Chapter+08 - Cross Culture Management test bank PDF

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International Management, 7e (Deresky) Chapter 8: Organization Structure and Control Systems 1) What led Samsung to reorganize in 2009? A) failed joint ventures B) foreign trade restrictions C) global economic conditions D) emerging market competition Answer: C Diff: 2 Page Ref: 257 Chapter: 8 Skill: Concept 2) What was the primary aspect of Samsung's 2009 reorganization? A) consolidating business operations into two operating divisions B) outsourcing all of its semiconductor manufacturing C) reducing its international work force by half D) forming an alliance with Motorola Answer: A Diff: 2 Page Ref: 257 Chapter: 8 Skill: Concept 3) Based on Samsung's 2009 reorganization, which of the following best describes the firm's new strategy? A) decreasing political risk B) controlling and improving cash flow C) increasing bureaucratic controls and levels D) competing aggressively in the electronics market Answer: B Diff: 2 Page Ref: 257 Chapter: 8 Skill: Concept 4) Structure must fit an organization's ________, or it will not work. A) environment B) traditions C) culture D) strategy Answer: D Diff: 1 Page Ref: 257 Chapter: 8 Skill: Concept

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5) Which of the following is the LEAST relevant variable to consider in organizational design? A) corporate strategy B) business size C) labor market D) business practices Answer: C Diff: 2 Page Ref: 258 Chapter: 8 Skill: Concept 6) ________ is the process by which a firm gradually changes in response to the imperatives of international competition, domestic market saturation, and desire for expansion. A) Organizing B) Strategy C) Localizing D) Internationalization Answer: D Diff: 1 Page Ref: 258 Chapter: 8 Skill: Concept 7) Firms typically internationalize in response to all of the following EXCEPT ________. A) need for diversification B) affects of governmentalism C) increased global competition D) domestic market saturation Answer: B Diff: 2 Page Ref: 258 Chapter: 8 Skill: Concept 8) Small firms typically begin their international involvement by ________. A) exporting B) franchising C) outsourcing D) forming joint ventures Answer: A Diff: 1 Page Ref: 258 Chapter: 8 Skill: Concept

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9) The stages model is best described as the stages of change in an organizational structure that ________. A) link markets within cultural regions B) identify the risks faced by firms that are globalizing C) follow the evolution of the internationalization process D) control the strategic decisions made by global managers Answer: C Diff: 3 Page Ref: 258 Chapter: 8 Skill: Concept 10) Which of the following is NOT a stage in Stopford's stages model? A) global product structure B) matrix structure C) international division D) regional structure Answer: D Diff: 2 Page Ref: 258 Chapter: 8 Skill: Concept 11) Which of the following structures represents the most common way that small firms enter the global market? A) domestic structure plus export department B) domestic structure plus foreign subsidiary C) international division D) matrix structure Answer: A Diff: 2 Page Ref: 258 Chapter: 8 Skill: Concept

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12) Sedona Industries is a U.S. firm that manufactures high-quality handbags, luggage, and belts from its facility in Arizona. Sedona's products have been featured in various fashion magazines, and as a result, consumer demand has increased significantly. Currently, Sedona is organized as a domestic structure plus export department. Executives at Sedona believe the firm is ready to internationalize its operations, and they are considering various organizational structures. Which of the following best supports the argument that Sedona should reorganize into a domestic structure plus foreign subsidiary? A) Sedona executives want to open numerous subsidiaries in both Europe and Asia. B) Sedona is a family-owned business which began as an entrepreneurial enterprise. C) Sedona executives are prepared to give subsidiary managers significant autonomy. D) Sedona conducts a large percentage of domestic sales through the company's website. Answer: C Diff: 3 Page Ref: 258-259 Chapter: 8 Skill: Critical Thinking AACSB: Reflective Thinking 13) Sedona Industries is a U.S. firm that manufactures high-quality handbags, luggage, and belts from its facility in Arizona. Sedona's products have been featured in various fashion magazines, and as a result, consumer demand has increased significantly. Currently, Sedona is organized as a domestic structure plus export department. Executives at Sedona believe the firm is ready to internationalize its operations, and they are considering various organizational structures. Which of the following best supports the argument that Sedona should reorganize into a global functional structure? A) Sedona uses a decentralized system of management. B) Sedona uses a variety of technologies for its products. C) Sedona has a limited number of domestic competitors. D) Sedona has a narrow spectrum of customers that it serves. Answer: D Diff: 3 Page Ref: 258-259 Chapter: 8 Skill: Critical Thinking AACSB: Reflective Thinking 14) An international division may be organized along what lines? A) vertical and horizontal B) differentiated and integrated C) centralized and decentralized D) functional, product, geographic Answer: D Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept

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15) An international division with an integrated global structure can be organized along all of the following lines EXCEPT ________. A) functional lines B) product lines C) geographic lines D) cultural lines Answer: D Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept 16) The creation of a(n) ________ facilitates the beginning of a global strategy by allowing managers to coordinate resources for foreign activities from one location. A) local division B) international division C) transnational division D) matrix division Answer: B Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept 17) A firm that uses an international division structure may experience conflict among all of its divisions because ________. A) the structure type is not very efficient B) the international division fails to respond to cultural differences C) more resources tend to be provided to the international division D) fewer resources tend to be provided to the international division Answer: C Diff: 3 Page Ref: 259 Chapter: 8 Skill: Concept 18) In which of the following are a firm's foreign operations integrated into the activities and responsibilities of each department to gain functional specialization and economies of scale? A) matrix structure B) international division C) global divisional structure D) global functional structure Answer: D Diff: 1 Page Ref: 259 Chapter: 8 Skill: Concept

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19) Company XYZ is a small firm with a highly centralized system and a narrow spectrum of customers. It most likely has a ________ structure. A) global geographic B) global product C) global functional D) global cultural Answer: C Diff: 2 Page Ref: 259 Chapter: 8 Skill: Application 20) Which of the following forms of organization is particularly appropriate for product lines using similar technology and for businesses with a narrow spectrum of customers? A) global functional structure B) global product structure C) global geographic structure D) global market structure Answer: A Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept 21) The advantages of the ________ structure are market concentration, innovation, and responsiveness to new opportunities in a particular environment. A) global functional B) global product C) global geographic D) global cultural Answer: B Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept 22) Which of the following terms refers to a self-contained business within a company with its own functional departments and accounting systems? A) subsidiary B) product division C) corporate division D) strategic business unit Answer: D Diff: 1 Page Ref: 259 Chapter: 8 Skill: Concept

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23) In a global product division, each strategic business unit (SBU) is responsible for ________ and ________. A) marketing; sales B) production; sales C) human resources; production D) risk management; accounting Answer: B Diff: 2 Page Ref: 259 Chapter: 8 Skill: Concept 24) In a global geographic structure, decisions are primarily made by ________. A) local managers B) home country executives C) product line managers D) regional marketing teams Answer: A Diff: 2 Page Ref: 260 Chapter: 8 Skill: Concept 25) What is the most common form of organizing foreign operations? A) global functional structure B) global geographic structure C) global product structure D) matrix structure Answer: B Diff: 2 Page Ref: 260 Chapter: 8 Skill: Concept 26) The primary advantage of a global geographic structure is the firm's ability to ________. A) ensure economies of scale in production B) adapt products to local needs and demands C) implement international policies and procedures D) coordinate marketing across many geographic regions Answer: B Diff: 2 Page Ref: 260 Chapter: 8 Skill: Concept AACSB: Use of IT

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27) Marketing-oriented companies like Nestle and Unilever are more likely to use a ________ structure because products can be adapted to local requirements. A) global functional B) global geographic C) matrix D) domestic Answer: B Diff: 2 Page Ref: 260 Chapter: 8 Skill: Concept 28) Which organizational form is a hybrid structure with overlapping responsibilities? A) international division B) divisional structure C) area structure D) matrix structure Answer: D Diff: 1 Page Ref: 261 Chapter: 8 Skill: Concept 29) Which of the following is a true statement about the matrix structure of organizational design? A) Personnel skills and experience are maximized. B) Personnel responsibilities and accountability are clarified. C) Communication problems, confusion, and conflict are minimal. D) Lines of responsibility are drawn only in a vertical direction. Answer: A Diff: 3 Page Ref: 261 Chapter: 8 Skill: Concept 30) Regardless of the stage of internationalization, a firm's structural choices always involve which two opposing forces? A) strategy and operations B) integration and differentiation C) globalization and localization D) procedures and implementation Answer: B Diff: 2 Page Ref: 262 Chapter: 8 Skill: Concept

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31) Which of the following terms refers to focusing on and specializing in specific markets? A) integration B) implementation C) differentiation D) globalization Answer: C Diff: 1 Page Ref: 262 Chapter: 8 Skill: Concept 32) Which of the following terms refers to the coordination of markets? A) differentiation B) globalization C) expropriation D) integration Answer: D Diff: 1 Page Ref: 262 Chapter: 8 Skill: Concept 33) A specific strategy that treats the world as one market by using a standardized approach to products and markets is called ________. A) globalization B) rationalization C) differentiation D) integration Answer: A Diff: 1 Page Ref: 262 Chapter: 8 Skill: Concept 34) By selecting the manufacturing location for each product based on where the best combination of cost, quality, and technology can be obtained, a firm will most likely achieve ________. A) differentiation B) integration C) globalization D) rationalization Answer: D Diff: 1 Page Ref: 262 Chapter: 8 Skill: Concept

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35) What is the primary disadvantage of rationalization? A) too much emphasis on centralized decision making B) potential profit loss due to different product designs C) too many different marketing and sales programs D) lack of differentiation and specialization for local markets Answer: D Diff: 3 Page Ref: 262 Chapter: 8 Skill: Concept 36) What is the greatest risk for firms that have structurally sophisticated global networks? A) environmental volatility B) competition from domestic firms C) shortages of experienced personnel D) implementation of corporate policies Answer: A Diff: 2 Page Ref: 263 Chapter: 8 Skill: Concept 37) The organizational structure of Levi Strauss is best described as a ________. A) domestic structure plus export department with multiple products B) global-local format that allows local managers to act independently C) global product structure that produces a single product from one facility D) matrix structure that seeks unification among all of its products and marketing Answer: B Diff: 3 Page Ref: 264 Chapter: 8 Skill: Concept 38) The purpose of proctor & Gamble's Four Pillars organizational structure is to enable it to ________. A) form four international joint ventures B) establish subsidiaries on four continents C) think locally and act globally D) think globally and act locally Answer: D Diff: 2 Page Ref: 264 Chapter: 8 Skill: Concept AACSB: Use of IT

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39) Which of the following is NOT one of proctor & Gamble's Four Pillars? A) Global Business Units B) Global Business Services C) International Technology Units D) Market Development Organizations Answer: C Diff: 1 Page Ref: 265 Chapter: 8 Skill: Concept 40) Infosys, Lenovo, and Tata Motors are examples of ________. A) emerging market companies B) strategic business units C) maquiladoras D) SMEs Answer: A Diff: 1 Page Ref: 266 Chapter: 8 Skill: Concept 41) Many emerging market companies are avoiding the traditional method of internationalization and instead capitalizing on the ________. A) opportunities in China and Russia B) reduction in trade barriers C) born global phenomenon D) offshoring opportunities Answer: C Diff: 2 Page Ref: 267 Chapter: 8 Skill: Concept 42) What was the origin of most emergent market companies? A) family businesses B) multinational firms C) franchises D) joint ventures Answer: A Diff: 1 Page Ref: 267 Chapter: 8 Skill: Concept

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43) Which of the following is a major structural changes occurring within many emerging market companies, such as Lenovo and Mittal Steel? A) expanding family ownerships B) establishing foreign franchises C) simplifying traditional hierarchies D) decreasing the powers of subsidiaries Answer: C Diff: 2 Page Ref: 267 Chapter: 8 Skill: Concept 44) The organizational structure at Intel which involves customizing a range of chips in a combination suitable for a particular target market is known as ________. A) I-form B) integration C) platformisation D) specialization Answer: C Diff: 2 Page Ref: 267 Chapter: 8 Skill: Concept 45) Royal Phillips Electronics' structure would best be described as a(n) ________. A) domestic structure plus export department B) international division C) global functional structure D) network structure Answer: D Diff: 2 Page Ref: 267 Chapter: 8 Skill: Concept 46) Which of the following is a characteristic of Intel's organizational structure? A) rigidly formal hierarchy B) fairly autonomous divisions C) highly centralized system D) global divisional structure Answer: B Diff: 2 Page Ref: 268 Chapter: 8 Skill: Concept

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47) Dell Computer uses the Internet to streamline the global supply system, which has the result of ________. A) improving the efficiency of the supply chain B) eliminating the reliance on local suppliers C) creating a vertical hierarchical structure D) eliminating the use of brick and mortar services Answer: A Diff: 2 Page Ref: 269 Chapter: 8 Skill: Concept 48) All of the following are characteristics of a firm with transnational capability EXCEPT ________. A) local flexibility B) global integration C) centralized vertical structure D) ability to manage across borders Answer: C Diff: 2 Page Ref: 269 Chapter: 8 Skill: Concept 49) Which of the following is an essential element of the transnational structure of Asea-Brown Boveri (ABB)? A) reliable system of suppliers B) lateral communication network C) top-down decision-making process D) hierarchical communication network Answer: B Diff: 2 Page Ref: 269-270 Chapter: 8 Skill: Concept 50) Which of the following organizational structures is typical of most transnational companies? A) matrix structure B) international division C) global product structure D) global functional structure Answer: A Diff: 2 Page Ref: 270 Chapter: 8 Skill: Concept

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51) What are the two major variables that determine the structure and design of an organization? A) globalization and localization B) localization and nationalization C) nationalization and rationalization D) rationalization and globalization Answer: A Diff: 2 Page Ref: 270 Chapter: 8 Skill: Concept 52) As a company becomes larger, more complex, and more sophisticated in its approach to world markets, it will most likely evolve into a(n) ________. A) matrix corporation B) domestic corporation C) international corporation D) transnational corporation Answer: D Diff: 2 Page Ref: 270-271 Chapter: 8 Skill: Concept 53) The ________ strategy involves maximizing opportunities for both efficiency and local responsiveness by adopting a structure that uses alliances, networks, and horizontal design formats. A) multidomestic B) transnational C) international D) globalization Answer: B Diff: 1 Page Ref: 271 Chapter: 8 Skill: Concept 54) With a globalization strategy, the need for complex integrating mechanisms is ________, and in a multi-domestic strategy, the need is ________. A) high; low B) low; high C) high; medium D) medium; very high Answer: A Diff: 3 Page Ref: 271 Chapter: 8 Skill: Concept

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55) With a transnational strategy, the need for complex integrating mechanisms is ________, and in an international strategy, the need is ________. A) very high; very low B) very low; high C) very high; medium D) medium; very high Answer: C Diff: 3 Page Ref: 271 Chapter: 8 Skill: Concept 56) With a transnational strategy, the role of organizational culture is ________, and in a multidomestic strategy, the role of organizational culture is ________. A) not important; slightly important B) not important; very important C) very important; not important D) slightly important; very important Answer: C Diff: 3 Page Ref: 271 Chapter: 8 Skill: Concept 57) In most international organizations, decisions regarding ________ functions are centralized. A) sales B) finance C) marketing D) production Answer: B Diff: 2 Page Ref: 271 Chapter: 8 Skill: Concept 58) Which of the following is most likely NOT an indication that changes need to be made to a firm's organizational design? A) customer service complaints B) overlapping responsibilities C) morale problems D) tight budgets Answer: D Diff: 2 Page Ref: 271-272 Chapter: 8 Skill: Concept

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59) All of the following are signs of international organizational malaise EXCEPT ________. A) clashes among divisions, subsidiaries, and individuals B) duplication of administrative personnel and services C) greater demands for information systems D) unclear lines of reporting Answer: C Diff: 2 Page Ref: 272 Chapter: 8 Skill: Concept 60) Contingency theory proposes that the best organizational structure is that which ________. A) enables a firm to globalize quickly B) leads to a high-efficiency work system C) provides for balanced control of subsidiaries D) allows the firm to carry out its strategic goals Answer: D Diff: 3 Page Ref: 272 Chapter: 8 Skill: Concept 61) Which of the following is NOT necessarily a characteristic of the best organizational structure for a firm? A) dynamic B) global C) adaptable D) flexible Answer: B Diff: 2 Page Ref: 272 Chapter: 8 Skill: Concept 62) According to the author, the future for MNC structure most likely lies in a ________. A) global web of networked companies B) global functional structure C) global product structure D) centralized hierarchy Answer: A Diff: 2 Page Ref: 272 Chapter: 8 Skill: Concep...