58) The term bamboo ceiling refers to ________.
A) the exclusion of host nationals from strategic decision making in centrally controlled
Japanese subsidiaries
B) the reluctance of Japanese managers to allow centralized decision making among their
subordinates
C) the lack of information flow from the Japanese-owned subsidiaries in foreign countries back
to headquarters in Japan
D) the tendency of Japanese firms to delegate decisions more frequently than European or
American firms
59) Pfizer, a pharmaceutical company, operates in over 40 countries around the world, and many
of the larger-country units enjoy considerable freedom and autonomy. Thus, it can be said that
Pfizer exemplifies a(n) ________ mode of decision making.
A) centralized
B) decentralized
C) autocratic
D) unilateral
60) Japanese companies accomplish much of their decision making, communication, and control
through informal, face-to-face meetings between people who do not have formal reporting
relationships. This process is referred to as ________.
A) guanxi
B) tsubukan
C) inhwa
D) nemawasi
61) Which of the following structural combinations best depicts the U.S. military?
A) formal and decentralized
B) informal and decentralized
C) formal and centralized
D) informal and centralized
62) A bank organizes itself around the basic services it provides: personal banking, corporate and
business banking, and rural banking. Each service group has its own finance, marketing,
operations, and human resource management departments. The bank is using a ________.
A) functional structure
B) product structure
C) division structure
D) matrix structure
63) In a product structure, each product is treated as a ________; that is, the expenses related to a
product are subtracted from the revenues generated by selling it.
A) profit center
B) cost center
C) core competency
D) functional division
64) Which of the following is true about functional structures?
A) It is one of the most complex structures.
B) It increases the duplication of the firm’s functional resources.
C) It facilitates specialization of the firm’s functional knowledge.
D) It leads to a broad view of the organization’s overall goals.
65) Which of the following is a characteristic of a product structure?
A) It maximizes economies of scale for functional areas.
B) It increases coordination among different product groups.
C) It reduces organizational responsiveness to market changes.
D) The performance of the firm’s products is typically easier to evaluate.
66) In which of the following ways are product and customer structures similar?
A) They both increase companies’ ability to leverage global scale economies.
B) They both increase the international orientation of all managers.
C) They both boost responsiveness to changing market conditions.
D) They both result in ambiguous lines of authority.
67) Multinational firms usually use ________ structures when customer needs for a given
product are similar throughout the international markets in which the firm participates.
A) global product
B) functional
C) divisional
D) multiproduct
68) A ________ facilitates the use of modular products, each of which is different but which
contain some of the same parts. Thus, modular parts are produced and assembled in different
ways to produce several different products.
A) regional structure
B) customer structure
C) matrix structure
D) division structure
69) Which of the following is true about a divisional structure?
A) Organizing various product families within a division can increase functional duplication.
B) It reduces economies of scale for the firm’s functional activities.
C) Cross-regional coordination within product families and within the division is often easier.
D) It ensures that division objectives are well aligned with corporate objectives.
70) Which of the following is true regarding the customer structure?
A) It reduces the duplication of functional resources.
B) It decreases the firm’s responsiveness to actions taken by competitors.
C) It often makes it difficult to coordinate between customer units and corporate objectives.
D) It is suitable when customers’ needs and preferences are homogeneous.
71) Which of the following is a weakness of the regional structure?
A) It reduces the firm’s responsiveness to unique changes in the market.
B) It usually fosters a weak sense of accountability for performance among regional managers.
C) It reduces the duplication of functional resources across regions.
D) It often creates cross-regional coordination difficulties.
72) One of the major weaknesses of the ________ structure is that it often inhibits coordination
and communication among different regions.
A) customer
B) functional
C) geographic
D) product
73) An advantage of the regional structure is that ________.
A) it usually fosters a strong sense of accountability for performance among managers
B) it reduces the likelihood of conflict and coordination difficulties
C) it reduces the duplication of functional resources across regions
D) it fosters competitive behavior among regions
74) A ________ consists of two organizational structures superimposed on each other. As a
consequence, one person essentially reports to two bosses.
A) divisional structure
B) functional structure
C) matrix structure
D) regional structure
75) Companies that advocate unity of command would be least likely to adopt which
organizational structure?
A) customer
B) division
C) functional
D) matrix
76) A matrix structure ________.
A) is best suited to a changing and complicated business environment
B) simplifies the process of performance evaluation
C) increases organizational responsiveness to environmental changes
D) fosters a strong sense of accountability for performance among managers
77) A major disadvantage of a matrix structure is that ________.
A) it limits the flow of information throughout the organization
B) it reduces the quality of decision making
C) it does not make optimum use of a firm’s human resources
D) it often makes performance evaluations more complex
78) Which of the following statements characterizes a firm that operates within a “high-
networked” structure?
A) It uses outside organizations for only a limited number of minor value chain activities.
B) It has little contact with firms to which work has been outsourced.
C) It owns and executes most of its primary and support value chain activities.
D) It has more value chain activities networked to external organizations than it owns and
executes internally.
79) ________ is the practice of taking a significant activity within the organization and
contracting that activity out to an independent party.
A) Insourcing
B) Outsourcing
C) Homeshoring
D) Networking
80) SLPL Limited adheres to a strategy that allows managers to focus on core competencies or
the activities that are most likely to yield competitive advantage. In doing so, SLPL outsources
most of the activities in its value chain to other companies, retaining just a few elements. From
the above example, it can be concluded that SLPL has a ________ structure.
A) high-networked
B) divisional
C) matrix
D) global product
81) One of the greatest potential advantages of using a ________ is that it allows managers to
focus on core competencies.
A) product structure
B) network structure
C) regional structure
D) functional structure
82) Which of the following is a core category of environmental complexity?
A) quality
B) stability
C) technology
D) strategy
83) “White water” environments are ________.
A) stable
B) formal
C) dynamic
D) stationary
84) Computer software companies compete against a wide array of competitors and must
continually struggle to lead, or even stay abreast of, industry changes. Thus, we may say that
software companies exist in ________ and ________ external environments.
A) complex; static
B) complex; dynamic
C) simple; static
D) simple; dynamic
85) Indian Railways enjoys a monopoly in the country with regard to rail transportation as there
is no other player in this segment. Based on this, it can be concluded that Indian Railways enjoys
a fairly simpler ________ environment as compared to the numerous road transport service
providers in the country.
A) geographic
B) technology
C) competitor
D) supplier
86) Over the past 30 years, significant advancements have been made in technology, R&D, and
applications relating to the IT industry. This factor can be attributed to ________ contributing to
the overall uncertainty of the environment in the IT industry.
A) advanced formalization
B) the network structure
C) informalization
D) environmental dynamism
87) A firm with ________ would most likely use global product divisions to manage foreign
sales.
A) high foreign sales and high product diversification
B) high foreign sales and low product diversification
C) low foreign sales and high product diversification
D) low foreign sales and low product diversification
88) A mining company supplies materials such as sand, gravel, and lime to the local building
trade. It has few export sales. What is the most likely structure that this firm will use to manage
international sales?
A) a matrix structure
B) global product divisions
C) a geographic structure
D) an international division
89) Firms with ________ and ________ usually employ a geographic structure to manage
international sales.
A) low foreign sales; low product diversification
B) high foreign sales; low product diversification
C) low foreign sales; high product diversification
D) high foreign sales; high product diversification
90) The international division of a domestic organization ________.
A) typically has its own production facility
B) has its own marketing, finance, sales, and accounting departments
C) often customizes its products to suit local preferences
D) is not dependent on other divisions for products and support
91) When designing an organizational structure for an international environment, management
must choose between a ________, which integrates activities on a coordinated worldwide basis,
and a ________, which differentiates activities in each country served.
A) global approach; local approach
B) product approach; customer approach
C) functional approach; network approach
D) decentralized approach; centralized approach
92) ________ are individuals who are designated to act as a bridge between different areas, such
as quality or manufacturing processes.
A) Enablers
B) Liaisons
C) Gatekeepers
D) Fact-finders
93) Compare organizational structure and organizational design.
94) What is an organizational chart?
95) Describe the concept of “differentiation” in an organization.
96) Describe the types of interdependence that exist among organizational units.
97) Explain the concepts of unity of command and span of control.
98) What can be said about decision making in centralized organizations and decentralized
organizations? How do centralization and decentralization relate to formalization?
99) What is a product structure? What are its advantages and disadvantages?
100) What role does outsourcing play in a networked organization?
101) What factors, or core categories, impact environmental complexity?
102) Within the context of the increasingly international environment in which organizations
compete, contrast the global approach and the local approach to business.