1
Regional management centers are a form of a(n)
(A)
country-based organization
(B)
geographic organization
(C)
international division
(D)
functional organization
2
When Taiwan Graphics first entered Indonesia, all decisions for the new market were made
in Taiwan. Now all decisions for Indonesia are made by the subsidiary there. Taiwan
Graphics has changed orientations from
(A)
(B)
(C)
(D)
3
For many years Swiss Pharmaceuticals centralized decision-making in Zurich, and Swiss
managers made virtually all major decisions for the company’s 64 foreign subsidiaries.
Decision-making is still centralized, but subsidiaries are closely involved in global product
development and global theme advertising campaigns. The firm’s orientation has changed
from
(A)
geocentric to global.
(B)
polycentric to ethnocentric.
(C)
ethnocentric to geocentric.
(D)
No change has occurred.
4
French Bakery Breads believes that every national market is unique in terms of competition
and consumer behavior and a local national is the best choice to run a subsidiary and make
its key marketing decisions. French Bakery Breads most likely adheres to which
orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
Global
5
U.S.-based Tin City Bicycles is about to undertake a global roll-out of a new bicycle
developed in their Indian subsidiary. Tin city most likely adheres to which orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
Market
6
Taberet believes that the world can be divided into 5 regional markets: North America,
South America, Europe, Asia, and the Middle East/Africa. Each region is given a great deal
of autonomy within Taberet. Taberet.most likely adheres to which orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
None of the above
7
MabHill’s manager in Malaysia successfully launched a new product that was developed in
the Malaysian plant. However, he cannot generate any interest in the product back at
global headquarters. Headquarters just isn’t interested in an utilizing an idea from Malaysia
in any of its other subsidiaries. Most likely the firm adheres to which orientation?
(A)
Product
(B)
Production
(C)
Geocentric
(D)
Polycentric
8
Sam Nitan’s family business exports five percent of its total sales. The business has no
other operations abroad. Which organization should the company adopt?
(A)
Export department
(B)
Export functional organization
(C)
International department
(D)
Global product organization
9
Carol Miller’s family business exports five percent of its total sales. The business has no
other operations abroad. Which organization should the company adopt?
(A)
Functional organization
(B)
International department
(C)
Global product organization
(D)
Export department
10
Texas Taffy is developing a new Southwest-flavor line of candy for simultaneous launch in
Mexico and the United States. Managers from both its U.S. headquarters and its Mexican
subsidiary are involved in product development for this line. Texas Taffy most likely
adheres to which orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
Product
11
Karavel Foods expects its foreign subsidiaries to show profits and growth every year. As
long as they do this, headquarters lets subsidiaries do what they want. Karavel most likely
adheres to which orientation?
(A)
Ethnocentric
(B)
Global
(C)
Polycentric
(D)
Portfolio
12
Tunetoy Industries exports products overseas and has no manufacturing abroad. U.S.–
based managers are sent to oversee foreign marketing subsidiaries. Tunetoy most likely
adheres to which orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
Global
13
To avoid duplication of efforts across countries, a global firm should adopt a __________
structure.
(A)
regional
(B)
country-based
(C)
functional
(D)
Any of the above.
14
A product organizational structure is best suited for companies
(A)
that have several unrelated product lines
(B)
with homogeneous product lines
(C)
targeting similar markets
(D)
that have production in only one country
15
Which of the following is a two-dimensional organizational structure?
(A)
Functional
(B)
Product-based
(C)
Region-based
(D)
Matrix
16
An expressed assignment to carry out a task on a global scale is referred to as a(n)
__________ mandate.
(A)
matrix
(B)
ethnocentric
(C)
polycentric
(D)
global
17
The main advantage for a born-global firm over a traditional firm is
(A)
it has extensive market knowledge
(B)
it can adopt a global organizational structure early
(C)
its well-trained and experienced managers
(D)
None of the above
18
An organizational advantage of a born-global firm over a traditional multinational firm is it
(A)
can operate like an export department
(B)
has more experience in overseas markets
(C)
can adopt a global organizational structure from the start and avoid disruptions of
reorganizations
(D)
is assured of a polycentric orientation from its inception
19
Foreign managers are most likely to reach CEO status in MNCs whose home country is
(A)
a developing country
(B)
France
(C)
Japan
(D)
the USA
20
Canon Car Mirrors has 14 overseas subsidiaries each of which has its own plant and largely
determines is own product lines and marketing programs. Canon most likely adheres to
which orientation?
(A)
Ethnocentric
(B)
Polycentric
(C)
Geocentric
(D)
Global
21
Ben Smith’s U.S.-based family business exports five percent of its total sales to either
Canada or Mexico. The business has no other operations abroad. Which organization should
the company adopt?
(A)
Country-based organization
(B)
Export department
(C)
Global product organization
(D)
Regional organization
22
Alice Adams’ U.K.-based family business exports five percent of its total sales to other
countries within the EU. The business has no other operations abroad. The business has no
other operations abroad. Which organization should the company adopt?
(A)
Regional organization
(B)
Country-based organization
(C)
Global product organization
(D)
Export department
23
Tunetoy Industries participates in four distinct industries, each with its own customers and
competitors. Manufacturing economies of scale are high in all these industries and trade
barriers are minimal. As a result, Tunetoy needs only one or two plants in each industry to
serve the global market. International sales account for 60 percent of total firm sales. The
business has no other operations abroad. Which organization should the company adopt?
(A)
Export department
(B)
International division
(C)
Global product organization
(D)
Global production organization
24
Parish Products primarily controls its foreign subsidiaries by setting behavioral standards.
These could include
(A)
sales and profits
(B)
prices charged for products
(C)
market share
(D)
customer satisfaction
25
French Bakery Breads primarily controls its foreign subsidiaries by setting behavioral
standards. These could include
(A)
sales and profits
(B)
customer satisfaction
(C)
market share
(D)
None of the above
26
LeBlanc Industries wants to establish greater cultural control across its various national
subsidiaries. It should
(A)
establish an international division
(B)
bring new hires to headquarters for training
(C)
establish global teams to investigate global products
(D)
adopt a polycentric organization
27
A global product manager of a major U.S.-based MNC is upset over two incidents that have
occurred in the firm’s Mexican subsidiary. The country manager has argued against a price
increase proposed by headquarters and has insisted that the local sales force be expanded.
What advice would you give the global product manager?
(A)
Don’t listen to the country manager. You have authority over these issues
(B)
Listen to the country manager. You don’t have authority over these issues
(C)
Don’t be upset. Conflict can be good
(D)
These issues should be taken to the CEO immediately
28
^___^ orientation means management is centered on the home market and ideas that
emanate from there are considered superior to those that arise from the foreign
subsidiaries.
29
Organizing a company with a homogeneous product line into marketing, sales,
manufacturing, and R&D units is an example of the ^___^ organizational structure.
30
A(n) ^___^ global organizational structure is appropriate for companies with several
unrelated product lines.
31
A(n) ^___^ is an expressed assignment to carry out a task on a global scale.
32
Canon Car Mirrors primarily controls its foreign subsidiaries by setting performance
standards. These could include
(A)
sales and profits
(B)
share of market
(C)
customer satisfaction
(D)
All of the above
33
Karavel Foods establishes both behavioral and performance standards at headquarters and
then asks national subsidiaries to implement what headquarters has decided upon. What is
wrong with this?
(A)
Subsidiaries should set performance standards
(B)
Subsidiaries should set behavioral standards
(C)
Subsidiaries should have input into both behavioral and performance standards
(D)
Subsidiaries should have input into behavioral standards
34
Taberet is considering moving from a regional organization to a product-regional matrix
structure. What can the company hope to accomplish from this?
(A)
Lower costs
(B)
Better global roll-outs
(C)
Clearer authority structure
(D)
Product managers will dominate country managers
35
Argentin-tech operates in a single industry where customer needs are similar worldwide
and over 50 percent of sales are made to MNCs. All production is centralized in Buenos
Aires and overseas sales account for 70 percent of total sales. Which organization should
the company adopt?
(A)
Export department
(B)
Global functional organization
(C)
Global production organization
(D)
Regional organization
36
MabHill realizes 50 percent of its sales in the EU where it also has one production facility.
The other 50 percent of sales come from NAFTA countries where it also has one production
facility. Which organization should the company adopt?
(A)
Production-based
(B)
Global product
(C)
Regional
(D)
Functional
37
Action Toys recently centralized production, advertising and product development in
Europe although local country managers still have authority over their sales forces and
after-sales service. Organizationally, the firm is moving in which direction?
(A)
From geographic to global production
(B)
From geographic to global product
(C)
From country-based to regional
(D)
From regional to global functional
38
ABC Autos has recently changed from a functional organization to a regional one. What
benefits should ABC realize from this change?
(A)
Decreased marketing costs
(B)
Decreased production costs
(C)
Both a and b
(D)
Closer contact with distributors and customers
39
ABC Autos has recently switched from a regional structure to a functional one. What
problems might it face?
(A)
Increased marketing costs
(B)
Increased production cost
(C)
Increased R&D costs
(D)
None of the above
40
ABC Autos cannot decide between a global functional organization and a geographic-based
organization. What should it do?
(A)
Functional organizations are best for autos
(B)
Regional organizations are best for autos
(C)
Global product organizations are best for autos
(D)
Consider a matrix organization
41
ABC Autos cannot decide between a global functional organization and a geographic-based
organization. ABC Autos is considering a matrix structure. What is your advice?
(A)
Matrix organizations are inappropriate for autos
(B)
Matrix organizations are only for balancing product and regional needs
(C)
A matrix organization will help clarify authority and responsibility
(D)
None of the above
42
Indopharm is considering a matrix organization. It believes that national markets vary
greatly in how pharmaceuticals must be marketed. However, high R&D costs require the
development of global products and the use of global roll-outs. What would you suggest?
(A)
An export-function matrix
(B)
A functional-product matrix
(C)
A geographic-product matrix
(D)
An international division
43
A task force called a(n) ^___^ may be assigned a global mandate.
44
Which is not associated with a global organization?
(A)
International division
(B)
Regional management centers
(C)
Product organizational structures
(D)
Functional organizational structures
45
The structure of an international organization should be congruent with the tasks to be
performed, the need for product knowledge, and the need for market knowledge.
(A)
True
(B)
False
46
Time zones can be an external force that determine how global organizations are managed.
(A)
True
(B)
False
47
As sales to foreign markets become more important, a company often replaces its export
department with an international specialist.
(A)
True
(B)
False
48
As sales to foreign markets become more important, a company often replaces its export
department with an international division.
(A)
True
(B)
False
49
When the volume of international sales increases, companies move from having an
international division to an export department.
(A)
True
(B)
False
50
International divisions are proactive compared to export departments and actively seek out
market opportunities in foreign countries.
(A)
True
(B)
False
51
A firm with a few key global customers may adjust its organizational structure by locating
offices next to its customers.
(A)
True
(B)
False
52
When companies begin selling products to foreign markets, they need to have well funded
international divisions.
(A)
True
(B)
False
53
The United States, Britain, and Australia can be grouped together in a regional
organizational structure because English is the first language in all of these countries.
(A)
True
(B)
False
54
Since the Internet, global managers no longer need to travel overseas to engage in face-to–
face conversations.
(A)
True
(B)
False
55
Firms with key global customers should centralize their office locations in the triad
markets.
(A)
True
(B)
False
56
The volume of international sales does not affect the organizational structure of a firm.
(A)
True
(B)
False
57
The proper organizational structure for a firm never changes, and it is determined by the
industry.
(A)
True
(B)
False
58
Strategy statements should not be part of a company’s mission statement.
(A)
True
(B)
False
59
In a polycentric orientation, management is centered on the home market and ideas that
emanate from there are considered superior.
(A)
True
(B)
False
60
Some polycentric firms have a national focus, and some have a regional focus.
(A)
True
(B)
False
61
A geocentric orientation returns power to global headquarters and centers on global
markets as a whole.
(A)
True
(B)
False
62
Geocentric and ethnocentric organizations have nothing in common.
(A)
True
(B)
False
63
An export department is appropriate once export sales exceed 25 percent of a firm’s total
sales.
(A)
True
(B)
False
64
An export department is appropriate when international sales account for 1 to 10 percent
of a firm’s total sales.
(A)
True
(B)
False
65
Using a regional organization is the best way to eliminate duplication of functions in a
global firm.
(A)
True
(B)
False
66
Country-based organizations are similar to region-based organizations except that the
focus is on single countries rather than on a group of countries.
(A)
True
(B)
False
67
Organizing a company into marketing, production, accounting, and research and
development units is known as a product-based organizational structure.
(A)
True
(B)
False
68
In a firm with an ethnocentric orientation,
(A)
ideas from the home market are considered superior to those of subsidiaries.
(B)
each market is considered unique.
(C)
the firm centers on the global market as a whole.
(D)
All of the above.
69
If headquarters tells its foreign subsidiaries what to do and solicits little input, it is said to
be
(A)
ethnocentric.
(B)
multinational.
(C)
polycentric.
(D)
geocentric.
70
When a firm considers each national market to be unique, it is said to be
(A)
ethnocentric.
(B)
multinational.
(C)
polycentric.
(D)
geocentric.
71
__________ firms give local subsidiaries great leeway to develop and to implement their
own strategies.
(A)
Ethnocentric
(B)
French
(C)
Polycentric
(D)
Global
72
What do geocentric and ethnocentric firms have in common?
(A)
Both are xenophobic.
(B)
Decision making is centralized.
(C)
Input from subsidiaries is not appreciated.
(D)
Decision making is at the regional rather than at the national level.
73
Which of the following is an internal force that affects an international organization?
(A)
Geographical distance between headquarters and its subsidiaries
(B)
The percentage of the firm’s sales that are international
(C)
Customer profiles
(D)
Government regulations
74
As management in domestic firms recognizes the potential in international markets,
__________ are often added to the domestic organization.
(A)
global mandates
(B)
geocentric specialists
(C)
polycentric specialists
(D)
international specialists
75
Firms prefer international divisions over export departments when
(A)
their export volumes are small
(B)
the volume of exports increases
(C)
exchange rates fluctuate rapidly
(D)
political risk is high
76
When management of a multinational firm remains centered on its home market, it is said
to be
(A)
domesticated.
(B)
ethnocentric.
(C)
multinational.
(D)
geocentric.
77
Corporate culture may be used as part of a control strategy.
(A)
True
(B)
False
78
Corporate culture should never be used as part of a control strategy.
(A)
True
(B)
False
79
Product-based organizational structures are best suited for companies with several
unrelated product lines.
(A)
True
(B)
False
80
With product-based organizational structures, companies can be most sensitive to local
market conditions.
(A)
True
(B)
False
81
In a matrix organizational structure, there is dual or multiple lines of command, with
individuals reporting to more than one superior.
(A)
True
(B)
False
82
Power struggles are a common problem when matrix structures are introduced within a
global firm.
(A)
True
(B)
False
83
Matrix organizations are simple and less expensive for the company to maintain.
(A)
True
(B)
False
84
Management often adds global mandates to its domestic organization as inquiries increase
from abroad.
(A)
True
(B)
False
85
Global mandates may be temporary in nature.
(A)
True
(B)
False
86
Conflict between headquarters and subsidiaries is always bad.
(A)
True
(B)
False
87
Who might report to the head of an international division?
(A)
Sales managers
(B)
Marketing managers
(C)
Production managers
(D)
All of the above