Question 1

Centralization and decentralization differ because centralization

Accepted Answer

A)   hinders coordination, while decentralization facilitates coordination.
B)   prevents top-level managers from making required organizational changes, while decentralization gives top-level managers greater power to make organizational changes.
C)   ensures that decisions are consistent with organizational objectives, while decentralization can result in decisions at variance with organizational goals.
D)   promotes flexibility, while decentralization reduces flexibility.

Question 2

Global learning based on the multidirectional transfer of skills between subsidiaries and the corporate center is a central feature of a firm pursuing ________ strategy.

Accepted Answer

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

Question 3

In a ________, all roles are viewed as integrating roles.

Accepted Answer

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

Question 4

Firms pursuing a transnational strategy

Accepted Answer

A)   have a low need for coordination.
B)   require very few integrating mechanisms.
C)   cultivate a strong culture.
D)   operate with a worldwide product division structure.

Question 5

What type of control system achieves control through a system of rules and procedures that directs the actions of subunits?

Accepted Answer

A)   personal controls
B)   bureaucratic controls
C)   cultural controls
D)   output controls

Question 6

Discuss the sources of inertia in organizations. Is it easy to make organizational changes?

Accepted Answer

Organizations are difficult to change. W...

Question 7

In a ________, individual managers belong to two hierarchies (a divisional hierarchy and an area hierarchy)  and have two bosses (a divisional boss and an area boss) .

Accepted Answer

A)   worldwide product division structure
B)   classic matrix structure
C)   worldwide area structure
D)   performance structure

Question 8

________ exists when the causes of a subunit's poor performance are not clear.

Accepted Answer

A)   Performance ambiguity
B)   Vertical differentiation
C)   Output controls
D)   Horizontal differentiation

Question 9

To unfreeze the established culture of an organization, the company

Accepted Answer

A)   must take bold steps such as shaking up the management structure in order to implement change.
B)   is best served by taking incremental steps.
C)   should employ the existing structural organization to integrate changes.
D)   implement a rewards or incentive program.

Question 10

By centralizing decision making, a firm

Accepted Answer

A)   allows managers to respond to environmental changes more quickly.
B)   runs the risk of not being able to respond to environmental changes quickly.
C)   can avoid the duplication of activities that occurs when similar activities are carried on by various subunits within the organization.
D)   often has issues with duplication of activities that occurs when similar activities are carried on by various subunits within the organization.

Question 11

Centralization

Accepted Answer

A)   gives top management time to focus on critical issues by delegating more routine issues to lower-level managers.
B)   can give top-level managers the means to bring about needed major organizational changes by concentrating power and authority in one individual or a management team.
C)   permits greater flexibility because decisions do not have to be "referred up the hierarchy" unless they are exceptional in nature.
D)   can be used to establish relatively autonomous, self-contained subunits within an organization.

Question 12

Performance ambiguity lowers the cost of control.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is a disadvantage of a worldwide area structure?

Accepted Answer

A)   Firms that use this structure tend to have a high degree of diversification.
B)   Decision making is centralized and subsidiaries cannot customize to local marketing needs.
C)   The structure encourages fragmentation of the organization into highly autonomous entities.
D)   It does not facilitate local responsiveness.

Question 14

Describe the situation where an international division makes sense. How common is this structure? What are the disadvantages of the structure?

Accepted Answer

When firms initially expand abroad, they...

Question 15

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

Accepted Answer

A)   integrating mechanism
B)   vertical differentiation
C)   knowledge network
D)   horizontal differentiation

Question 16

Which of the following would be a typical responsibility of a product division in a worldwide product divisional structure?

Accepted Answer

A)   operating decisions
B)   overall strategic development of the firm
C)   financial control of the various divisions
D)   decisions regarding legal issues

Question 17

In the ________, the philosophy is that responsibility for operating decisions pertaining to a particular product should be shared by the product division and the various areas of the firm.

Accepted Answer

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

Question 18

Firms pursuing ________ attempt to create value by transferring core competencies from home to foreign subsidiaries.

Accepted Answer

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

Question 19

A ________ encourages fragmentation of the organization into highly autonomous entities.

Accepted Answer

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

Question 20

Which of the following terms refers to the metrics used to measure the performance of subunits and make judgments about how well managers are running those subunits?

Accepted Answer

A)   key processes
B)   control systems
C)   knowledge networks
D)   job evaluations

Exam 14: The Organization of International Business

Discuss the sources of inertia in organizations. Is it easy to make organizational changes?

Correct AnswerverifiedOrganizations are difficult to change. W...View AnswerShow Answer

Describe the situation where an international division makes sense. How common is this structure? What are the disadvantages of the structure?

Correct AnswerverifiedWhen firms initially expand abroad, they...View AnswerShow Answer

Centralization

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Global learning based on the multidirectional transfer of skills between subsidiaries and the corporate center is a central feature of a firm pursuing ________ strategy.

Correct AnswerverifiedShow Answer

What type of control system achieves control through a system of rules and procedures that directs the actions of subunits?

Correct AnswerverifiedShow Answer

Which of the following terms refers to the metrics used to measure the performance of subunits and make judgments about how well managers are running those subunits?

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By centralizing decision making, a firm

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

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Firms pursuing a transnational strategy

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In a ________, all roles are viewed as integrating roles.

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________ exists when the causes of a subunit's poor performance are not clear.

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Centralization and decentralization differ because centralization

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Performance ambiguity lowers the cost of control.

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To unfreeze the established culture of an organization, the company

Correct AnswerverifiedShow Answer

In a ________, individual managers belong to two hierarchies (a divisional hierarchy and an area hierarchy) and have two bosses (a divisional boss and an area boss) .

Correct AnswerverifiedShow Answer

A ________ encourages fragmentation of the organization into highly autonomous entities.

Correct AnswerverifiedShow Answer

Firms pursuing ________ attempt to create value by transferring core competencies from home to foreign subsidiaries.

Correct AnswerverifiedShow Answer

Which of the following is a disadvantage of a worldwide area structure?

Correct AnswerverifiedShow Answer

In the ________, the philosophy is that responsibility for operating decisions pertaining to a particular product should be shared by the product division and the various areas of the firm.

Correct AnswerverifiedShow Answer

Which of the following would be a typical responsibility of a product division in a worldwide product divisional structure?

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Organizations are difficult to change. W...
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When firms initially expand abroad, they...
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