Free IIA-CIA-PART4 Exam Braindumps (page: 49)

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A new manager of a production department has been asked to assess the effectiveness of that department. The organization needs to satisfy both internal and external constituents and takes a broad approach to effectiveness. To complete the assignment successfully, the manager should:

  1. Measure the daily productivity of the department.
  2. Do a survey of employee morale, as it is often a major underlying factor in productivity.
  3. Compare the past year's production against annual goals.
  4. Consider short-, medium-, and long-term effectiveness.

Answer(s): D

Explanation:

Kreitner Management, 9th ed., page 298) states, "Organizational effectiveness can be defined as meeting organizational objectives and prevailing societal expectations in the near future, adapting and developing in the intermediate future, and surviving in the distant future." In the near term about one year), it should be effective in achieving its goals, efficient in its use of resources, and a source of satisfaction to its constituencies owners, employees, customers, and society). In the intermediate term 2 to 4 years), it should adapt to new possibilities and obstacles and develop its abilities and those of its members. In the long term 5+ years), the organization should be able to survive in an uncertain world.



Which of the following is the best measure of productivity to use to evaluate several departments in a large retail store?

  1. Number of customers served per employee per day.
  2. Revenue per square foot.
  3. Number of units sold per department per day.
  4. Average number of units stocked per month per department.

Answer(s): B

Explanation:

Productivity is the ratio of real output to a unit of input. Increased productivity is the goal of every organization because its effect is to improve the ultimate measures of performance, such as the profits of a business. For a retail store, a critical output of interest is revenue per square foot. The floor space in the store is a limited resource whose productivity should be analyzed.



After three years of steadily decreasing profits despite of increased sales and a growing economy, which of the following is the preferred course of action for a chief executive officer to take?

  1. Set a turnaround goal of significantly increasing profits within two months.
  2. Reduce staff by 10 percent in every unit.
  3. Reduce staff in the nonvalue-adding functions by 20 percent.
  4. Encourage innovation at all levels and use an early retirement program to reduce staff size.

Answer(s): D

Explanation:

(Organizational decline loss of effectiveness and efficiency coupled with inflexibility) may lead to downsizing, merger, reorganization, or liquidation. It results from decreased demand, resource limitations, or mismanagement. One characteristic of a declining organization is lack of innovation. Moreover, the most important cause of organizational decline is management complacency. In turn, a characteristic of management complacency is lack of innovation. Consequently, the CEO should encourage innovation at all levels. Also, downsizing has many negative effects. The enlightened view is that employees are not readily disposable commodities, but rather valuable resources who should be terminated only as a last resort. This view seeks alternatives to involuntary termination. One such alternative is a voluntary retirement program that offers accelerated retirement benefits, severance allowances, or other compensation.



The alignment of managerial goals with organizational goals usually requires:

I). Assigning responsibility for activities.
II). Delegating the authority to perform necessary tasks.
III). Establishing accountability.
IV). Measuring and evaluating performance.

  1. I and IV only.
  2. I, II, and III only.
  3. II, Ill, and IV only.
  4. I, II, Ill, and IV).

Answer(s): D

Explanation:

Authority is the right to direct and exact performance from others, including the right to prescribe the means and methods by which the work will be done. The right to direct should be distinguished from the ability the power) to accomplish tasks. Responsibility is the obligation to perform. In the classical view, this obligation is formally imposed by a superior and is inherent in any job. In the behavioral view, responsibility must and should be delegated; there is a successive dividing and passing down of obligation. The appropriate amount of authority or power must be delegated with the responsibility. However, a higher position cannot escape ultimate responsibility. Accountability is the duty to account for the fulfillment of the responsibility. In practice, accountability is the duty to report performance to one's superior and the physical means for reporting or being able to substantiate performance, i.e., record keeping. Thus, measuring and evaluating performance is related to accountability. Consequently, an organizational structure is effective if it facilitates the contribution of individuals toward the attainment of enterprise objectives.






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