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Flashcards in Chapter 14 Deck (53):
1

What accurately characterized the reality of the global matrix structure?

It can be difficult to get work done because of power struggles between divisions

2

This produces an inflexible organization that is unable to reach a decision quickly

Global matrix structure

3

This refers to the totality of a firm's organization, including formal organizational structure, control systems and incentives, organizational culture, processes and people

Organizational architecture

4

By organizational structure, we mean what 3 things

The formal division of the organization into subunits
The location of decision-making responsibilities within that structure
The establishment of integrating mechanisms to coordinate the activities of subunits

5

These are the metrics used to measure the performance of subunits and make judgments about how well managers are running those subunits

Control systems

6

These are the decided used to reward appropriate managerial behavior

Incentives

7

The manner in which decisions are made and work is performed within the organization

Processes

8

This refers to the norms and value systems that are shared among the employees of an organization

Organizational culture

9

This refers to not only the employees of the organization, but also the strategy used to recruit, compensate, and retain those individuals and the type of people that they are in terms of their skills, values, and orientation

People

10

Organizational structure can be thought of in terms of what three dimensions

Vertical differentiation
Horizontal differentiation
Integrating mechanisms

11

This refers to the location of decision-making responsibilities within a structure

Vertical differentiation

12

This refers to the formal division of the organization into subunits

Horizontal differentiation

13

These are mechanisms for coordinating subunits

Integrating mechanisms

14

This structure tends to be favored by firms with a low degree of diversification and a domestic structure based on functions. The world is divided into geography areas

Worldwide area structure

15

This tends to be adopted by firms that are reasonably diversified and, accordingly, ironically had domestic structures based on product divisions. Each division is a self contained, largely autonomous entity with full responsibility for its own value creation activities.

Worldwide product division structure

16

What are the three components of a firm's organizational structure?

The formal division of the organization into subunits
Location of decision-making responsibilities within the organization,
The establishment of integrating mechanisms to coordinate the activity in the subunits

17

These are societies of individuals who perform collective tasks with their own distinctive cultures and subcultures

Organizations

18

What are the three dimensions of organizational structure?

Vertical differentiation
Horizontal differentiation
Integrating mechanisms

19

Level of performance ambiguity associated with transnational firms

High

20

Level of performance ambiguity associated with global standardization firms

Medium

21

Level of performance ambiguity associated with localization firms

Low

22

The importance of local responsiveness in pursuing a localization strategy leads firms to adopt a ____ decision making model

Decentralized

23

This allows for horizontal differentiation in product division and geographic areas

The global matrix structure

24

Which control system is achieved by personal contact with subordinates

Personal

25

The ______ strategy used both centralized control go realize location and experience effects that reduce costs, and decentralized decision making to meet the needs of local responsiveness

Transnational

26

When performance ambiguity is high, the cost of control will be

High

27

Three ways firms can divide themselves into subunits using horizontal differentiation

By type of business, by geographic area, by function

28

Two benefits of the worldwide product division structure

Enhances the consolidation of value creation activities at key locations
Facilitates the transfer of core competencies within a division's worldwide operations

29

What conditions must be fulfilled to achieve superior enterprise profitability? (2)

Different elements of the firm's organizational architecture must be internally consistent
Organizational architecture, the firm's strategy, and the competitive environment must be consistent

30

Four main types of control systems

Personal controls
Bureaucratic controls
Output controls
Cultural controls

31

This control is achieved by personal contact with subordinates

Personal control

32

This type of control tends to be most widely used in small firms, and also structured the relationships between managers at different levels in multinational enterprises

Personal controls

33

This control is achieved through a system of rules and procedures that directs the actions of subunits

Bureaucratic control

34

This control involves setting goals for subunits to achieve and expressing those goals in terms of relatively objective performance metrics such as profitability, productivity, growth, market share, and quality

Output control

35

This control exists when employees "buy into" the norms and value systems of the firm. Employees tend to control their own behavior, which reduces the need for direct supervision

Cultural control

36

The control system where goals are set for subunits to achieve and performance metrics are used to judge attainment of those goals is called

Output controls

37

The basic principle of an incentive scheme for an individual employee is to link the incentive to

An output target

38

The basic principle of this for an individual employee is to link the incentive to an output target

An incentive scheme

39

This gives subunits an amount it can spend in a given year

A budget

40

This gives headquarters control over how the money is spent by subunits

Capital spending rules

41

Which strategy would reflect the lowest level of performance ambiguity

Localization

42

The control system where employees tend to control their own behavior and need little direct supervision, because they have elected to follow the forms and values of the firm is

Cultural controls

43

Facilitating coordination, making it easier for top-level managers to bring about change, eliminating duplication of activities and making decisions consistent with organizational objectives are arguments for ______ of decision making

Centralization

44

The ___ strategy may use a mix of centralization and decentralization depending on the pressures for local responsiveness and the need to coordinate a dispersed value chain and transfer core competencies. There is a high need for coordination when using this strategy

The transnational strategy

45

What is the method of control where actions of subunits are directed by a system of rules and procedures?

Bureaucratic

46

The _____ strategy is the strategy in which businesses centralize functions such as R&D and marketing functions, but decentralize operating decisions to subsidiaries

The international strategy

47

A _____ strategy has firms operating with worldwide area structures, where operating decisions are decentralized to functionally self-contained country subsidiaries

Localization

48

Integrating mechanisms are used by a firm to help ____

Achieve coordination between subunits

49

These are used by a firm to help achieve coordination between subunits

Integrating mechanisms

50

The first principle of successful organizational change is to unfreeze the organization though

Shock therapy

51

The norms and value systems of a company make up the company's ____ and are a source of organizational inertia

Culture

52

This exists when the causes of a subunit's poor performance are not clear

Performance ambiguity

53

Two measures a company might use when refreezing an organization

Change hiring policies
Educate staff