RSM 260 Practice Final Exam Multiple Choice (30 points, 3 points each) 1. What is the first step in the Rational Decision-Making Model? a. developing alternatives b. identifying the problem c. identifying the decision criteria d. weighing the decision criteria e. collecting relevant data 2. Which of the following is not true of charismatic leaders? a. They have a vision and the ability to articulate the vision. b. They have behavior that is unconventional. c. They are willing to take high personal risk. d. They exhibit behaviors that are consistent with their followers’ behaviors. . all of the above are true 3. What sort of groups are defined by the organization’s structure? a. informal b. task c. friendship d. interest e. formal 4. Most people assume that a police officer should behave in a lawful manner, and not show any favoritism to any particular group, and do their best to uphold the law. What term is used for this kind of belief? a. a norm b. a norm identity c. a role expectation d. a role perception e. a norm violation 5. What term is used for the tendency for individuals to spend less effort when working collectively? a. groupthink . the rule of diminishing returns c. social loafing d. groupshift e. clustering 6. Leaders achieve goals, and power is _____. a. defined by leaders’ hopes and aspirations b. usually used by poor leaders c. a means of achieving goals d. a goal in and of itself e. a strong influence on leaders’ goals 7. One reacts to _____ power out of fear of the negative ramifications that might result if one fails to comply. a. legitimate b. coercive c. punitive d. referent e. abusive 8. Which of the following is not an assumption of the rational decision-making model? . The decision maker is constrained by time and costs. b. The decision criteria are constant and the weights assigned to them are stable over time. c. The decision maker can identify all the relevant criteria and can list all the viable alternatives. d. The decision maker is aware of all the possible consequences of each alternative. e. The decision maker is assumed to have complete information regarding the decision situation. 9. The example of labor-management negotiations over wages exemplifies _____ bargaining. a. integrative . reflective c. distributive d. restrictive e. affective 10. Your _____ determines the lowest value acceptable to you for a negotiated agreement. a. BATNA b. margin of error c. bid price d. asking price e. hidden value 5 POINTS: Describe one concept/theory from your OB course that you find most useful/interesting. How does it apply to your work/life? Be sure to include examples and definitions. CASE-related questions Starbucks and the “Bean Stock” –courtesy of George & Jones, Organizational Behavior, third edition, 2000
Howard Schultz, CEO of Starbucks, bought the company in 1987 and transformed a local Seattle, Washington chain of six coffee stores into a national, publicly owned company with over 25,000 employees and over 1,500 stores. Starbucks’ sales and profit growth have been phenomenal and the company has changed the way that Americans think about coffee. Starbucks’ stores range from coffee carts in crowded city streets to intimate coffee bars to full-sized restaurants that sell espressos and cappuccinos as well as coffee by the pound, coffee-making equipment, and food items.
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Starbucks was recently ranked in the top 75 global brands in a study conducted by the consulting firm, Interbrand. Throughout Starbucks’ rapid growth, Schultz has emphasized the importance of rewarding employees for contributions they make to Starbucks and ensuring that they have the necessary training to be effective. In 1991, when Starbucks was still a privately owned company, Schultz and other top managers came up with an innovative type of reward to encourage employees to behave in ways that would contribute to Starbucks’ growth and profitability.
Starbucks made all employees partners by granting them stock options, which could be turned into stock when the company went public. If the company did well, employees themselves would benefit as their options would be worth more money. Called “Bean Stock,” the options cause employees to behave in ways to increase their profitability. Employees thought of new ways to lower costs and increase sales, ranging from staying overnight on Saturdays when traveling on business to lower the cost of airfares to finding better ways to communicate with customers.
Starbucks went public in 1992 and employees have since been rewarded for their efforts. For example, an employee who earned $20,000 a year in 1991 received options that had a value of $50,000 in 1996. Starbucks continues to give its employees stock options through is Bean Stock plan. Under the plan, employees can cash in their options after keeping them for five years. Starbucks also provides extensive customer service training to employees to ensure that they are knowledgeable and confident on the job and feel capable of making decisions on their own to better serve customers.
Store managers teach classes on topics such as coffee history and coffee brewing at home and employees must take a minimum of 24 hours of training. Employees learn how to take orders and prepare various coffees in a company training room rather than on the job (like in most restaurants) so that they can fully absorb what they are learning, without the stress of waiting on real customers, and receive extensive feedback. Customers then constantly receive the excellent service they have come to expect from Starbucks.
Short-Answer Questions (5-8 sentences answer 15 POINTS EACH) Be sure to state which questions you are answering, and specifically define any theories/ concepts/traits that you use in your answer! 1. What type of leadership has Schultz demonstrated here? 2. What is the role of Schultz in motivating his employees? What motivation theory is he using? ESSAY QUESTIONS (35 POINTS TOTAL): 1. What are two ways to increase group performance that you have learned about in this half of the semester (after the midterm)? Be sure to describe oth the concepts/theories and give a specific example of each. (5 points) 2. Congratulations—you have just gotten a job offer! But, they have offered you less money than you wanted, and more benefits than you need. Describe your negotiation strategy, telling me about two tactics that you will use, and describe your sources of power in this situation. Also, be sure to mention one thing that could influence your ethical/unethical behavior in this situation, and how. (10 points) 3. You have accepted the job and you are now a manager at a product design company.
Your boss just told you that need to develop a new consumer product by the end of the year. You’re unsure if you should assemble a group of people to do this, or assign it to an individual—you’ve heard about biases at the group level, as well as benefits about group level decision making. You also know about decision making biases that can happen in individuals, and the benefits of individuals making decisions. Discuss BOTH sides of the issue, detailing each of these things, so that you can then make an informed, rational decision—finally, which do you recommend to your boss? (20 points)