The Organization Of International Business

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Question 1
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Organizational structure refers to the totality of a firm's organization.

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Question 2
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A manager receives a bonus because the national operating subsidiary that she is in charge of exceeds its performance target. This is an example of an incentive.

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Question 3
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A decentralized organization allows managers to respond to environmental changes more quickly than in a centralized organization.

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The choice between centralization and decentralization is absolute.

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Question 5
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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.

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Question 6
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In a worldwide area structure, each area tends to be a self-contained, largely autonomous entity with its own set of value creation activities.

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Question 7
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In a worldwide product divisional structure, each division is a self-contained, largely autonomous entity with full responsibility for its own value creation activities.

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Question 8
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The worldwide product division structure may create a lack of local responsiveness.

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Question 9
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It is difficult to ascertain accountability in the global matrix structure.

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Question 10
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The need for coordination between units is greatest in firms pursuing a localization strategy.

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Question 11
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Direct contact between subunit managers is the simplest integrating mechanism.

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Question 12
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A knowledge network is a network for transmitting information within an organization that is based on formal organizational structure.

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Question 13
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The basic principle behind incentive systems is to ensure that the incentive scheme for an individual employee is linked to an output target that he or she has some control over and can influence.

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Question 14
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Performance ambiguity lowers the cost of control.

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Question 15
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New processes that might lead to a competitive advantage can be developed anywhere within the organization's global network of operations.

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Question 16
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Norms are abstract ideas about what a group believes to be good, right, and desirable.

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Question 17
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An organizational culture can be strong but bad.

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Question 18
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Firm ABC is pursuing a localization strategy that is focused on local responsiveness. Therefore, the need for integration and coordination between self-contained country subsidiaries is low.

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Question 19
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Firms pursuing a localization strategy tend to operate with an array of formal and informal integrating mechanisms.

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Question 20
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A firm's organizational architecture must be consistent with its strategy.

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