ARE 112- MIDTERM 1 QUESTIONS & ANSWERS
MECE - Answers --Mutually Exclusive (each issue is separate & distinct)
Collectively Exhaustive (every aspect comes under only one issue)
-McKinsey Tool
--know all the facts/details
-guard against making early selection of solutions before all other facts are known
Mother City - Answers --Caral, Peru; "mother city" of Incan civilization
-complexity and scope
-hierarchy of living arrangements
-served as a major trade area --> rise of class divisions
Transaction Costs - Answers --Williamson interview
-cost associated with the time and effort needed to search out, negotiate, and
consummate an exchange (cost of doing business)
--must economize
--have detailed knowledge of attributes of transactions
Cost of Uncertainty - Answers --Williamson interview
-making agreements in the context of uncertainty
--hostage situation
--develop bilateral dependency (mutual advantages)
--introduces a kind of deterrence
-reduce uncertainty --> reduce costs
Bounded Rationality - Answers --Williamson interview
-can't choose the convenient assumption
--adhere closely to reality and behavior that intends to be rational -- not capable of
maximizing in all situations
--limitation on ability to work towards the right answer
Incomplete contracts - Answers --Williamson interview
-transaction costs, cost of uncertainty, and bounded rationality all cause incomplete
contracts
-cannot maximize all benefits of a transaction because they are not aware of all the
factors
--complex contracts
--disallowed by old apparatus
--both parties are not equal
Genghis Khan management style - Answers --keep only the best people -- promote by
ability NOT rank
-looked after their needs
-organized so no one in the dark
, --based on decimal system - easy to train
--commands by hand signals and banners - communication
-train, train, train
-mission driven organization
Dynastic Cycles - Answers --history driven organization
- ruler unites under "mandate from heaven"
-leads to prosperity
-leads to population increases
-leads to corruption
-leads to no ability to respond to disasters
-ruler loses "mandate from heaven"
-leads to warring states emerging
-leads to one victorious state
-"mandate from heaven" comes back
Wild West Management Style - Answers --opportunity driven organization
-access to resources
-aspect of inevitability
-success supplants survival as mission
-like "start ups" today
Ringmaster/ Ringleader - Answers --sets the pace for the organization
-everyone knows what they are supposed to do/ has different tasks
-market driven organization
Classical Management - Answers --careful selection and training of workers
-Frederick Taylor- Taylorism/scientific method
-Max Weber- Bureaucracy
-Henri Fayol- administration of the firm
--> today: Anthony's management Hierarchy
--principle factor= industrial revolution
Scientific Management - Answers --Frederick Taylor
-"Taylorism"
-design jobs with standards leading to efficiency
-select workers to fit the job description
-train workers to follow the design
-support workers by planning their work
Bureaucracy - Answers --Max Weber
-bureaucracy with logic, order,and legitimate authority
-not an organization based on social standing
--division of labor
--hierarchy of authority
--formal rules
MECE - Answers --Mutually Exclusive (each issue is separate & distinct)
Collectively Exhaustive (every aspect comes under only one issue)
-McKinsey Tool
--know all the facts/details
-guard against making early selection of solutions before all other facts are known
Mother City - Answers --Caral, Peru; "mother city" of Incan civilization
-complexity and scope
-hierarchy of living arrangements
-served as a major trade area --> rise of class divisions
Transaction Costs - Answers --Williamson interview
-cost associated with the time and effort needed to search out, negotiate, and
consummate an exchange (cost of doing business)
--must economize
--have detailed knowledge of attributes of transactions
Cost of Uncertainty - Answers --Williamson interview
-making agreements in the context of uncertainty
--hostage situation
--develop bilateral dependency (mutual advantages)
--introduces a kind of deterrence
-reduce uncertainty --> reduce costs
Bounded Rationality - Answers --Williamson interview
-can't choose the convenient assumption
--adhere closely to reality and behavior that intends to be rational -- not capable of
maximizing in all situations
--limitation on ability to work towards the right answer
Incomplete contracts - Answers --Williamson interview
-transaction costs, cost of uncertainty, and bounded rationality all cause incomplete
contracts
-cannot maximize all benefits of a transaction because they are not aware of all the
factors
--complex contracts
--disallowed by old apparatus
--both parties are not equal
Genghis Khan management style - Answers --keep only the best people -- promote by
ability NOT rank
-looked after their needs
-organized so no one in the dark
, --based on decimal system - easy to train
--commands by hand signals and banners - communication
-train, train, train
-mission driven organization
Dynastic Cycles - Answers --history driven organization
- ruler unites under "mandate from heaven"
-leads to prosperity
-leads to population increases
-leads to corruption
-leads to no ability to respond to disasters
-ruler loses "mandate from heaven"
-leads to warring states emerging
-leads to one victorious state
-"mandate from heaven" comes back
Wild West Management Style - Answers --opportunity driven organization
-access to resources
-aspect of inevitability
-success supplants survival as mission
-like "start ups" today
Ringmaster/ Ringleader - Answers --sets the pace for the organization
-everyone knows what they are supposed to do/ has different tasks
-market driven organization
Classical Management - Answers --careful selection and training of workers
-Frederick Taylor- Taylorism/scientific method
-Max Weber- Bureaucracy
-Henri Fayol- administration of the firm
--> today: Anthony's management Hierarchy
--principle factor= industrial revolution
Scientific Management - Answers --Frederick Taylor
-"Taylorism"
-design jobs with standards leading to efficiency
-select workers to fit the job description
-train workers to follow the design
-support workers by planning their work
Bureaucracy - Answers --Max Weber
-bureaucracy with logic, order,and legitimate authority
-not an organization based on social standing
--division of labor
--hierarchy of authority
--formal rules
