Question 1

Managers choose the manufacturing location for each product based on where the best combination of cost, quality, and technology can be attained in order to achieve ________.

Accepted Answer

The term "rationalization" refers to the strategic process of making decisions based on logical reasoning and analysis rather than emotions or personal preferences. In this context, choosing the manufacturing location based on the best combination of cost, quality, and technology is a rational decision aimed at improving efficiency and profitability.

Question 2

Which of the following is true with regard to the global geographic structure?

Accepted Answer

Marketing-oriented companies, especially those with a global focus, tend to favor a geographic structure because it allows them to tailor their marketing efforts to the needs and preferences of specific regions. This allows for a more effective marketing strategy and a greater degree of customer satisfaction. However, the other choices are inaccurate. The focus of the geographic structure is on utilizing local resources rather than importing, and problems of coordination can arise when different regions have different ways of doing things. The geographic structure can be an effective way to consolidate regional expertise, but it may not be the best structure for this purpose depending on the organization's goals and resources.

Question 3

Marketing-oriented companies, such as Nestlé and Unilever, which produce a range of products that can be marketed through similar channels of distribution to similar customers, will usually opt for the ________.

Accepted Answer

Marketing-oriented companies with a range of products that can be marketed through similar channels of distribution to similar customers will typically opt for a global geographic structure. This structure allows for centralized control and coordination of marketing efforts worldwide, resulting in economies of scale and consistency in branding and messaging across markets.

Question 4

The downside of rationalization is ________.

Accepted Answer

The downside of rationalization is a lack of differentiation and specialization for local markets, which means that products are standardized and may not effectively meet the specific needs and preferences of consumers in different regions or countries. This can lead to decreased sales and market share in those areas. The other options, high cost of production, widely varying product design, and different marketing strategies, are not necessarily downsides of rationalization, but rather challenges that companies may face in implementing a global strategy.

Question 5

Global functional structures are primarily used by small firms with highly centralized systems.

Accepted Answer

The answer of Global functional structures are primarily used by...

Question 6

Which of the following refers to focusing on and specializing in specific markets?

Accepted Answer

Differentiation refers to a business strategy of focusing on and specializing in specific markets, products, or services to differentiate itself from competitors. Integration involves combining different functions, systems, or organizations into a single entity. Implementation refers to the process of putting a plan into action. Globalization refers to the process of increasing interconnectedness and interdependence among people, businesses, and countries worldwide.

Question 7

In their rush to get on the globalization bandwagon, too many firms have ________.

Accepted Answer

The sentence suggests that some firms have prioritized globalization without acknowledging the importance of local market structures and consumer preferences. Option B directly addresses this issue. Option A and D are irrelevant to the sentence. Option C suggests the opposite of what is being discussed.

Question 8

Which of the following is the most common form of organizing foreign operations in which divisions are created to cover various regions?

Accepted Answer

The global geographic structure is the most common form of organizing foreign operations in which divisions are created to cover various regions. This allows for a greater focus on local needs and preferences while still maintaining some centralization at the corporate level. The global functional structure focuses on creating divisions based on functions, such as marketing or finance, while the global product structure focuses on creating divisions based on products or services offered. The matrix structure combines elements of both the functional and product structures.

Question 9

Which of the following refers to a problem that firms with structurally sophisticated global networks are most likely to face?

Accepted Answer

Firms with structurally sophisticated global networks usually operate in multiple countries with diverse economic, political, and social conditions, which makes them more vulnerable to changes in the global environment. Environmental volatility refers to unpredictable or unstable conditions in the global market or regulatory environment, which can create uncertainty and risk for multinational firms. This is a common problem faced by firms with complex global networks.

Question 10

The fundamental limitation of a matrix structure is that it ________.

Accepted Answer

The fundamental limitation of a matrix structure is that it institutes a dual hierarchy that violates the unity-of-command principle. This means that employees may receive conflicting orders from multiple superiors, leading to confusion, ambiguity, and a lack of accountability. This can ultimately lead to decreased efficiency and effectiveness in achieving organizational objectives.

Question 11

Diana's, an Illinois-based cosmetics company, manufactures a wide range of natural cosmetics and skin-care products.The company has international divisions located in Singapore and London.The top management at Diana's is currently considering making a change to the company's organizational structure.Which of the following, if true, best supports the argument that Diana's should change its organizational structure?

Accepted Answer

The complaint by employees that they are too involved with administrative tasks indicates that the current organizational structure may not be optimal. A change in the structure may help reduce administrative workloads and thus, enable employees to better focus on product innovation and development. Exporting products to emerging markets, low employee attrition, and a labor union negotiation success do not necessarily indicate the need for a change in organizational structure.

Question 12

Which of the following forms of organization is particularly appropriate in a dynamic and diverse environment?

Accepted Answer

The global product structure is particularly appropriate in a dynamic and diverse environment as it allows for localized decision-making and quick response to changes in the market. This structure also promotes innovation and the development of new products tailored to local needs.

Question 13

Which of the following refers to a self-contained business within a company with its own functional departments and accounting systems?

Accepted Answer

A strategic business unit (SBU) refers to a self-contained business within a company with its own functional departments and accounting systems. SBUs are often created to operate as separate entities with their own objectives, strategies, and budgets, allowing them to be more flexible and responsive to market changes.

Question 14

A specific strategy that treats the world as one market by using a standardized approach to products and markets is called ________.

Accepted Answer

Globalization is a specific strategy that treats the world as one market by using a standardized approach to products and markets. This approach assumes that customers around the world have similar needs and wants, and therefore, the company can offer the same product or service in all markets without significant adaptation. This strategy is often associated with economies of scale, cost efficiency, and brand consistency.

Question 15

Which of the following refers to the coordination of specific markets?

Accepted Answer

Integration refers to the coordination of specific markets.

Question 16

No matter what the stage of internationalization, a firm's structural choices always involve ________.

Accepted Answer

Integration and differentiation are two key structural choices that firms must make when internationalizing. Integration refers to the degree of coordination and control within the company, while differentiation refers to the degree of specialization and diversity of tasks and departments. Balancing these two choices is crucial for a firm's success in a global market. Low standardization procedures (A), vertical job specialization (C), and mass/niche marketing (D) are all important considerations for international firms but are not the primary structural choices.

Question 17

A ________ is a hybrid organization of overlapping responsibilities.

Accepted Answer

A matrix structure combines elements of both functional and divisional structures, allowing employees to report to multiple managers with varying responsibilities across different projects or products. This overlapping of responsibilities makes it a hybrid organization.

Question 18

With the geographic structure, the focus is on ________, since products can be adapted to local requirements.

Accepted Answer

The geographic structure allows for a localized approach to marketing, as products can be adapted to specific local requirements.

Question 19

The focus of Selina Inc., an MNC producing a range of products that can be marketed through common channels to similar customers worldwide, is marketing.Its aim is to become an insider in every country it operates.Which of the following organizational forms is most likely to be favored by Selina's management?

Accepted Answer

A global geographic structure allows for Selina Inc. to have different divisions or units in each country it operates, with each unit responsible for the marketing and sales of products specifically designed for that region. This structure is particularly effective for companies with a global marketing strategy as it ensures that the products are tailored to the specific needs and preferences of the customers in each country, which ultimately increases sales and revenue. Selina's focus on becoming an insider in every country it operates also suggests that a global geographic structure would be favored as it allows the company to have a local presence and adapt to local market conditions.

Question 20

The ________ the level of the company at which managers make decisions, the more that organization is ________.

Accepted Answer

The answer of The ________ the level of the company...

Quiz 8: Developing a Global Management Cadre