Chapter 2 – The Management Environment
67.
The United States does not produce rubber, so when a U.S. Tire Manufacturer wants
to purchase rubber to manufacture its tires locally in the U.S., it must engage in which
kind of strategy?
a. Importing
b. Direct investment
c. Global sourcing
d. Exporting
(a; Moderate; p. 52)
68.
In France, status is often the result of all the following factors except
a. seniority.
b. education.
c. personal accomplishment.
d. organizational factors.
(c; Moderate; pp. 53-54)
69.
_____ is the first type of international business (Stage I) in which firms usually become
involved.
a. Joint venture
b. Licensing
c. Importing/exporting
d. Direct investment
(c; Easy; p. 52)
70.
An international business advances to stage III. Which of the following new strategies
are used (Stage I) usually become involved?
a. Joint ventures and licensing
b. Agents and importing
c. Importing and exporting
d. Direct investment and exporting
(a; Easy; p. 53)
71.
What strategy did HP use when it agreed to let some Japanese firms manufacture
computers and printers and use the HP name and logo?
a. Importing/exporting
b. Direct investment
c. Joint venture
d. Licensing
(a; Easy; p. 53)
72.
If a U.S. company that furnishes the facilities and equipment and a Chinese firm that
furnishes the operating capital join together to build ships for international commerce,
they are involved in
a. importing and exporting.
b. licensing.
c. outsourcing.
d. a strategic alliance.
(d; Moderate; p. 53)
45
Part 1 - Introduction
73.
_____ is the form of international business involvement in which a domestic and a
foreign firm share the costs of developing new products or building production
facilities in a foreign country.
a. Direct investment
b. An Importing agreement
c. A Joint venture
d. International brokering
(c; Moderate; p. 53)
74.
Taco-Bell operates restaurants around the world on U.S. military bases. The
agreement between Taco-Bell and the Department of Defense is a(n)
a.
global sourcing agreement.
b.
strategic alliance.
c.
exporting agreement.
d.
direct investment.
(b; Moderate; p. 53)
75.
According to Hofstede, which of the following has a major impact on employees' workrelated values and attitudes?
a. national culture
b. company culture
c. international culture
d. regional culture
(a; Moderate; p. 54)
76.
Which of the following is not one of the four specific dimensions of national culture
according to Hofstede?
a. power distance
b. uncertainty avoidance
c. space acceptance
d. individualism versus collectivism
(c; Moderate; p. 54)
77.
Which of the following statements most accurately describes the average age of the
American workforce?
a.
It is much younger than it was 20 years ago.
b.
It is much younger than Japan’s workforce.
c.
There are an equal number of workers in each age category.
d.
It is increasing.
(d; Easy; p. 71)
78.
Part-time, temporary, and contract workers who are available for hire on an as-needed
basis are known as
a. consultants.
b. core employees.
c. surplus workforce.
d. contingent workforce.
(d; Easy; p. 71)
46
Chapter 2 – The Management Environment
79.
The US labor shortage is a function of two factors: birth rates and _____.
a. lack of knowledge workers
b. workforce downsizing
c. outsourcing
d. labor participation
(d; Challenging; p. 71)
80.
The fact that in the United States employees are generally not in fear or awe of their
managers is an example of which of the following dimensions of national culture?
a. power distance
b. uncertainty avoidance
c. space acceptance
d. individualism versus collectivism
(a; Moderate; p. 54)
81.
A society where there is relatively little job mobility and widely practiced lifetime
employment would be an example of which of the following dimensions of national
culture?
a. power distance
b. quality of life
c. uncertainty avoidance
d. individualism versus collectivism
(c; Moderate; p. 54)
82.
Technology has made it possible to enhance production processes by replacing
a. human labor with electronic/computer equipment.
b. electronic/computer equipment with human labor.
c. human labor with assembly lines/manufacturing firms.
d. assembly lines/manufacturing firms with electronic/computer equipment.
(a; Challenging; p. 57)
83.
One of the greatest effects of e-commerce is that
a. costs will be reduced.
b. customers will be empowered.
c. employees become more powerful.
d. computers will be less important.
(b; Moderate; p. 57)
84.
Which of the following is not an argument for the assumption of social responsibility by
business?
a. long-run profits
b. stockholder interests
c. ethical obligations
d. costs
(d; Moderate; p. 61; Ex. 26)
47
Part 1 - Introduction
85.
Which of the following is not an argument against the assumption of social
responsibility by business?
a. lack of skills
b. lack of accountability
c. lack of broad public support
d. possession of resources
(d; Moderate; p. 61; Ex. 26)
86.
Telecommuting will change the relationship between managers and employees.
Managers can expect
a. that employees need greater managerial time.
b. that tighter controls are needed.
c. greater employee involvement in decision making.
d. employees will be less productive.
(c; Challenging; p. 59)
87.
The belief that a firm's obligation goes beyond that required by law and economics,
and includes a pursuit of long-term goals that are good for society is known as
a. social responsiveness.
b. ethical responsibility.
c. social responsibility.
d. social obligation.
(c; Moderate; p. 62)
88.
Which of the following deals with the need of a business to meet only basic economic
and legal standards?
a. social responsibility
b. social obligation
c. moral obligation
d. social responsiveness
(b; Moderate; p. 62)
89.
A large chemical company not only disposes of all toxic waste properly as outlined by
law, but it also spends $1 million dollars each year on research to determine better
processes for all businesses to use in disposing of toxic wastes. This company is
exhibiting which of the following?
a. social responsibility
b. social obligation
c. moral obligation
d. social responsiveness
(a; Moderate; p. 62)
48
Chapter 2 – The Management Environment
90.
A large pulp and paper company meets all federal guidelines and obeys all laws
rigorously as it cuts down timber. The primary concern of this company is compliance
and profit maximization for its stockholders. This company is exhibiting which of the
following?
a. social responsibility
b. social obligation
c. moral obligation
d. social responsiveness
(b; Moderate; p. 62)
91.
Focusing on the greatest good for the greatest number of people is an example of
which of the following views of ethics?
a. utilitarian view
b. theory of justice view
c. rights view
d. ethical view
(a; Moderate; p. 63; Ex. 27)
92.
The _____ view of ethics refers to a situation in which the individual is concerned with
respecting and protecting individual liberties and privileges.
a. theory of freedom
b. utilitarian
c. rights
d. theory of justice
(c; Moderate; p. 63; Ex. 27)
93.
Choose the activity that is not one that entrepreneurs engage in.
a. Assess the potential for the new venture.
b. Deal with start-up issues.
c. Plan the venture.
d. Choose the right insurance agency.
(d; Moderate; p. 65)
94.
In general, entrepreneurs are better able than managers in a traditional hierarchical
organization to
a. lead.
b. organize.
c. respond to a changing environment.
d. respond to a static environment.
(c; Moderate; p. 65)
95.
Acme Plastics is an organization that is becoming more diverse. As a result,
management has been adapting its human resource practices to reflect this change in
all of the following ways but which one?
a. provide diversity training
b. promote and retain more white males
c. encourage vendor diversity
d. hire and promote more minorities
(b; Challenging; p. 66)
49
Part 1 - Introduction
96.
Kay's company is using more and more outside firms to provide necessary products
and services. This is known as
a. outsourcing.
b. downsizing.
c. reengineering.
d. rightsizing.
(a; Moderate; p. 69)
97.
Linking staffing levels to organizational goals is known as
a. outsourcing.
b. downsizing.
c. work process engineering.
d. rightsizing.
(d; Moderate; p. 69)
98.
Managers today realize that long-term success can be achieved primarily by satisfying
the customer. Customers are demanding quicker service, higher quality, and more
_____.
a. value for their money
b. personal attention
c. variety in services
d. online choices
(a; Challenging; p. 72)
99.
There is a clear chain of cause-and-effect running from employee _____ and behavior
to customer attitudes and _____ to an organization's revenues and _____.
a. perceptions; behavior; successes
b. attitudes; behavior; profits
c. needs; wants; profits
d. dissatisfaction; needs; image
(b; Challenging; p. 73)
100.
Which of the following is not a component of total quality management?
a. concern for continuous improvement
b. accurate measurement
c. employee empowerment
d. focus on the stockholders of the company
(d; Moderate; p. 76; Ex. 211)
Scenario-Based Questions
Application of Hofstede's Cultural Dimensions
Kevin knew that it was likely his corporation was going to ask him to go abroad and
manage the new chemical factory they were building. He was excited about the
prospects but also apprehensive. He had never traveled before and, as far as he was
concerned, there was only one way to do anything—the "American way." He decided
some research was in order to at least get an idea about other countries. In his
reading, he learned that some cultures place a high priority on a loose social
framework, where they feel primarily responsible for themselves and their immediate
50
Chapter 2 – The Management Environment
family. He also learned that in some societies, employees show a great deal of respect
for those in authority, and titles and rank carry much weight. Some countries have little
job mobility and practice lifetime employment. He also learned that some countries are
characterized by assertiveness and materialism. Now he wondered if there was any
framework to help organize his thoughts.
101.
Kevin noticed that in China, workers were more likely to hold the cultural belief that the
group comes first. This is what Hofstede referred to as _________________.
a. individualism
b. aggressive goal behavior
c. power tolerant
d. collectivism
(d; Moderate; p. 54)
102.
According to the Globe Research Study, people who exhibit _____ tend to be
concerned about reliance on social norms and procedures to alleviate the
unpredictability of future events.
a. aggressive goal behavior
b. uncertainty avoidance
c. collectivism
d. passive goal behavior
(b; Moderate; p. 55)
103.
In the Philippines, cock-fighting, bull fights, and other aggressive games are a national
pastime; based on this observation, this culture would appear to be rated high on the
________ orientation.
a. collectivism
b. assertiveness
c. uncertainty avoidance
d. quantity versus quality of life
(b; Challenging; p. 56)
104.
What orientation describes a culture that is characterized by planning, investing in the
future and delaying gratification?
a. Individual orientation
b. Time orientation
c. Future orientation
d. Assertiveness orientation
(c; Moderate; p. 56)
105.
Based on his research, Kevin discovered that which of the following Globe cultural
dimensions was not contained in Hofstede’s original of national culture?
a. Individualism versus collectivism orientation
b. Time orientation
c. Assertiveness orientation
d. Humane orientation
(d; Challenging; p. 56)
51
Part 1 - Introduction
106.
Kevin could be said to have which of the following points of view?
a. ethnocentric view
b. world view
c. parochialism
d. focused view
(a; Moderate; p. 53)
107.
Who developed a framework describing specific dimensions of national culture that
Kevin could use in order to organize his information?
a. Maslow
b. Herzberg
c. Hofstede
d. Zane
(c; Moderate; p. 54)
108.
A culture where employees show a great deal of respect for authority and where titles
and rank are important would be an example of which dimension of national culture?
a. individualism versus collectivism
b. power distance
c. uncertainty avoidance
d. quantity versus quality of life
(b; Challenging; p. 54)
109.
A culture that is characterized by assertiveness and materialism would be
demonstrating which dimension of national culture?
a. individualism versus collectivism
b. power distance
c. uncertainty avoidance
d. quantity versus quality of life
(d; Challenging; p. 54)
110.
A culture that practices lifetime employment would be demonstrating which dimension
of national culture?
a. individualism versus collectivism
b. power distance
c. uncertainty avoidance
d. quantity versus quality of life
(c; Challenging; p. 54)
111.
The value dimension that Kevin did not consider is _____.
a. individualism versus collectivism
b. long-term versus short-term orientation
c. the role of women and the elderly
d. separation of business and government
(b; Moderate; p. 54)
Application of Corporate Social Responsibility
Kerri was confused. Her management class was focusing on social responsibility, and
her assignment was to find business cases demonstrating social responsibility. She
had several examples, but now she was not sure which case was an example of which
52
Chapter 2 – The Management Environment
concept. Her first business dealt with the tuna industry, which in response to pressure
from environmentalists, had stated dolphins would no longer be caught with the tuna.
Her second business dealt with a company whose primary focus was on profit
maximization for its stockholders. The primary focus of this company was legal
compliance and profit maximization. Her third business was in the tobacco industry
that each year gives thousands of dollars to the arts. Her fourth business also dealt
with the tobacco companies and the fact they were no longer advertising near local
schools. Legislation had been enacted in order to prevent cigarettes from being
promoted in locations where children under the age of 18 would be likely to see the
advertisements.
112.
A firm's obligation to pursue long-term goals that are good for society is known as
a. social responsibility.
b. social obligation.
c. social responsiveness.
d. moral obligation.
(a; Moderate; p. 62)
113.
The first business is an example of a business that has
a. social responsibility.
b. social obligation.
c. social responsiveness.
d. moral obligation.
(c; Moderate; p. 62)
114.
The second business is an example of a business that has
a. social responsibility.
b. social obligation.
c. social responsiveness.
d. moral obligation.
(b; Moderate; p. 62)
115.
The third business believes it has
a. social responsibility.
b. social obligation.
c. social responsiveness.
d. moral obligation.
(a; Moderate; p. 62)
116.
The fourth business is an example of a business that has
a. social responsibility.
b. social obligation.
c. social responsiveness.
d. moral obligation.
(c; Moderate; p. 62)
53
Part 1 - Introduction
Which of the following actions were not represented in Kerri’s assignment?
a. social responsibility
b. social obligation
c. social responsiveness
d. ethical obligation
(b; Challenging; p. 62)
117.
Application of Contemporary Management Practices
Jenny had been reading several management periodicals for her class assignment.
She was confused by all the terms she had come across in her search for changes
that were reshaping contemporary organizations. The first article had described a new
business owner who had taken a large calculated risk to initiate his new business
venture where he had become quite successful at the age of 26. The next article dealt
with a process that managers were using for quality control at a local cheese
producing plant. The company was constantly monitoring the cheese-making process
and little by little improving the quality of its cheese. The next article was in direct
contrast. This roller blade manufacturer had decided that its product needed to be
completely remade in order to keep up with the competition. So it had basically started
from scratch and developed a new revised product. Several of the articles Jenny had
read talked about companies laying off numerous employees, and the practice was not
limited to the United States. It was occurring worldwide. Finally, several articles had
also mentioned that businesses were hiring fewer core employees and using more
contingent workers. Many larger businesses were hiring people to fill in for those
employees off for an extended time period, such as for a new dad off for 12 weeks
after the birth of a child.
118.
The new business owner could best be described by which of the following?
a. reengineer
b. downsizer
c. entrepreneur
d. intrapreneur
(c; Moderate; p. 64)
119.
The roller blade company was using which of the following techniques?
a. intrapreneurship
b. entrepreneurship
c. total quality management
d. rightsizing
(a; Moderate; p. 65)
120.
The practice of laying off employees is known as
a. reengineering.
b. downsizing.
c. total quality management.
d. rightsizing.
(b; Moderate; p. 69)
54
Chapter 2 – The Management Environment
121.
Which type of worker is replacing the new father who is staying home with his baby?
a. part-time employee
b. temporary employee
c. contract employee
d. project employee
(b; Easy; p. 69; Ex. 2-9)
122.
Chose the type of worker that is not considered a contingent worker.
a. part-time employee
b. temporary employee
c. contract worker
d. overtime employee
(d; Challenging; p. 69; Ex. 29)
Short Discussion Questions
123.
Briefly describe Hofstede’s five fundamental differences that can be used to
characterize people in different cultures. He found that managers and employees vary
on five value dimensions of national culture.
Hofstede’s five fundamental cultural dimensions are:
1) Power distance
2) Individualism versus collectivism
3) Quantity of life versus quality of life
4) Uncertainty avoidance
5) Long-term versus short-term orientation
(Easy; p. 54)
124.
What are two major opposing views of corporate social responsibility?
The classical—or purely economic—view that management’s only social responsibility is to
maximize profits. The socioeconomic position, which holds that management’s responsibility
goes well beyond making profits, to include protecting and improving society’s welfare.
(Moderate; pp. 60-62)
125.
Compare and contrast the international strategies used at Stage I versus those used at
Stage III do they differ?
(Easy; p. 51-53)
In Stage I, managers make the first push toward going international merely by exporting the
organization’s products to foreign countries. This is a passive step toward international
involvement that requires minimal risk because managers make no serious effort to tap
foreign markets. Rather, the organization fills foreign orders only when it gets them.
55
Part 1 - Introduction
Stage III represents a strong commitment by managers to pursue international markets
aggressively. Managers can license or franchise to another firm the right to use the
organization’s brand name, technology, or product specifications. Joint ventures involve larger
commitments; a domestic and a foreign firm can form a strategic alliance.
126.
Compare and contrast the following: global village, multinational corporations, and
transnational corporations.
Global village—a boundaryless world where the production and marketing of goods and
services are worldwide.
Multinational corporations—companies that maintain significant operations in two or more
countries simultaneously, but are based in one home country.
Transnational corporations—companies that maintain significant operations in more than one
country simultaneously and decentralize to the local country decision making in each
operation. (Moderate; pp. 50-52)
127.
What is a parochialism view?
Parochialism is a narrow focus—these managers see things solely through their own eyes
and within their own perspectives.
(Easy; p. 53)
128.
What is the difference between an entrepreneur and an intrapreneur?
Entrepreneur is initiating a business venture and assuming risks and rewards. Intrapreneur is
a person within an organization who demonstrates entrepreneurial characteristics.
(Easy; pp. 64-65)
129.
How can organizations make the customer king?
To make this theory a reality, organizations and their managers can embark on several critical
activities—creating a customer-responsive culture, continuous improvements in quality, and
work process engineering.
(Moderate; p. 72)
130.
Describe three types of contingent workers.
Part-time employees—work fewer than 40 hours a week; few benefits.
Temporary employees—generally employed full time during peak production periods and then
leave.
Contract workers—hired to work on specific projects; typically very skilled.
(Easy; p. 69; Ex. 29)
Medium Length Discussion Questions
131. What effect does globalization have on managers? How can one respond to these
challenges?
A) A boundaryless world introduces new challenges for managers.
1. One specific challenge, one of the first issues to deal with, is the perception of
“foreigners.” U.S. managers in the past held a rather parochial view of the world of
56
Chapter 2 – The Management Environment
business. Parochialism is a narrow focus held by many managers. This involves
seeing things solely from ones own perspective and is an ethnocentric view. They
believed that their business practices were the best in the world.
2. Manager often fail to appreciate that countries have different values, morals,
customs, political and economic systems, and laws. Traditional approaches to
international business sought to advance general principles. It is also important to
realize that organizational success can come from a variety of managerial
practices.
3. Other countries also have differences in their laws, values and legal systems.
B) Responding to the global challenges--suggestions—
1. Viewing the global environment from any single perspective may be potentially
problematic.
2. An appropriate approach is recognizing the cultural dimensions of a country’s
environment
(Challenging; p. 53)
132.
Identify the arguments for and against social responsibility in the light of social versus
economic consequences for the community and businesses. Are there major
differences between the way interest groups and executives view social responsibility
–Why? How does a social responsibility differ from a social obligation?
Exhibit 2-6 provides a good summary of the arguments.
Social responsibility is a business firm’s obligation, beyond that required by the law
and economics, to pursue long-term goals that are good for society. Note that this
definition assumes that business obeys the law and pursues economic interests. We
take as a given that all business firms—those that are socially responsible and those
that are not—will obey all laws that society imposes. Also note that this definition views
business as a moral agent. Social obligation is the foundation of a business’s social
involvement. A business has fulfilled its social obligation when it meets its economic
and legal responsibilities and no more.
(Challenging; pp. 61-62)
133.
Compare and contrast what managers a generation ago valued compared to today’s
managers.
A generation ago successful managers valued stability, predictability, and efficiency achieved
through economies of large size. Many of these managers and their companies have faded
because they did not adapt to what was happening around them. Today’s companies are
leaner, faster, and more flexible. Their managers are dedicated to quality, organizing work
around teams, creating ethical work environments, minimizing hierarchical overhead, and
exhibiting entrepreneurial skills when facing change.
(Challenging; pp. 4849)
134.
Briefly describe each of Toffler's three waves.
Agrarian—until late 19th century; people employed in agriculture-related jobs; people were
their own bosses; and their success or failure was contingent on their production.
Industrialization—from the late 1800s until the 1960s; work moved into formal organizations;
workers no longer produced an entire product; and workers performed routine work.
Information—from the start of the 1970s; technological advancements eliminated many low-
57
Part 1 - Introduction
skilled, blue-collar jobs; move to technical and professional jobs; and includes technologists
and knowledge workers.
(Moderate; pp. 4849)
135.
Compare and contrast social responsibility, social obligation, and social
responsiveness.
Social responsibility—a firm's obligation to pursue long-term goals that are good for society.
Social obligation—the obligation to meet economic and legal responsibilities.
Social responsiveness—the ability of a firm to adapt to changing societal conditions.
(Easy; p. 62)
136.
Describe the three dominant views of ethics.
Utilitarian view—decisions are made solely on the basis of their outcomes or consequences.
Rights view—individual is concerned with respecting and protecting individual liberties and
privileges.
Theory of justice view—individual imposes and enforces rules fairly and impartially.
(Challenging; p. 63; Ex. 27)
Comprehensive Essays
137.
How the stages of globalization impact organizations?
An organization going global typically proceeds through three stages as shown in Exhibit 2-2.
Stage I, the first step toward going international, exporting the organization’s products.
There is a passive step involving minimal risk. The organization fills foreign orders only
when it gets them.
Stage II, managers make an overt commitment to sell products or make products
abroad. There is still no physical presence of company employees outside the
company’s home country. Sales are conducted by sending domestic employees on
regular business trips to meet foreign customers or by hiring foreign agents or brokers.
Managers sign contracts with a foreign firm to produce their products.
Stage III, a strong commitment to pursue international markets aggressively.
As shown in Exhibit 2-2, managers can do this in different ways.
License or franchise agreements are used to obtain the right to use the brand name,
technology, or product specifications. Joint ventures involve larger commitments; a
domestic and a foreign firm share the cost of developing new products or building
production facilities in a foreign country.
These are called strategic alliances. These partnerships provide a fast and lessexpensive way for companies to compete globally than if they would do themselves.
Stage IV: The greatest commitment and risk, occurs when the organization sets up a
foreign subsidiary. Such subsidiaries can be managed as an MNC (with domestic
control), a TNC (with foreign control), or a borderless organization (with global control).
(Challenging; pp. 52-53)
58
Chapter 2 – The Management Environment
138.
Discuss Hofstede's cultural dimensions.
Individualism versus collectivism—a loosely knit social framework as opposed to a more
tightly knit social framework; the individual versus the group.
Power distance—the amount of acceptance for the unequal distribution of power in institutions
and organizations.
Uncertainty avoidance—a culture with high uncertainty avoidance has a high level of anxiety
among its people, so formal rules are developed with strict compliance expected.
Quantity versus quality of life—quantity of life refers to values that are characterized by
assertiveness and materialism, where as quality of life focuses on relationships and concern
for others.
(Challenging; p. 54)
139.
Discuss two arguments for social responsibility and two arguments against social
responsibility.
Arguments for:
Public expectations
Long-run profits
Ethical obligations
Public image
Possession of resources
Arguments against:
Violation of profit maximization
Dilution of purpose
Costs
Too much power
Lack of skills
(Moderate; p. 61; Ex. 26)
140.
Distinguish between e-commerce and e-business.
The term e-commerce is becoming the standard label to describe the sales side of electronic
business. It is more than supplying product information or providing entertainment. It
encompasses presenting products on Web sites and filling orders. Today, 90% of ecommerce sales are business-to-business.
In contrast e-business refers to the full breadth of activities included in a successful Internetbased enterprise. It includes developing strategies for running Internet-based companies;
improving communication between employees, customers, and suppliers; and collaborating
with partners to electronically coordinate design and production. Note that the term eorganization (e-org) merely refers to applications of e-business concepts to all organizations.
(Challenging; p. 58)
141.
Discuss the similarities and differences between Hofstede's cultural dimensions and
the Globe Research Study Findings.
Although Hofstede’s work provides the basic framework for differentiating among national
cultures, these data are nearly 30 years old. Undoubtedly, a lot has happened over the past
several decades. For example, the Soviet Union has fallen, East and West Germany have
59
Part 1 - Introduction
merged, and apartheid has ended in South Africa. As such, there is a need to update these
classic cultural dimensions. The GLOBE study provides such an update. Begun in 1993, the
Global Leadership and Organizational Behavior Effectiveness (GLOBE) research
program is an ongoing cross-cultural investigation of leadership and national culture. Using
data from 825 organizations in 62 countries, the GLOBE
team identified the following nine dimensions on which national cultures differ (see Exhibit 2–4
for country ratings).
A comparison of the GLOBE dimensions against those of the landmark research suggests
that the former has extended the earlier research’s work rather than replace it. The GLOBE
study confirms that the original dimensions are still valid. However, it has added some
dimensions and provides us with an updated measure of how countries rate on each
dimension. For instance, although the United States led the world in individualism in the
1970s, today its score is in the midrange of countries. We can expect future cross-cultural
studies of human behavior and organizational practices to increasingly use the GLOBE
dimensions to assess differences between countries.
(Challenging; pp. 54-55)
60