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International Management: Culture, Strategy, Behavior - Chapter 9

Key Concepts:

Terms in this set (50)

The primary reason for the use of _____ is a desire by the MNC for total control and the belief that managerial efficiency will be better without outside partners.


A. Licensing agreements

B. Franchising

C. Wholly owned subsidiaries

D. Joint ventures
C. Wholly owned subsidiaries
This is an agreement in which two or more partners own and control an overseas business.


A. Franchise

B. Wholly owned subsidiary

C. Licensing agreement

D. Joint venture
D. Joint venture
The equity joint venture:


A. Is characterized by one group merely providing a service for another

B. Involves a financial investment by the MNC in a business enterprise with a local partner

C. Organizes worldwide operations based primarily on function and secondarily on product

D. Provides the most benefits when the need for product specification or differentiation is high
B. Involves a financial investment by the MNC in a business enterprise with a local partner
The nonequity venture:


A. Is characterized by one group merely providing a service for another

B. Provides the most benefits when the need for product specification or differentiation is high

C. Involves a financial investment by the MNC in a business enterprise with a local partner

D. Organizes worldwide operations based primarily on function and secondarily on product
A. Is characterized by one group merely providing a service for another
The two types of joint ventures are:


A. Equity and non-equity ventures

B. Proprietary and public ventures

C. Statutory and unofficial ventures

D. External and internal ventures
A. Equity and non-equity ventures
This is an agreement that allows one party to use an industrial property right in exchange for payment to the other party.


A. Franchise

B. Joint venture

C. License

D. Certificate of proprietary usage
C. License
A _____ is a business arrangement under which one party allows another to operate an enterprise using its trademark, logo, product line and methods of operation in return for a fee.


A. License

B. Franchise

C. Certificate of proprietary usage

D. Joint venture
B. Franchise
These agreements typically require payment of a fee upfront and then a percentage of the revenues.


A. Franchise

B. Wholly owned subsidiary

C. Export

D. Joint venture
A. Franchise
Aircraft manufacturing fits which of the following globalization versus local responsiveness combination?


A. High pressure for globalization, high pressure for local responsiveness

B. High pressure for globalization, low pressure for local responsiveness

C. Low pressure for globalization, low pressure for local responsiveness

D. Low pressure for globalization, high pressure for local responsiveness
B. High pressure for globalization, low pressure for local responsiveness
Clothing manufacturing fits which of the following globalization versus local responsiveness combination?


A. Low pressure for globalization, low pressure for local responsiveness

B. Low pressure for globalization, high pressure for local responsiveness

C. High pressure for globalization, low pressure for local responsiveness

D. High pressure for globalization, high pressure for local responsiveness
B. Low pressure for globalization, high pressure for local responsiveness
A common first choice among manufacturing firms, especially those with technologically advanced products, would be to develop a(n):


A. Domestic policy

B. Export arrangement

C. Cartel arrangement

D. Import quota
B. Export arrangement
In a company that has a narrow product line, the export manager usually reports directly to the head of:


A. Purchasing

B. Personnel

C. Production

D. Marketing
D. Marketing
The structural arrangement that allows a company to develop an overall, unified approach to international operations and helps the firm develop a cadre of internationally experienced managers is an advantage of a(n):


A. Mixed organization structure

B. Global area division structure

C. Global product division structure

D. International division structure
D. International division structure
Pressure by local foreign government for continued growth of international sales encourage on-site:


A. Maintenance

B. Supply and distribution operations

C. Manufacturing operations

D. Safety operations
C. Manufacturing operations
A structural arrangement that handles all international operations out of a division created for this purpose is referred to as a(n):


A. Worldwide organizational structure

B. Global matrix structure

C. International division structure

D. Overseas network structure
C. International division structure
Companies still in the development stages of international business involvement are most likely to adopt the:


A. International division structure

B. Global product division structure

C. Global area division structure

D. Global functional division structure
A. International division structure
According to the text, all of the following types of companies are likely to adopt the international division structure except:


A. Companies with limited geographic diversity

B. Companies with a large number of executives with international expertise

C. Companies still in the developmental stage of international business

D. Companies with small international sales
B. Companies with a large number of executives with international expertise
A structural arrangement in which domestic divisions are given worldwide responsibility for product groups is referred to as a(n):


A. International division structure

B. Global product division structure

C. Global area division structure

D. Global functional division structure
B. Global product division structure
The products sold by firms that adopt a global product division structure are generally in the _____ stage of the product life cycle.


A. Introduction

B. Growth

C. Maturity

D. Decline
B. Growth
Which of the following provides the most benefits when the need for product specification or differentiation is high?


A. International division

B. Global product division

C. Global area division

D. Global functional division
B. Global product division
A structure under which global operations are organized on a geographic rather than a product basis is referred to as a(n):


A. Global area division structure

B. Global product division structure

C. International division structure

D. Global functional division structure
A. Global area division structure
That division managers may pursue currently attractive geographic prospects for their products and neglect other areas with better long-term potential is a major drawback of the:


A. International division structure

B. Global product division structure

C. Global area division structure

D. Global functional division structure
B. Global product division structure
Which of the following is an advantage of a global area division structure?


A. The structural arrangement helps a firm manage a diverse product line

B. The structural arrangement helps a firm cater to local needs in foreign markets

C. The marketing, production and finance divisions of the firm can be coordinated on a product-by-product global basis

D. The structural arrangement helps a firm develop an overall, unified approach to international markets
B. The structural arrangement helps a firm cater to local needs in foreign markets
A global area division structure most often is used by companies that are in _____ businesses and have _____ product lines.


A. Growing; broad

B. Mature; narrow

C. Growing; narrow

D. Mature; broad
B. Mature; narrow
The difficulty encountered in reconciling a product emphasis with a geographic orientation is the primary disadvantage of a(n):


A. International division structure

B. Global product division structure

C. Global area division structure

D. Global functional division structure
C. Global area division structure
Which of the following organizes worldwide operations based primarily on function and secondarily on product?


A. International division structure

B. Global product division structure

C. Global area division structure

D. Global functional division structure
D. Global functional division structure
A global functional division structure is used primarily by:


A. Service companies

B. Extractive companies

C. Light manufacturing companies

D. Heavy manufacturing companies
B. Extractive companies
All of the following are advantages of the global functional division structure except:


A. An emphasis on functional expertise

B. A tight centralized control

C. A relatively lean managerial staff

D. The chief executive officer is held accountable for the profits
D. The chief executive officer is held accountable for the profits
A structure that is a combination of a global product, an area or a functional arrangement is referred to as a(n) _____ organizational structure.


A. Assimilated

B. Transnational

C. Mixed

D. Team-based
C. Mixed
A multinational structural arrangement that combines elements of function, product and geographic designs, while relying on a network arrangement to link worldwide subsidiaries is referred to as a:


A. Transnational network structure

B. Cross-cultural matrix structure

C. Transnational divisional structure

D. Cross-cultural network structure
A. Transnational network structure
A _____ is designed to help MNCs take advantage of global economies of scale while also being responsive to local customer demands.


A. Global matrix structure

B. Transnational network structure

C. Worldwide divisional structure

D. Cross-cultural matrix structure
B. Transnational network structure
At the center of the _____ are nodes, which are units charged with coordinating product, functional and geographic information.


A. Cross-cultural matrix structure

B. Worldwide divisional structure

C. Transnational network structure

D. Global product division structure
C. Transnational network structure
Subsidiaries that are located anywhere in the world where they can benefit the organization are called:


A. Chaebols

B. Keiretsus

C. Specialized subunits

D. Dispersed subunits
D. Dispersed subunits
Specialized operations are:


A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries

B. Subsidiaries that are located anywhere in the world where they can benefit the organization

C. Designed to take advantage of low factor costs, while others are responsible for providing information on new technologies or consumer trends

D. Used to share information and resources throughout dispersed and specialized subunits
A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries
Interdependent relationships are:


A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries

B. Subsidiaries that are located anywhere in the world where they can benefit the organization

C. Used to share information and resources throughout the dispersed and specialized subunits

D. Designed to take advantage of low factor costs, while others are responsible for providing information on new technologies or consumer trends
C. Used to share information and resources throughout the dispersed and specialized subunits
In terms of cultural control in a global area division:


A. It is treated like all other MNC structural divisions

B. Local subsidiary culture is often the most important

C. It is possible for some companies, but not always necessary

D. Culture must support the shared decision making
B. Local subsidiary culture is often the most important
In which of the following MNC structures are tight process bureaucratic controls used to maintain product quality and consistency?


A. Transnational network structure

B. Global area division

C. Matrix structure

D. Global product division
D. Global product division
The decision-making control in which local units are given autonomy is characteristic of a(n):


A. Global area division structure

B. International division structure

C. Global product division structure

D. Transnational network structure
A. Global area division structure
The output control in which profit responsibility is shared with product and geographic units is characteristic of a(n):


A. Global area division structure

B. International division structure

C. Matrix structure

D. Transnational network structure
C. Matrix structure
Bureaucratic control is not very important in which type of multinational structure?


A. Global product division structure

B. Global area division structure

C. Matrix structure

D. International division structure
C. Matrix structure
Which basic value is not common in Asian firms?


A. Group

B. Trust

C. Confrontation

D. Fluid
C. Confrontation
Individuals who work for a company, usually via the Internet and move on to other employment when their assignment is done are known as:


A. Purchasing agents

B. Marketing managers

C. International outsourcers

D. Electronic freelancers
D. Electronic freelancers
_____ is the use of defined structures and systems in decision-making, communicating and controlling.


A. Formalization

B. Specialization

C. Concentration

D. Interpretation
A. Formalization
In a study of U.S. and Japanese firms in Taiwan, objective formalization was measured by:


A. Use of informal controls

B. The extent to which goals were vague and unspecified

C. The number of different documents given to employees

D. Use of culturally induced values in getting things done
C. The number of different documents given to employees
As an organizational characteristic, _____ is the assigning of individuals to specific, well-defined tasks.


A. Interpretation

B. Concentration

C. Formalization

D. Specialization
D. Specialization
Specialization in an international context can be classified into:


A. Diagonal and vertical specialization

B. Vertical and parallel specialization

C. Horizontal and vertical specialization

D. Diagonal and parallel specialization
C. Horizontal and vertical specialization
The assignment of jobs so that individuals are given a particular function to perform and tend to stay within the confines of this area is referred to as:


A. Diagonal specialization

B. Parallel specialization

C. Vertical specialization

D. Horizontal specialization
D. Horizontal specialization
The assignment of work to groups of departments where individuals are collectively responsible for performance is referred to as:


A. Horizontal specialization

B. Vertical specialization

C. Lateral specialization

D. Parallel specialization
B. Vertical specialization
_____ is a management system in which important decisions are made at the top.


A. Centralization

B. Decentralization

C. Horizontal specialization

D. Vertical specialization
A. Centralization
Pushing decision making down the line and getting the lower-level personnel involved is referred to as:


A. Centralization

B. Decentralization

C. Horizontal specialization

D. Vertical specialization
B. Decentralization
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