Question 1

Beyond the initial functional division of the organization, further horizontal differentiation may be required if the firm significantly diversifies its product offering, which takes the firm into different business areas.

Accepted Answer

A) True 
 B)False

Question 2

In firms pursuing ________, some operating decisions are relatively centralized, while others are relatively decentralized.

Accepted Answer

A)   a global standardization strategy
B)   a transnational strategy
C)   a localization strategy
D)   an international strategy

Question 3

A firm's ________ determines where in its hierarchy the decision-making power is concentrated.

Accepted Answer

A)   organizational architecture
B)   vertical differentiation
C)   organizational structure
D)   horizontal differentiation

Question 4

Which of the following is a potential drawback of the worldwide area structure?

Accepted Answer

A)   This structure discourages division of the organization into autonomous entities.
B)   This structure makes it difficult to decentralize decisions regarding operations authority.
C)   This structure makes it difficult to realize location and experience curve economies.
D)   This structure reduces local responsiveness.

Question 5

Why should a firm centralize its decision making?

Accepted Answer

Firms should centralize their decision m...

Question 6

Firms pursuing ________ strategy are more centralized than enterprises pursuing a localization or international strategy.

Accepted Answer

A)   a localization
B)   an international
C)   a global standardization
D)   a transnational

Question 7

What is horizontal differentiation?

Accepted Answer

A)   the mechanisms that enable each subunit to operate independently
B)   the formal division of the organization into subunits
C)   the location of decision-making responsibilities within a structure
D)   the mechanisms for coordinating subunits

Question 8

Firms pursuing a global standardization strategy must cope with a higher level of ________, and this raises their costs of control.

Accepted Answer

A)   vertical differentiation
B)   cultural division
C)   horizontal differentiation
D)   performance ambiguity

Question 9

Direct contact between subunit managers is the simplest integrating mechanism.

Accepted Answer

A) True 
 B)False

Question 10

Firms pursuing a localization strategy tend to operate with an array of formal and informal integrating mechanisms.

Accepted Answer

A) True 
 B)False

Question 11

The need for coordination between subunits is lowest in firms pursuing

Accepted Answer

A)   a localization strategy.
B)   an international strategy.
C)   a global strategy.
D)   a transnational strategy.

Question 12

Which of the following is one of the four main arguments favoring centralization?

Accepted Answer

A)   It permits greater flexibility.
B)   Motivational research favors it.
C)   It can avoid the duplication of activities.
D)   It gives top management time to focus on critical issues by delegating routine issues to lower-level managers.

Question 13

________ control is a type of control that tends to be most widely used in small firms.

Accepted Answer

A)   Personal
B)   Output
C)   Bureaucratic
D)   Cultural

Question 14

In Firm A, each division is a self-contained, largely autonomous entity with full responsibility for its own value creation activities. What type of structure does Firm A employ?

Accepted Answer

A)   worldwide product division structure
B)   global matrix structure
C)   worldwide area structure
D)   knowledge network structure

Question 15

The need for coordination between subunits is greatest in firms pursuing

Accepted Answer

A)   a localization strategy.
B)   an international strategy.
C)   a global strategy.
D)   a transnational strategy.

Question 16

Which of the following is true of a strong corporate culture?

Accepted Answer

A)   Almost all managers share a relatively consistent set of values and norms that have a clear impact on the way work is performed.
B)   A strong culture leads to high performance.
C)   Outsiders see firms with a strong culture as being autocratic and inflexible.
D)   A strong culture is always a good culture.

Question 17

Because of inertia forces, ________ is often no change.

Accepted Answer

A)   big bang change
B)   cultural change
C)   shock therapy change
D)   incremental change

Question 18

Which of the following is an effective strategy for implementing organizational change?

Accepted Answer

A)   Physically move the organization to a new state.
B)   Keep the organizational structure.
C)   Refreeze the organizational structure.
D)   Slowly, through incremental changes, rearrange the organizational structure.

Question 19

The need for coordination between units is greatest in firms pursuing a localization strategy.

Accepted Answer

A) True 
 B)False

Question 20

A firm that needs greater flexibility should choose ________ for its decision making.

Accepted Answer

A)   horizontal differentiation
B)   decentralization
C)   localization strategy
D)   control systems

Exam 14: The Organization of International Business

Which of the following is a potential drawback of the worldwide area structure?

Correct AnswerverifiedShow Answer

What is horizontal differentiation?

Correct AnswerverifiedShow Answer

Which of the following is an effective strategy for implementing organizational change?

Correct AnswerverifiedShow Answer

Direct contact between subunit managers is the simplest integrating mechanism.

Correct AnswerverifiedShow Answer

In Firm A, each division is a self-contained, largely autonomous entity with full responsibility for its own value creation activities. What type of structure does Firm A employ?

Correct AnswerverifiedShow Answer

Which of the following is true of a strong corporate culture?

Correct AnswerverifiedShow Answer

Beyond the initial functional division of the organization, further horizontal differentiation may be required if the firm significantly diversifies its product offering, which takes the firm into different business areas.

Correct AnswerverifiedShow Answer

A firm that needs greater flexibility should choose ________ for its decision making.

Correct AnswerverifiedShow Answer

The need for coordination between units is greatest in firms pursuing a localization strategy.

Correct AnswerverifiedShow Answer

A firm's ________ determines where in its hierarchy the decision-making power is concentrated.

Correct AnswerverifiedShow Answer

Firms pursuing a localization strategy tend to operate with an array of formal and informal integrating mechanisms.

Correct AnswerverifiedShow Answer

The need for coordination between subunits is greatest in firms pursuing

Correct AnswerverifiedShow Answer

Which of the following is one of the four main arguments favoring centralization?

Correct AnswerverifiedShow Answer

The need for coordination between subunits is lowest in firms pursuing

Correct AnswerverifiedShow Answer

________ control is a type of control that tends to be most widely used in small firms.

Correct AnswerverifiedShow Answer

Firms pursuing a global standardization strategy must cope with a higher level of ________, and this raises their costs of control.

Correct AnswerverifiedShow Answer

In firms pursuing ________, some operating decisions are relatively centralized, while others are relatively decentralized.

Correct AnswerverifiedShow Answer

Firms pursuing ________ strategy are more centralized than enterprises pursuing a localization or international strategy.

Correct AnswerverifiedShow Answer

Why should a firm centralize its decision making?

Correct AnswerverifiedFirms should centralize their decision m...View AnswerShow Answer

Because of inertia forces, ________ is often no change.

Correct AnswerverifiedShow Answer

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Firms should centralize their decision m...
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