Chapter 14: The Organization of International Business Flashcards
Boundaries
In terms of political environments, an official or perceived point of separation that defines the boundary of a nation. In terms of organization structure, horizontal constraints that follow from having specific employees only do specific jobs in specific units as well as the vertical constraints that separate employees into specific levels of a precisely stipulated command-and-control hierarchy.
Boundarylessness
State whereby companies build organizations that eliminate the vertical, horizontal, and external boundaries that impede information flows and hinder relationship development
bureaucratic control
when an organization uses centralized authority to install rules and procedures to govern activities.
centralization
The degree to which high-level managers, usually above the country level, make strategic decisions and delegate them to lower levels for implementation.
control systems
Process by which managers compare performance to plans, identify differences, assess the basis for a gap and implement corrective action; ensure that activities are completed in ways that support the company’s strategy.
coordination by mutual adjustment
System whereby managers interact extensively with counterparts to set common goals.
coordination by plan
System that sets general goals and detailed objectives to coordinate activities.
coordination by standardization
System where universal rules and procedures apply to units worldwide, which enforces consistency in operations in geographically dispersed units.
Coordination systems
systems that synchronize the work responsibilities of the value chain so that the company uses its resources efficiently and makes decisions effectively
decentralization
The degree to which lower-level managers, at or below the country level, make and implement strategic decisions.
divisional structure
Divisions separated based on individual product lines or based on the geographic areas of the markets served.
functional structure
An organization that is structured according to functional areas of business.
globality
When one competes with everyone, from everywhere, for everything.
market controls
System where an MNE uses external market mechanisms to establish internal performance standards.
matrix structure
An structure in which foreign units report (by product, function, or area) to more than one group, each of which shares responsibility over the foreign unit.
