Answer the following statement(s) true (T) or false (F)

Question

1) The mechanistic organization emphasizes flexibility and is less rigid than the organic structure.
2) Strategies and structures are based on the firm's core capabilities, its strategic alliances, its ability to learn, and its ability to engage all the people in the organization in achieving its objectives.
3) A strategic alliance can be made with just about any other organization except one's competitors.
4) An organization's size has a large impact on its ability to respond effectively to its environment.
5) The difficulty of controlling a large company with many product lines and divisions is an example of a diseconomy of scale.

Answer 1

1. FALSE
Explanation: The organic structure stands in stark contrast to the mechanistic organization. It is much less rigid and, in fact, emphasizes flexibility.

2. TRUE
Explanation: Strategies and structures are based on the firm's core capabilities, its strategic alliances, its ability to learn, and its ability to engage all the people in the organization in achieving its objectives.

3. FALSE
Explanation: A strategic alliance is a formal relationship created with the purpose of joint pursuit of mutual goals. They occur between companies and their competitors, governments, and universities.

4. TRUE
Explanation: One of the most important characteristics of an organization, and one of the most important factors influencing its ability to respond effectively to its environment, is its size.

5. TRUE
Explanation: Larger companies are more difficult to coordinate and control. Although size may enhance efficiency by spreading fixed costs over more units, it also may create bureaucratic hassles that constrain performance. Diseconomies of scale are the costs of being too big.