Question 1

Explain the five reasons why a firm should decentralize its decision-making.

Accepted Answer

Firms should decentralize their decision

Question 2

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

Question 3

The worldwide product division structure:

Accepted Answer

A)  is weak in local responsiveness. 
B)  inhibits the realization of location economies. 
C)  inhibits the realization of experience curve economies. 
D)  limits the transfer of core competencies between areas. 
A)  is weak in local responsiveness. 
B)  inhibits the realization of location economies. 
C)  inhibits the realization of experience curve economies. 
D)  limits the transfer of core competencies between areas.

Question 4

The manner in which decisions are made and work is performed within the organization is known as the firm's _____.

Accepted Answer

A)  organizational culture 
B)  incentives 
C)  control systems 
D)  processes 
A)  organizational culture 
B)  incentives 
C)  control systems 
D)  processes

Question 5

Because of inertia forces, _____ is often no change.

Accepted Answer

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

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

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. 
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 8

Organizational structure includes several elements. Which of the following is one of them?

Accepted Answer

A)  The establishment of integrating mechanisms to coordinate the activities of subunits. 
B)  The horizontal decision-making that occurs daily, for example, on the plant floor to improve operations. 
C)  The manner in which decisions are made and work is performed by individuals. 
D)  The informal division of the organization into cultural groups. 
A)  The establishment of integrating mechanisms to coordinate the activities of subunits. 
B)  The horizontal decision-making that occurs daily, for example, on the plant floor to improve operations. 
C)  The manner in which decisions are made and work is performed by individuals. 
D)  The informal division of the organization into cultural groups.

Question 9

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

Question 10

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 fragmentation of the organization that makes it difficult to realize location and experience curve economies. 
D)  It does not facilitate local responsiveness. 
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 fragmentation of the organization that makes it difficult to realize location and experience curve economies. 
D)  It does not facilitate local responsiveness.

Question 11

Centralization and decentralization differ because:

Accepted Answer

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

Question 12

In the classic global matrix structure, horizontal differentiation proceeds along two dimensions. These dimensions are:

Accepted Answer

A)  hierarchy and overall strategy. 
B)  target returns and sales potential. 
C)  marketing strategy and sales potential. 
D)  product division and geographic area. 
A)  hierarchy and overall strategy. 
B)  target returns and sales potential. 
C)  marketing strategy and sales potential. 
D)  product division and geographic area.

Question 13

The emphasis on local responsiveness in firms pursuing a localization strategy creates strong pressures for:

Accepted Answer

A)  centralizing all decisions regarding marketing, R&D, and human resource management. 
B)  decentralizing operating decisions to foreign subsidiaries. 
C)  centralizing all operating decisions. 
D)  global learning. 
A)  centralizing all decisions regarding marketing, R&D, and human resource management. 
B)  decentralizing operating decisions to foreign subsidiaries. 
C)  centralizing all operating decisions. 
D)  global learning.

Question 14

The need for coordination is high in:

Accepted Answer

A)  firms trying to pursue localization strategies. 
B)  international firms. 
C)  firms trying to profit from location and experience curve economies. 
D)  domestic corporations. 
A)  firms trying to pursue localization strategies. 
B)  international firms. 
C)  firms trying to profit from location and experience curve economies. 
D)  domestic corporations.

Question 15

The establishment of integrating mechanisms that coordinate subunits is a dimension of _____.

Accepted Answer

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

Question 16

Performance ambiguity lowers the cost of control.

Accepted Answer

A) True 
 B)False

Question 17

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

Accepted Answer

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

Question 18

In a company using _____, employees tend to control their own behavior, which reduces the need for direct supervision.

Accepted Answer

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

Question 19

Consider the use of personal controls in international firms. In which type of firm is this control most common?

Accepted Answer

Personal control is control by personal

Question 20

The choice between centralization and decentralization is not absolute.

Accepted Answer

A) True 
 B)False

Explain the five reasons why a firm should decentralize its decision-making.

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

The worldwide product division structure:

The manner in which decisions are made and work is performed within the organization is known as the firm's _____.

Because of inertia forces, _____ is often no change.

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

Centralization:

Organizational structure includes several elements. Which of the following is one of them?

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.

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

Centralization and decentralization differ because:

In the classic global matrix structure, horizontal differentiation proceeds along two dimensions. These dimensions are:

The emphasis on local responsiveness in firms pursuing a localization strategy creates strong pressures for:

The need for coordination is high in:

The establishment of integrating mechanisms that coordinate subunits is a dimension of _____.

Performance ambiguity lowers the cost of control.

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

In a company using _____, employees tend to control their own behavior, which reduces the need for direct supervision.

Consider the use of personal controls in international firms. In which type of firm is this control most common?

The choice between centralization and decentralization is not absolute.

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Foreign Direct Investment

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

Filters

Exam 14: The Organization of International Business

Explain the five reasons why a firm should decentralize its decision-making.

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

The worldwide product division structure:

The manner in which decisions are made and work is performed within the organization is known as the firm's _____.

Because of inertia forces, _____ is often no change.

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

Centralization:

Organizational structure includes several elements. Which of the following is one of them?

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.

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

Centralization and decentralization differ because:

In the classic global matrix structure, horizontal differentiation proceeds along two dimensions. These dimensions are:

The emphasis on local responsiveness in firms pursuing a localization strategy creates strong pressures for:

The need for coordination is high in:

The establishment of integrating mechanisms that coordinate subunits is a dimension of _____.

Performance ambiguity lowers the cost of control.

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

In a company using _____, employees tend to control their own behavior, which reduces the need for direct supervision.

Consider the use of personal controls in international firms. In which type of firm is this control most common?

The choice between centralization and decentralization is not absolute.

Globalization

National Differences in Political Economy, and Legal Systems

National Differences in Economic Development

Differences in Culture

Ethics, Corporate Social Responsibility, and Sustainability

International Trade Theory

Government Policy and International Trade

Foreign Direct Investment

Regional Trade Pacts Give the Mexican Auto Industry an Edge

The Foreign Exchange Market

The International Monetary System

The Global Capital Market

The Strategy of International Business

Entry Strategy and Strategic Alliances

Exporting, Importing, and Countertrade

Global Production and Supply Chain Management

Global Marketing and RD

Global Human Resource Management

Accounting and Finance in the International Business

Filters