Question 1

Global strategy is an approach to internationalization in which headquarters delegates considerable autonomy to each country manager, allowing him or her to operate independently and pursue local responsiveness,

Accepted Answer

Global strategy typically involves centralizing operations and maintaining high levels of integration and standardization across countries, rather than delegating considerable autonomy to each country manager for local responsiveness.

Question 2

The home replication strategy is often employed as a means of extending a product's life cycle in a foreign market and to replicate home-market success, as it views expansion abroad as an opportunity to generate additional sales for domestic product lines.

Accepted Answer

The home replication strategy involves using a successful domestic product strategy in foreign markets to extend its life cycle and increase sales.

Question 3

Extra Clean Strategy (Scenario)
Extra Clean Soap Company has been manufacturing soap products, such as dishwashing liquid, bath soap, and shampoo, for over 20 years from its facility and headquarters in Dublin, Ireland. A recent opportunity allowed Extra Clean to purchase soap companies in Taiwan and India. Extra Clean is now servicing both foreign and domestic markets with its products and manufacturing in all three locations. Recent reports from managers in the foreign facilities indicate that Extra Clean sales in Taiwan and India are low due to a lack of local responsiveness. Extra Clean managers from Ireland, India, and Taiwan are having a teleconference in an attempt to devise a strategy to improve the profitability of Extra Clean.
-Which of the following most likely supports Extra Clean implementing a multidomestic strategy instead of a global strategy?

Accepted Answer

A multidomestic strategy focuses on adapting products and strategies to fit the specific needs and preferences of local markets. The lack of internationalization experience among Extra Clean managers suggests that a multidomestic strategy, which requires understanding and responding to local conditions, might be more suitable than a global strategy, which emphasizes uniformity and efficiency across markets.

Question 4

By standardizing international operations as much as possible, yet being adaptable to the needs of local markets, a firm is utilizing a transnational strategy of globalization.

Accepted Answer

A transnational strategy of globalization involves balancing the need for efficiency in global operations with the need to adapt products and services to local markets, thus standardizing where possible while remaining flexible to local needs.

Question 5

Converging buyer characteristics, growing acceptance of global brands, and increased diffusion of uniform technology make it difficult to pursue a global strategy.

Accepted Answer

These factors actually facilitate the implementation of a global strategy by making it easier for companies to offer similar products or services across various markets.

Question 6

When using a home replication strategy, firms delegate autonomy to managers in each foreign unit, allowing them to operate independently and pursue local responsiveness.

Accepted Answer

In a home replication strategy, firms apply the same business model and practices abroad as they do at home, rather than adapting to local markets and delegating autonomy to foreign unit managers.

Question 7

Armaz Inc., a manufacturing company, has its headquarters located in Texas, U.S., and subsidiaries in India, China, and Vietnam. Which of the following decisions will be the LEAST decentralized?

Accepted Answer

The decision about hiring a marketing manager in the United States is the least decentralized because it is a decision that is made at the headquarters level and not at the subsidiary level.

Question 8

Which of the following gives headquarters considerable authority and control over the firm's activities worldwide?

Accepted Answer

A centralized approach gives headquarters considerable authority and control over the firm's activities worldwide, as decisions are made at the central hub and then implemented across all locations.

Question 9

Armaz Inc., a manufacturing company, has its headquarters located in Texas, U.S., and subsidiaries in India, China, and Vietnam. Which of the following decisions will be the MOST centralized?

Accepted Answer

Centralized decisions are those made at the highest or most central level of an organization. The decision about building factories in Cambodia would likely be made at the headquarters in Texas, as it involves significant investment and strategic planning affecting the company as a whole.

Question 10

Extra Clean Strategy (Scenario)
Extra Clean Soap Company has been manufacturing soap products, such as dishwashing liquid, bath soap, and shampoo, for over 20 years from its facility and headquarters in Dublin, Ireland. A recent opportunity allowed Extra Clean to purchase soap companies in Taiwan and India. Extra Clean is now servicing both foreign and domestic markets with its products and manufacturing in all three locations. Recent reports from managers in the foreign facilities indicate that Extra Clean sales in Taiwan and India are low due to a lack of local responsiveness. Extra Clean managers from Ireland, India, and Taiwan are having a teleconference in an attempt to devise a strategy to improve the profitability of Extra Clean.
-Which of the following questions would be most important for Extra Clean managers to evaluate the integration-responsiveness framework?

Accepted Answer

The integration-responsiveness framework focuses on balancing global integration and local responsiveness. Question D directly addresses this balance, making it the most relevant for evaluating the framework in the context of improving Extra Clean's profitability in foreign markets.

Question 11

In which of the following are substantial autonomy and decision-making authority delegated to a firm's subsidiaries around the world?

Accepted Answer

In a decentralized approach, substantial autonomy and decision-making authority are delegated to a firm's subsidiaries, allowing them to operate independently and make decisions that best suit their local markets.

Question 12

In a multidomestic strategy, there is maximum pressure on headquarters staff because there is little incentive for decision making by individual managers.

Accepted Answer

In a multidomestic strategy, decision-making is often decentralized to the individual country units, allowing for more local responsiveness and less pressure on headquarters staff for day-to-day operations.

Question 13

Discuss the advantages and implementation of a transnational strategy, and explain why this strategy is closely associated with a global matrix structure.

Accepted Answer

The answer of Discuss the advantages and implementation of a...

Question 14

A firm's headquarters is the primary contributor to ________.

Accepted Answer

The firm's headquarters is primarily responsible for capital planning, as it involves strategic financial decisions and resource allocation that are typically centralized at the corporate level.

Question 15

When using a multidomestic strategy, products and services are carefully adapted to suit the unique needs of each country.

Accepted Answer

A multidomestic strategy involves customizing products, marketing strategies, and business operations to fit the specific needs and preferences of each country in which a company operates, acknowledging and adapting to local differences.

Question 16

Extra Clean Strategy (Scenario)
Extra Clean Soap Company has been manufacturing soap products, such as dishwashing liquid, bath soap, and shampoo, for over 20 years from its facility and headquarters in Dublin, Ireland. A recent opportunity allowed Extra Clean to purchase soap companies in Taiwan and India. Extra Clean is now servicing both foreign and domestic markets with its products and manufacturing in all three locations. Recent reports from managers in the foreign facilities indicate that Extra Clean sales in Taiwan and India are low due to a lack of local responsiveness. Extra Clean managers from Ireland, India, and Taiwan are having a teleconference in an attempt to devise a strategy to improve the profitability of Extra Clean.
-Which of the following most likely supports Extra Clean implementing a transnational strategy?

Accepted Answer

The answer of Extra Clean Strategy (Scenario)
Extra Clean Soap Company...

Question 17

A firm's subsidiary is the primary contributor to ________.

Accepted Answer

The answer of A firm's subsidiary is the primary contributor...

Question 18

Explain the benefits of a multidomestic strategy to firm internationalization. What are some of the disadvantages to this approach?

Accepted Answer

The answer of Explain the benefits of a multidomestic strategy...

Question 19

Global strategy is an approach to internationalization in which headquarters seeks substantial control over its country operations to minimize redundancy and achieve maximum efficiency, learning, and integration worldwide.

Accepted Answer

Global strategy involves centralizing operations and maintaining high levels of control over all aspects of the business to ensure efficiency, consistency, and integration across all markets in which the company operates. This approach aims to leverage global scale and coordination to achieve competitive advantage.

Question 20

In establishing a firm's organizational structure, a fundamental issue is ________.

Accepted Answer

A fundamental issue in establishing a firm's organizational structure is determining the extent of decision-making responsibility that should be retained at headquarters versus delegated to other parts of the organization.

Quiz 11: Strategy and Organization in the International Firm