Q&A Hero

Q: Which of the following best describes globally standardized advertising? A) a campaign that is identical in all markets B) a campaign that meets the legal and ethical standards of all countries C) a campaign that is similar but not identical from market to market D) a campaign that depends primarily on push rather than pull promotion

Q: Promotion using direct selling techniques is ________. A) a pull strategy B) necessary where inflation is high C) a standardized advertising technique D) a push strategy

Q: A pull rather than a push strategy is most likely preferable when ________. A) self-service is not predominant B) the price of a product is high relative to incomes C) there are few governmental restrictions on advertising D) there are a large number of languages and a low literacy rate

Q: A push strategy for international sales is most likely preferable to a pull strategy when ________. A) there are few prohibitions on advertising B) the price of the product is high relative to incomes C) people rely on friends' opinions before buying a product D) literacy rates are high

Q: Which of the following best depicts a push strategy for a U.S. company selling in Mexico? A) Tupperware selling through parties in homes B) Gillette selling razor blades through supermarkets C) KFC selling chicken dinners at its franchises D) Google advertising on television

Q: What is the LEAST likely reason that international companies are concerned about the gray market? A) undermining the long-term viability of the distributorship system B) causing a firm's operations in different countries to compete against each other C) requiring companies to make frequent price adjustments to capture the market D) preventing companies from charging what the market will bear in each country

Q: What is the gray market? A) sales targeted to elderly consumers B) selling goods through unofficial distributors C) a legal black market run by governments D) selling counterfeit merchandise

Q: Which of the following would LEAST likely be caused by a high inflation rate? A) rules against increasing export prices B) inability to quote prices in letters or catalogs C) difficulty making changes to vending machines D) necessity to set an equivalent value in a stable currency

Q: Why does price escalation most likely occur in exporting? A) The WTO requires that prices increase. B) Companies rely on skimming price strategies. C) Greater distances and more intermediaries increase distribution costs. D) Uncertain currency value changes necessitate charging higher prices.

Q: Foreman Enterprises produces and sells a variety of products for the home. Foreman recently introduced a new detergent at a very low price with the hope that a high number of consumers will try it out. Foreman is most likely using a ________ strategy. A) cost-plus B) skimming C) penetration D) diversification

Q: Dixon Electronics recently introduced a new computer with features unavailable from other products on the market. Dixon is charging a very high price for the computer and has plans to progressively lower the price over the next year. Dixon is most likely using a ________ strategy. A) cost-plus B) skimming C) penetration D) diversification

Q: Executives want to set export prices below those that the firm charges domestically. What is the most likely problem the company will experience? A) WTO antidumping regulations B) consumer complaints C) FDI restrictions D) high tariffs

Q: A company would most likely export at a price lower than its production and distribution costs in order to ________. A) use a skimming strategy abroad before using one domestically B) test a market before making a big commitment C) use a cost-plus strategy globally D) encourage gray market sales

Q: Diversity of international markets and currency instability have the greatest effect on ________. A) promotion B) R&D C) branding D) pricing

Q: If a company's foreign sales per customer is small compared to those in its domestic market, it should most likely ________. A) introduce a larger family of products B) narrow the product line offered to the market C) reconfigure the product life cycle marketing strategy D) shift additional salespeople to the domestic market

Q: Why might companies sometimes narrow the product line that they sell in a foreign country as compared to the product line they sell at home? A) Government restrictions typically limit how many products a company can sell locally. B) Selling cost per unit increases substantially when a company offers a broad product line. C) Not all products have sufficient demand in every market. D) Firms cannot sell products with product line gaps.

Q: Critics complain that pharmaceutical research budgets emphasize non-debilitating conditions common in developed countries rather than life-threatening diseases common in developing countries. People answering this criticism have contended that ________. A) correction of developed country conditions, such as balding, are necessary to stimulate developing country innovations that push global economic growth B) very small portions of research budgets actually target these non-debilitating conditions C) by being located almost entirely in developed countries, pharmaceutical companies lack access to locations where they can study diseases such as malaria and sleeping sickness D) pharmaceutical companies cannot recoup expenses for research on some of the developing country problems, so governmental research centers and nonprofit foundations should handle this research

Q: Firms alter their products for foreign markets for all of the following reasons EXCEPT ________. A) home country export requirement B) religious differences abroad C) weak infrastructures in some countries D) to respond to legal requirements

Q: What is the most likely reason that companies such as Gillette (razor blades) and 3M (scouring pads) sell products in smaller package sizes in some developing countries? A) Family size is small in those countries. B) Some governments require the smaller sizes. C) In those countries, many consumers lack sufficient cash to buy larger quantities. D) These are products for which the cost of altering package size is negligible.

Q: Agreements on international product standards are hampered by all the following factors EXCEPT ________. A) that standardization increases production costs B) consumer reluctance to change C) the cost of redesigning and retooling D) governments' desires to protect investments

Q: Some critics complain that MNEs introduce and promote superfluous products in developing countries, causing consumers there to buy these products rather than things they need for their health. People answering this criticism have contended that ________. A) consumers don't buy things because of promotion B) the amount spent on so-called superfluous products is insignificant C) it is impossible to draw a line between people who can afford and people who can't afford these products D) these products serve to motivate people in developing countries to work harder

Q: Why do you think corporate universities are becoming more popular among MNEs? How do both MNEs and employees benefit from corporate universities?

Q: Why is it essential for MNEs to consider coordination systems when implementing an organizational structure? Briefly describe each approach to coordination.

Q: What role does a firm's strategy play in determining organizational structure? Why are boundaries problematic for firms with international strategies?

Q: What is the difference between a classical structure and a neoclassical structure? Provide examples of each type.

Q: In a brief essay, discuss how decentralized management and organizational culture affect Johnson & Johnson.

Q: Describe how an MNE might use reports as a control mechanism.

Q: Profile the causes and likely benefits that prompt companies to consider adopting a neoclassical structure.

Q: Explain the major types of classical organization structures and the advantages and disadvantages of each for international operations.

Q: Profile the idea and features of horizontal differentiation, paying particular attention to its implications to how managers design their company's structure.

Q: How might centralization of decision making adversely affect local managers in an MNE?

Q: The open source model is a hyperarchy that involves giving source code to volunteers who fix software bugs.

Q: The primary benefit of neoclassical structures is the ability of MNEs to coordinate responses and maintain effective control of various units.

Q: Neoclassical structures promote tightly connected networks both vertically and horizontally to ensure that strategic requirements are fulfilled.

Q: According to the unity-of-command principle, workers and organizations benefit the most from dual hierarchies of communication.

Q: 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."

Q: The common values shared by a company's employees are known as its organization culture.

Q: The benefits of managerial visits to foreign subsidiaries can easily be replicated with frequently submitted and reviewed operational reports and schedules.

Q: MNEs use different report formats and schedules for foreign operations according to local customs.

Q: Adopting a market control system requires that the MNE uses external market mechanisms to establish internal performance benchmarks and standards.

Q: MNEs typically design their control systems in terms of either market control, bureaucratic control, or adaptation control.

Q: Coordination by plan deals with exact rules and procedures that spell out what needs to be done and how.

Q: Coordination methods include mutual adjustment, planning, and standardization.

Q: The keiretsu structure long used by Japanese companies is an example of virtual organization.

Q: 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.

Q: A common feature of neoclassical structures is greater cross-functional collaboration.

Q: Neoclassical structures aim to centralize decision-making authority by removing boundaries that impede the decentralization of decision making.

Q: A matrix organization is a hybrid of the functional and geographic organizations.

Q: In a matrix structure, product, functional, or geographic groups compete for resources.

Q: 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.

Q: Companies tend to use geographic divisions when they have large foreign operations that are not dominated by a single country or market.

Q: A divisional structure tends to be adopted by firms that are diversified by products or markets.

Q: The functional structure is ideal when the company faces complex and changing environments.

Q: The functional structure is inappropriate for firms with products and manufacturing methods that are largely undifferentiated among countries.

Q: Technology such as e-mail, VoIP, teleconferencing, and social networks help MNEs respond to increasing globality.

Q: Horizontal differentiation is concerned with how the managers of a firm decide to divide the company into discrete subunits.

Q: One advantage of centralized corporate practices is a reduced risk that lower-level employees make costly, wrong decisions.

Q: Decentralization has the key advantage of letting decisions be made by those who directly deal with customers, competitors, and markets.

Q: A firm's vertical differentiation determines where in its organization structure managers have decided to concentrate decision-making authority.

Q: New configurations of value activities create coordination and control challenges that cannot be addressed by the functionality outlined in a formal structure.

Q: 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.

Q: 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

Q: 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

Q: 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.

Q: ________ 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

Q: 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

Q: 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)

Q: 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

Q: Formal reports, management performance evaluations, and financial metrics are three examples of ________. A) coordinating tools B) coordinating systems C) control systems D) control mechanisms

Q: Grover Enterprises is an MNE that relies on shared values among all employees to idealize the preferred behaviors and identify performance measures within the company. Grover is most likely applying a system of ________. A) market control B) bureaucratic control C) planning control D) clan control

Q: Martin Manufacturing is an MNE that centralizes authority to implement an extensive set of rules and procedures to govern a broad range of activities. Martin Manufacturing is most likely applying a system of ________. A) market control B) adjustment control C) bureaucratic control D) clan control

Q: Falcon Enterprises is an MNE that uses price competition and relative market share to establish internal performance benchmarks and standards. The firm is most likely applying a system of ________. A) bureaucratic control B) market control C) standardization control D) clan control

Q: Three types of control systems are used in MNEs. These are ________. A) market control, bureaucratic control, and clan control B) standardization control, adjustment control, and clan control C) market control, adjustment control, and clan control D) planning control, market control, and clan control

Q: Abel Enterprises has implemented a system based on coordination by mutual adjustment. Which of the following would most likely be used by Abel Enterprises? A) strict scheduling B) social networking C) synchronized training D) centralized decision making

Q: Which of the following begins with a company defining critical success factors and specifying objective targets and hard deadlines? A) coordination by standardization B) coordination by consensus C) coordination by plan D) coordination by intervention

Q: Patrons of McDonald's can enter the restaurant located in any part of the world and expect to see employees wearing the same uniforms and menus offering the same products. McDonald's most likely uses which system of coordination? A) standardization B) consensus C) plan D) adaptation

Q: Which of the following is NOT one of the three prevalent approaches to coordination? A) standardization B) mutual adjustment C) adaptation D) planning

Q: Coordination refers to ________. A) linking various value activities within an organization B) identifying the span of control within an organization C) portioning the performance of specific tasks D) assigning tasks to qualified managers

Q: A hyperarchy is ________. A) a form of structure with precise superior and subordinate relationships B) a form of structure that relies on extensive centralization C) a large-scale, self-organizing community D) analogous to a hierarchy

Q: Some MNEs that have tried contemporary structures have run into problems, most notably ________. A) frequent managerial intervention in decision making B) relentless centralization of decision making C) employees too motivated by bonuses D) resource competition