53) Formal reports, management performance evaluations, and financial metrics are three examples of
________.
A) coordinating tools
B) coordinating systems
C) control systems
D) control mechanisms
54) MNEs typically use reporting systems for foreign operations that are similar to the ones they use
domestically ________.
A) primarily in the early stages of operating abroad
B) because common systems allow comparative evaluations
C) until the subsidiary demonstrates mastery of the form
D) only in those countries with extremely similar systems of information technology
55) Market-share increase and turnover ratios are examples of ________.
A) nonfinancial evaluation metrics
B) financial evaluation metrics
C) cost and accounting metrics
D) enterprise resource planning (ERP)
56) Which tool is used by most firms to monitor the data linkages among product planning, parts
purchasing, and inventory maintenance activities?
A) reports
B) clan controls
C) financial metrics
D) information systems
57) ________ is a system of shared values about what is important and beliefs about how the world
works among the employees of an organization.
A) Organizational system
B) Organizational structure
C) Organizational culture
D) Organizational vision
58) Which of the following is most likely a true statement about organization culture?
A) Many organizations use a robust organization culture to create consistently high performance.
B) Fewer and fewer companies allow an organization’s culture to emerge naturally.
C) Typically, managers from different countries have values similar to those endorsed by the company.
D) Divergent values among managers and employees ease the exchange of ideas between people from
different countries.
59) A company adopting a(n) ________ strategy will likely aim to develop an organization culture that
helps employees around the world unconditionally accept common goals and practices.
A) domestic
B) multidomestic
C) national
D) global
60) Which of the following is NOT one of the main priorities for most corporate universities?
A) complying with labor regulations in local markets
B) facilitating strategic understanding among executives
C) strengthening employee commitment to organization goals
D) improving the influence of the organization’s culture
61) Current approaches to designing an organization see the task of building knowledge-generating and
decision-making relationships as less important than specifying the best structural arrangement.
62) New configurations of value activities create coordination and control challenges that cannot be
addressed by the functionality outlined in a formal structure.
63) A firm’s vertical differentiation determines where in its organization structure managers have
decided to concentrate decision-making authority.
64) Decentralization has the key advantage of letting decisions be made by those who directly deal with
customers, competitors, and markets.
65) One advantage of centralized corporate practices is a reduced risk that lower-level employees make
costly, wrong decisions.
66) Horizontal differentiation is concerned with how the managers of a firm decide to divide the
company into discrete subunits.
67) Technology such as e-mail, VoIP, teleconferencing, and social networks help MNEs respond to
increasing globality.
68) The functional structure is inappropriate for firms with products and manufacturing methods that are
largely undifferentiated among countries.
69) The functional structure is ideal when the company faces complex and changing environments.
70) A divisional structure tends to be adopted by firms that are diversified by products or markets.
71) Companies tend to use geographic divisions when they have large foreign operations that are not
dominated by a single country or market.
72) Andrews Enterprises, which uses an international division structure, should be able to respond
quickly to foreign activities but will most likely experience costly country-to-country duplication.
73) In a matrix structure, product, functional, or geographic groups compete for resources.
74) A matrix organization is a hybrid of the functional and geographic organizations.
75) Neoclassical structures aim to centralize decision-making authority by removing boundaries that
impede the decentralization of decision making.
76) A common feature of neoclassical structures is greater cross-functional collaboration.
77) The notion of boundaries, within the context of neoclassical structures, refers to those limitations
that interfere with communication and collaboration between the firm and its suppliers, distributors,
allies, competitive rivals, and customers.
78) The keiretsu structure long used by Japanese companies is an example of virtual organization.
79) Coordination methods include mutual adjustment, planning, and standardization.
80) Coordination by plan deals with exact rules and procedures that spell out what needs to be done and
how.
81) MNEs typically design their control systems in terms of either market control, bureaucratic control,
or adaptation control.
82) Adopting a market control system requires that the MNE uses external market mechanisms to
establish internal performance benchmarks and standards.
83) MNEs use different report formats and schedules for foreign operations according to local customs.
84) The benefits of managerial visits to foreign subsidiaries can easily be replicated with frequently
submitted and reviewed operational reports and schedules.
85) The common values shared by a company’s employees are known as its organization culture.
86) The character of a company’s corporate culture is a product of the core values and business
principles that management advocates, as well as the behaviors that define “how we do things around
here.”
87) According to the unity-of-command principle, workers and organizations benefit the most from dual
hierarchies of communication.
88) Neoclassical structures promote tightly connected networks both vertically and horizontally to
ensure that strategic requirements are fulfilled.
89) The primary benefit of neoclassical structures is the ability of MNEs to coordinate responses and
maintain effective control of various units.
90) The open source model is a hyperarchy that involves giving source code to volunteers who fix
software bugs.
91) How might centralization of decision making adversely affect local managers in an MNE?
92) Profile the idea and features of horizontal differentiation, paying particular attention to its
implications to how managers design their company’s structure.
93) Explain the major types of classical organization structures and the advantages and disadvantages of
each for international operations.
94) Profile the causes and likely benefits that prompt companies to consider adopting a neoclassical
structure.
95) Describe how an MNE might use reports as a control mechanism.
96) In a brief essay, discuss how decentralized management and organizational culture affect Johnson &
Johnson.
97) What is the difference between a classical structure and a neoclassical structure? Provide examples
of each type.
98) What role does a firm’s strategy play in determining organizational structure? Why are boundaries
problematic for firms with international strategies?
99) Why is it essential for MNEs to consider coordination systems when implementing an organizational
structure? Briefly describe each approach to coordination.
100) Why do you think corporate universities are becoming more popular among MNEs? How do both
MNEs and employees benefit from corporate universities?