Exam 6: Designing Organizations for the International Environment

Which of the following kinds of formal positions do organizations create to coordinate information and activities related to key customer accounts?

What does building a global presence enable an organization's operations to achieve?

Discuss the three primary approaches to coordination and control as represented by Japanese, North American, and European companies.

The global geographical structure divides the world into geographical regions, with each geographical division reporting to the CEO.

Compare and contrast the globalization strategy and the multidomestic strategy. Give an example of effective use of each strategy.

CHART 6.1 -Refer to Chart 6.1. Which of the following best describes the organization depicted in Chart 6.1?

Case 6.0 It was reported in the Wall Street Journal that Ford Motor Co. was reorganizing to place its functions such as product development, sales, and engine/transmissions under their own executives with global authority. Alexander Trotman, chairman and CEO, wanted to create a structure that would avoid costly duplication in different parts of the world and that would foster Ford's development of models such as its Mondeo (Europe) and Contour (U.S.), which could sell worldwide with few modifications. Trotman wanted a company that was strong internationally in product development, manufacturing, and purchasing and that could take advantage of Ford's geographical strengths throughout the world. The company had been organized geographically into three relatively independent divisions-Ford North America, Ford of Europe, and Ford Asia/Pacific. The new products cited above, Mondeo and Contour, sapped $6 billion in development costs because of expensive coordination time between the sometimes-conflicting European and North American divisions. Elimination of duplication was a goal of the new structure. Simultaneously a new "program team facility" was being constructed so that all of Ford's new product development would be by teams. The new coupe Mustang was born from an experimental cross-functional team that designed the product in less than three years compared to Ford's normal four-to-five-year development cycle. Trotman emphasized that he wanted to change the process, not just the structure, by which new products were developed. Ford apparently found the team process convincing because the Mustang was developed on a budget about 30% lower than budgets for comparable projects. SOURCE: Summarized from "Ford to Realign with a System of Global Chiefs," The Wall Street Journal, March 31, 1994, pp. A3-A4. -Refer to Case 6.0. Identify the strategy in the textbook that Ford appears to be adopting. Describe advantages and disadvantages of that strategy for Ford. Why do you think CEO Trotman moved to that strategy?

The management philosophy of a transnational model is based on interdependence rather than either full divisional independence or total divisional dependence on headquarters for decision making and control.

Discuss each of the motivations for global expansion.

List and discuss the characteristics that distinguish the transnational organization from other global organization forms.

Describe the stages of international evolution in terms of their strategic orientation.

Managers and organizations all over the world are very reluctant to cooperate to achieve competitive advantage on a global scale.

As companies begin to explore international opportunities, they typically start with an international division that grows into an export department.

The globalization strategy means that product design, manufacturing, and marketing strategy are standardized throughout the world, whereas a multidomestic strategy means that competition in each country is handled independently of competition in other countries.

Functional structures are found more frequently in a worldwide business than in a domestic business.

The GLOBE findings are notably different from Hofstede's.

The "not invented here" syndrome makes some managers reluctant to tap into the know-how and expertise of other units.

Which type of strategy would encourage production design, assembly, and marketing tailored to the needs of each country?

What are the three primary segments of the global organizational challenge? Discuss each.

Which of the following characteristics distinguishes the transnational organization from other forms of global organizations?