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 firm's organizational culture refers to the formal organizational structure of the company,the control systems and incentives in place,and the human resources component.

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Question 3

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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 4

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

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Question 5

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By centralizing decision making,a firm can avoid the duplication of activities that occurs when similar activities are carried on by various subunits within the organization.

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Question 6

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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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Question 7

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Centralization gives top-level managers the power and authority to be able to bring about needed major organizational changes.

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Question 8

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A firm pursuing a localization strategy will have a strong incentive to centralize decision- making.

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Question 9

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The choice between centralization and decentralization is not absolute.

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Question 10

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In firms pursuing a transnational strategy,some operating decisions are relatively centralized,while others are relatively decentralized.

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Question 11

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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 12

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Regardless of a firm's domestic structure,its international division tends to be organized on economy.

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Question 13

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The worldwide area structure tends to be adopted by firms with a low level of diversification whose domestic structures are based on functions.

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Question 14

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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 15

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A worldwide product division structure tends to be adopted by firms that are reasonably diversified and originally had domestic structures based on product divisions.

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Question 16

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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 17

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The worldwide product division structure facilitates local responsiveness.

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Question 18

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

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Question 19

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

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Question 20

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

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