Question 1

A transnational team is a work group comprising multinational members whose activities span multiple countries.

Accepted Answer

This statement defines a transnational team as a group of multinational members working across multiple countries, which makes it a true statement.

Question 2

Low uncertainty avoidance means that people have a high tolerance for the unstructured, the unclear, and the unpredictable.

Accepted Answer

Low uncertainty avoidance cultures tend to be more open to change and innovation, and are comfortable with ambiguity and risk-taking. They are also more likely to be accepting of different ideas and beliefs.

Question 3

High uncertainty avoidance means that people accept inequality in power among institutions, organizations, and people.

Accepted Answer

High uncertainty avoidance actually means that people have a low tolerance for ambiguity and prefer predictable situations. It does not necessarily imply a acceptance of inequality in power.

Question 4

Functional managers coordinate across functions, whereas country managers coordinate among countries.

Accepted Answer

Functional managers coordinate within their own function, such as marketing or human resources. Country managers, on the other hand, oversee operations in a specific country and coordinate with other country managers within the same company.

Question 5

Hybrid structures are typical in highly volatile environments.

Accepted Answer

Hybrid structures, which combine elements of different organizational models, are often utilized in rapidly changing and unpredictable environments where flexibility and adaptability are key.

Question 6

The transnational model reflects the ultimate in both organizational complexity, with many diverse units, and organizational coordination, with mechanisms for integrating the varied parts.

Accepted Answer

The transnational model is characterized by organizational complexity, with various units, and organizational coordination, with mechanisms that integrate the different parts.

Question 7

A growing number of global consumers are rejecting the notion of homogenized products and services, and calling for greater response to local preferences.

Accepted Answer

This statement is true. As the world becomes increasingly interconnected, consumers are becoming more aware of their cultural heritage and are thus seeking more localized products and services. This trend is known as "glocalization," which refers to the adaptation of global products and services to local cultural preferences.

Question 8

The global product structure works best when pressure for decision-making balances the interests of both product standardization and geographical localization, and when coordination to share resources is important.

Accepted Answer

The answer of The global product structure works best when...

Question 9

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. Comment on any difficulties Ford might encounter in adopting the philosophy and behaviour of a horizontal corporation as the company made the structural change CEO Trotman outlined.

Accepted Answer

The answer of Case 6.0
It was reported in the Wall...

Question 10

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. Describe how Ford's proposed structural changes are different from the usual progression through the stages resulting from international development. Describe how Ford's proposed structural changes parallel the new designs for domestic and global advantage.

Accepted Answer

The answer of Case 6.0
It was reported in the Wall...

Question 11

The product-based structure works best when a division handles products that are technologically similar and can be standardized for marketing around the world.

Accepted Answer

The product-based structure groups units based on similarities of the products they handle. This structure works best when the products are technologically similar and can be standardized for marketing around the world.

Question 12

With a global geographical structure, each division's manager is responsible for planning, organizing, and controlling all functions for the production and distribution of its products for any market around the world.

Accepted Answer

The answer of With a global geographical structure, each division's...

Question 13

Network coordinators would enable a manufacturing organization to provide knowledge and integrated solutions across multiple businesses, divisions, and countries for a large customer.

Accepted Answer

Network coordinators can facilitate communication and collaboration among different parts of the organization, which could be beneficial in providing integrated solutions to a large customer that operates in multiple countries and business units.

Question 14

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.

Accepted Answer

The statement is correct. The transnational management philosophy emphasizes the importance of interdependence and collaboration between headquarters and divisional units, rather than relying solely on one or the other for decision making and control.

Question 15

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

Accepted Answer

The "not invented here" syndrome refers to the reluctance of some managers to utilize knowledge or expertise from outside their own unit, so the statement is true.

Question 16

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

Accepted Answer

This statement is true, as the global geographical structure is a common way for multinational corporations to organize their operations based on different regions around the world. Each region is typically headed by a regional director or manager who reports to the CEO or a higher-level executive.

Question 17

The GLOBE findings are notably different from Hofstede's.

Accepted Answer

The answer of The GLOBE findings are notably different from...

Question 18

In many instances, companies will need to respond to both global and local opportunities simultaneously, in which case the global matrix structure can be used.

Accepted Answer

The global matrix structure is designed to allow companies to respond to both global and local opportunities simultaneously.

Question 19

European companies tend to have international units that have a high level of independence.

Accepted Answer

It is common for European companies to have decentralized structures, where international units have a high level of autonomy and decision-making power. This allows for more effective adaptation to local markets and customer needs.

Question 20

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?

Accepted Answer

The answer of Case 6.0
It was reported in the Wall...

Quiz 6: Designing Organizations for the International Environment

A transnational team is a work group comprising multinational members whose activities span multiple countries.

Low uncertainty avoidance means that people have a high tolerance for the unstructured, the unclear, and the unpredictable.

High uncertainty avoidance means that people accept inequality in power among institutions, organizations, and people.

Functional managers coordinate across functions, whereas country managers coordinate among countries.

Hybrid structures are typical in highly volatile environments.

The transnational model reflects the ultimate in both organizational complexity, with many diverse units, and organizational coordination, with mechanisms for integrating the varied parts.

A growing number of global consumers are rejecting the notion of homogenized products and services, and calling for greater response to local preferences.

The global product structure works best when pressure for decision-making balances the interests of both product standardization and geographical localization, and when coordination to share resources is important.

The product-based structure works best when a division handles products that are technologically similar and can be standardized for marketing around the world.

With a global geographical structure, each division's manager is responsible for planning, organizing, and controlling all functions for the production and distribution of its products for any market around the world.

Network coordinators would enable a manufacturing organization to provide knowledge and integrated solutions across multiple businesses, divisions, and countries for a large customer.

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.

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

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

The GLOBE findings are notably different from Hofstede's.

In many instances, companies will need to respond to both global and local opportunities simultaneously, in which case the global matrix structure can be used.

European companies tend to have international units that have a high level of independence.