Question 1

The global business manager does not need to be located in the MNE's home country.

Accepted Answer

Indeed,in the true transnational company,the global business manager may not even be located in the home country and great benefits can accrue to relocating several such management groups abroad..

Question 2

In general,the global business manager,the geographic (country)subsidiary manager and the worldwide functional manager respectively cope with challenges of developing global efficiency and competitiveness,national responsiveness and flexibility,and worldwide innovation and learning capabilities.Nevertheless,it does not mean that they undertake their tasks unilaterally.

Accepted Answer

New challenges encountered by MNEs in 21ˢᵗ century require them to develop multiple strategic assets: global-scale efficiency and competitiveness,national responsiveness and flexibility,and world innovation and learning capabilities.The fundamental task of the global business manager is to see opportunities and risks across national boundaries and functional specialties,and to coordinate activities across barriers to capture the potential benefits.The country subsidiary manager needs to defend the company's market positions against global competitors,satisfy the demands of the host government,and respond to the needs of local customers.The worldwide functional manager's job is to provide support to line managers,particularly by diffusing innovations and transferring knowledge on a worldwide basis.

Question 3

Worldwide functional managers are principally responsible for diffusing products and services worldwide between the MNE's geographic units.

Accepted Answer

Worldwide functional managers have the specialist responsibility for activities like R&D,manufacturing and marketing.Their job,broadly speaking,is to diffuse innovations and transfer knowledge on a worldwide basis.

Question 4

The role of the geographic (country)subsidiary manager has become more difficult in an era of global business units and global customers due to the fact that the manager is accountable for results,but exercises limited authority over the employees and assets situated within the country.

Accepted Answer

Even though MNEs are moving more towards structures dominated by global business units and global customers,the geographic country subsidiary manager typically continues to wield only very limited formal authority over the people and assets within his or her jurisdiction.

Question 5

All of the following forces are contributing to the complexity and diversity encountered by MNEs in the 21st century,except:

Accepted Answer

The twenty-first century MNE is markedly different from its twentieth century predecessors.It has been transformed by an environment in which multiple,often conflicting forces accelerate simultaneously.The globalization of markets,the acceleration of product and technology life cycles,the assertion of national governments' demands,and,above all,the intensification of global competition have created an environment of complexity,diversity,and change for most of today's MNEs.

Question 6

In the transnational organization of today,top management must control global business management,worldwide functional management and geographic (country)subsidiary management,so that three groups would not attempt to provide divergent influence on the corporate strategies.

Accepted Answer

Top management must maintain the organizational legitimacy of each group,balance and integrate their often divergent influences,and maintain a unifying sense of purpose and direction in the face of often-conflicting needs and priorities.

Question 7

The major challenge facing all MNEs is to allocate their major strategic tasks and organizational roles among key management groups.

Accepted Answer

This statement is true as strategic task allocation and organizational role allocation among key management groups is a critical decision that all multinational enterprises (MNEs) need to make in order to operate effectively across different countries and cultures. This allocation will have an impact on the overall success or failure of the MNE in achieving its objectives.

Question 8

It is not important to assign a qualified person to the global business management role.

Accepted Answer

It is vital to assign a qualified person to the global business management role.Yet this position is sometimes created simply by elevating an otherwise unprepared domestic product division manager to a global responsibility.

Question 9

When products of high strategic importance are transferred internally between an MNE's business units,global business managers will prefer to facilitate these transfers via internal quasi-markets,rather than exerting direct control over quantities shipped and prices charged.

Accepted Answer

Direct central control over quantities shipped and prices charged is more likely for products of high strategic importance.For example,direct central control is employed by Pfizer's central coordination of quantities and pricing of the active ingredients of Viagra,or Coca-Cola's tight corporate control of the supply of Coke syrup worldwide.

Question 10

When commodity-like products are transferred internally between an MNE's business units,global business managers will principally develop internal quasi-markets to coordinate cross-border flows of materials,components and finished products.

Accepted Answer

Internal quasi-markets are the principal means of coordination with respect to commodity-like products because global product managers recognize that internal transfers should reflect the competitive conditions set by the external environment.It is not uncommon for global product managers to negotiate with the subsidiary managers of an MNE with respect to issues such as product design,price and delivery schedule in order to position the subsidiary managers to meet local market needs.

Question 11

In light of the dramatic changes in the organizational form of MNEs,which of the following do not receive enough attention from those who manage modern MNEs

Accepted Answer

While consultants and managers spend an enormous amount of time and energy analyzing environmental forces,refining global strategy and understanding the characteristics of an effective transnational organization,too little time is devoted to understanding the implications associated with the changes in the roles and responsibilities of those who manage MNEs.These changes in roles and responsibilities have emerged as a consequence of traditional hierarchical structures evolving into the transnational organizational form.

Question 12

As an information broker,the geographic (country)manager must understand the national culture well,and thereby decide how to modify the MNE's goals,strategies and values so that that they become appropriate for the local context.

Accepted Answer

As a bicultural interpreter,the geographic country manager not only must have a sensitivity to and understanding of the national culture,he or she must also be comfortable in the corporate culture at the MNE.He or she must interpret the MNE's broad goals,strategies and values to local employees.Moreover,he or she must apply corporate values and organizational processes in a way that is sensitive to local cultural norms.Meanwhile,he or she must be able to present their ideas and proposals to the headquarters in a way that reflects the MNE's overall strategy and values..

Question 13

In the transnational,worldwide functional managers are often linked most effectively through informal networks that are nurtured and maintained through frequent meetings,visits and transfers.

Accepted Answer

Through informal networks worldwide functional managers develop the contacts and relationships that enable them to transmit information rapidly around the globe.Thus the functional managers at the corporate level become the linchpins in this worldwide intelligence scanning effort and play a vital role as facilitators of communication and repositories of specialist information.

Question 14

The biggest challenge facing transnational organizations is to create a generation of managers that have the requisite skills and the perspective needed to operate in a multibusiness,multifunctional,multinational system.

Accepted Answer

This statement is true. Transnational organizations operate across multiple countries, businesses, and functions, and require managers who can navigate the complexities of these systems. Developing a new generation of managers with the necessary skills and perspective is a significant challenge for these organizations.

Question 15

Two key tasks associated with the geographic (country)manager's role as a national defender and advocate are both the responsibility for advocating the subsidiary's role in the MNE's worldwide organization and the responsibility for championing transnational innovations.

Accepted Answer

(The geographic (country) manager's role contemplates two distinct but related tasks: (i) defending national differentiation and responsiveness by ensuring that the overall corporate strategies, policies and organization processes are appropriate from the subsidiary's perspective; and (ii) advocating the subsidiary's role in the MNE's worldwide integrated system.The task of championing transnational innovations is typically the responsibility of the worldwide functional manager).

Question 16

To respond to the heightened complexity and diversity associated with managing global operations in the 21st century,MNEs can be expected to increasingly adopt organizational forms characterized by hierarchical structures which emphasize either-or choices in place of forms that emphasize flexible coordinative processes and integrated networks of assets and resources.

Accepted Answer

Traditional hierarchical structures have evolved toward organizational forms that are described as transnationals.

Question 17

To succeed in the modern international operating environment,managers must be able to do all of the following,except:

Accepted Answer

To succeed in today's international operating environment,transnational managers must be able to sense and interpret complex and dynamic environmental changes they must be able to develop and integrate multiple strategic capabilities and they must be able to build and manage complicated yet controllable organizations capable of delivering coordinated action on a worldwide basis.Top managers in transnational companies must abandon old notions of control that are based primarily on responding to below-budget financial results and,instead,strive to rely more on control mechanisms that are personal and proactive.These control mechanisms include clearly identifying and agreeing upon strategic and operational priorities,setting demanding standards and engaging in frequent informal visits to discuss operations and to identify new problems or opportunities quickly.

Question 18

Innovations can be stimulated by all of the following - revolutionary technological breakthroughs,emerging consumer trends,new competitive challenges and pending government regulations.

Accepted Answer

Most innovations start with some stimulus driving the company to respond to a perceived opportunity or threat which may emanate from technological breakthroughs,changes in consumer behaviour,shifts in the strategy of competitors,or changes in government policy and regulations.

Question 19

The global business manager alone is responsible for formulating the strategic priorities of the MNE.

Accepted Answer

There is almost certainly some need to incorporate the perspectives of geographic and functional managers who represent strategic interests that may run counter to the global business manager's drive to maximize global efficiency.

Question 20

While the global business manager must routinely incorporate the perspectives of the geographic (country)managers when formulating the MNE's global business strategy,there is no need to incorporate the perspectives of the worldwide functional managers because these perspectives are incorporated into the formulation of the broader corporate strategy.

Accepted Answer

Given that the geographic and functional managers represent strategic interests that may conflict with the global business manager's goals,there is need to incorporate the perspectives of both the geographic and functional managers.

Quiz 7: Implementing the Strategy: Building Multidimensional Capabilities