Test Bank For Organization Theory And Design 12th Edition by Richard L. Daft

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Test Bank For Organization Theory And Design 12th Edition by Richard L. Daft

1. _____ refers to the number and variety of products and services a company offers as well as the number and variety of regions, countries, and markets it serves.
a.  Integrator
b.  Cooptation
c.  Domain
d.  Scope
ANSWER:   d
RATIONALE:   Feedback: Scope refers to the number and variety of products and services a company offers as well as the number and variety of regions, countries, and markets it serves.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-01 – 06-01
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

2. In the _____ stage of international development, market potential is limited and is primarily in the home country.
a.  domestic
b.  international
c.  multinational
d.  global
ANSWER:   a
RATIONALE:   Feedback: In the first stage of international development, the domestic stage, a company is domestically oriented, but managers are aware of the global environment and may want to consider initial foreign involvement to expand production volume and realize economies of scale. Market potential is limited and is primarily in the home country.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

3. Hill Fog is a brand of bottled water in India. Asif, the marketing manager at Hill Fog, is aware of the global environment and is considering initial foreign involvement in the United States to expand production volume and realize economies of scale. Hill Fog is in the _____ stage of international development.
a.  multinational
b.  international
c.  domestic
d.  global
ANSWER:   c
RATIONALE:   Feedback: Hill Fog is in the domestic stage of international development. In the first stage of international development, the domestic stage, a company is domestically oriented, but managers are aware of the global environment and may want to consider initial foreign involvement to expand production volume and realize economies of scale. Market potential is limited and is primarily in the home country.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Reflective Thinking
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Apply

4. In the context of international development, _____ means competitive issues in each country are independent of other countries; a company deals with each country individually.
a.  domestic
b.  multidomestic
c.  multinational
d.  global
ANSWER:   b
RATIONALE:   Feedback: In the second stage of international development, the international stage, a company takes exports seriously and begins to think multidomestically. Multidomestic means competitive issues in each country are independent of other countries; the company deals with each country individually.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

5. Which of the following is a difference between the domestic and international stages of international development?
a.  The domestic stage is export-oriented, while the international stage is globally oriented.
b.  In the domestic stage, the market potential is limited, while in the international stage, the market potential is large.
c.  In the domestic stage, managers are concerned about international competitive positioning, while in the international stage, managers consider initial foreign involvement.
d.  The domestic stage is structural, while the international stage is functional.
ANSWER:   b
RATIONALE:   Feedback: In the first stage of international development, the domestic stage, a company is domestically oriented. In the second stage, the international stage, the company takes exports seriously and begins to think multidomestically.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

6. In the _____ stage of international development, a company has extensive experience in a number of international markets and has established marketing, manufacturing, or research and development (R&D) facilities in several foreign countries.
a.  domestic
b.  international
c.  multinational
d.  global
ANSWER:   c
RATIONALE:   Feedback: In the multinational stage of international development, a company has extensive experience in a number of international markets and has established marketing, manufacturing, or research and development (R&D) facilities in several foreign countries. The organization obtains a large percentage of revenues from sales outside the home country.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

7. Quidpro, a food and beverage company based in Germany, gets most of its sales from outside its home country. Its employees are spread all over the world. The CEO is Belgian, the chairman was born in Austria, and more than half of the company’s managers are non-Germans. The company has hundreds of brands and has production facilities or other operations in almost every country in the world. Quidpro is in the _____ stage of international development.
a.  multinational
b.  international
c.  domestic
d.  global
ANSWER:   d
RATIONALE:   Feedback: Quidpro is in the global stage of international development. In this stage, the company transcends any single country. The business is not merely a collection of domestic industries; rather, subsidiaries are interlinked to the point where competitive position in one country significantly influences activities in other countries. Truly global companies no longer think of themselves as having a single home country and, indeed, have been called stateless corporations.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Reflective Thinking
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Apply

8. Penrose Inc. is an American corporation that provides business consulting, information technology, and outsourcing services. The company has extensive experience in a number of international markets and has established facilities in several foreign countries. Penrose Inc. is in the _____ stage of international development.
a.  multinational
b.  international
c.  domestic
d.  global
ANSWER:   a
RATIONALE:   Feedback: Penrose Inc. is in the multinational stage of international development. In this stage, the company has extensive experience in a number of international markets and has established marketing, manufacturing, or research and development (R&D) facilities in several foreign countries.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Reflective Thinking
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Apply

9. In the _____ stage of international development, a company transcends any single country.
a.  domestic
b.  international
c.  multinational
d.  global
ANSWER:   d
RATIONALE:   Feedback: The fourth and ultimate stage of international development is the global stage, which means a company transcends any single country. The business is not merely a collection of domestic industries; rather, subsidiaries are interlinked to the point where competitive position in one country significantly influences activities in other countries.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-02 – 06-02
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Entering the Global Arena
KEYWORDS:   Bloom’s: Remember

10. _____ refers to the quality of collaboration across organizational units.
a.  Contingency
b.  Standardization
c.  Coordination
d.  Sustainability
ANSWER:   c
RATIONALE:   Feedback: As organizations become more differentiated, with multiple products, divisions, departments, and positions scattered across numerous countries, managers face a tremendous coordination challenge. Coordination refers to the quality of collaboration across organizational units.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-03 – 06-03
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   The Challenges of Global Design
KEYWORDS:   Bloom’s: Remember

11. The _____ means that product design, manufacturing, and marketing strategy are standardized throughout the world, which is less costly than creating different products for different markets.
a.  globalization strategy
b.  standardization strategy
c.  export strategy
d.  multidomestic strategy
ANSWER:   a
RATIONALE:   Feedback: The globalization strategy means that product design, manufacturing, and marketing strategy are standardized throughout the world, which is less costly than creating different products for different markets. For example, Black & Decker became much more competitive internationally when it standardized its line of power hand tools.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-04 – 06-04
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Remember

12. Which of the following is true of a globalization strategy?
a.  It encourages product design, assembly, and marketing tailored to the specific needs of each country.
b.  It can save a company money because it helps reap economy-of-scale efficiencies by standardizing product design and manufacturing.
c.  It divides the world into geographic regions, with each geographic division reporting to the CEO.
d.  It works best when pressure for decision making balances the interests of both product standardization and geographic localization.
ANSWER:   b
RATIONALE:   Feedback: A globalization strategy can save a company money because it helps reap economy-of-scale efficiencies by standardizing product design and manufacturing, using common suppliers, introducing products around the world faster, coordinating prices, and eliminating overlapping facilities.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-04 – 06-04
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

13. A(n) _____ means that competition in each country is handled independently of competition in other countries.
a.  globalization strategy
b.  standardization strategy
c.  export strategy
d.  multidomestic strategy
ANSWER:   d
RATIONALE:   Feedback: A multidomestic strategy means that competition in each country is handled independently of competition in other countries. Thus, a multidomestic strategy would encourage product design, assembly, and marketing tailored to the specific needs of each country.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-04 – 06-04
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Remember

14. Which of the following is true of a multidomestic strategy?
a.  It allows a company to take responsibility for global operations in its specific product area.
b.  It encourages product design, assembly, and marketing tailored to the specific needs of each country.
c.  It delegates responsibility and decision-making authority in some areas, such as adapting products or services to meet local needs.
d.  It enables an organization to achieve multinational flexibility and rapid response.
ANSWER:   b
RATIONALE:   Feedback: A multidomestic strategy means that competition in each country is handled independently of competition in other countries. Thus, a multidomestic strategy would encourage product design, assembly, and marketing tailored to the specific needs of each country.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-04 – 06-04
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

15. Which of the following is true of international divisions?
a.  They are typically organized along functional or product lines.
b.  They move organizations from more sophisticated international operations to domestic divisions.
c.  They have their own hierarchy to handle businesses in various countries.
d.  They sell products and services created by international operations in domestic markets.
ANSWER:   c
RATIONALE:   Feedback: As companies begin to explore international opportunities, they typically start with an export department that grows into an international division. The international division has its own hierarchy to handle business (licensing, joint ventures) in various countries, selling the products and services created by the domestic divisions, opening subsidiary plants, and in general moving the organization into more sophisticated international operations.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-04 – 06-04
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

16. Which of the following is a difference between the international division and the domestic division of a company?
a.  The international division uses a global matrix structure, while the domestic division does not use a global matrix structure.
b.  The international division is organized according to geographic interests, while the domestic division is typically organized along functional or product lines.
c.  The international division is placed above other divisions and departments within the company, while the domestic division has a status equal to other major departments or divisions within the company.
d.  The international division does not have its own hierarchy to handle business, while the domestic division has its own hierarchy to handle business.
ANSWER:   b
RATIONALE:   Feedback: The international division has a status equal to the other major departments or divisions within the company. Whereas the domestic divisions are typically organized along functional or product lines, the international division is organized according to geographic interests.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-05 – 06-05
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

17. Which of the following structures is great for standardizing production and sales around the globe?
a.  Global matrix structure
b.  Global product structure
c.  Global dynamic structure
d.  Global geographic structure
ANSWER:   b
RATIONALE:   Feedback: In a global product structure, the product divisions take responsibility for global operations in their specific product area. The product structure is great for standardizing production and sales around the globe.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-05 – 06-05
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

18. Which of the following is true of a global product structure?
a.  It provides a fairly straightforward way to effectively manage a variety of businesses and products around the world.
b.  It provides a way to achieve vertical and horizontal coordination simultaneously along two dimensions.
c.  It works best when pressure for decision making balances the interests of both product standardization and geographic localization.
d.  It enables a global firm to achieve aspects of both global uniformity and local diversification and responsiveness.
ANSWER:   a
RATIONALE:   Feedback: In a global product structure, the product divisions take responsibility for global operations in their specific product area. It provides a fairly straightforward way to effectively manage a variety of businesses and products around the world.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-05 – 06-05
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

19. Companies that use a _____ have typically been those with mature product lines and stable technologies.
a.  global dynamic structure
b.  global geographic structure
c.  global matrix structure
d.  global product structure
ANSWER:   b
RATIONALE:   Feedback: The global geographic structure divides the world into geographic regions, with each geographic division reporting to the CEO. Companies that use the global geographic structure have typically been those with mature product lines and stable technologies.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-05 – 06-05
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand

20. Which of the following is true of a global matrix structure?
a.  It coordinates sales and marketing initiatives across all geographic locations.
b.  It divides the world into geographic regions, with each geographic division reporting to the CEO.
c.  It provides a fairly straightforward way to effectively manage a variety of businesses and products around the world.
d.  It provides a way to achieve vertical and horizontal coordination simultaneously along two dimensions.
ANSWER:   d
RATIONALE:   Feedback: A global matrix structure provides a way to achieve vertical and horizontal coordination simultaneously along two dimensions. The matrix works best when pressure for decision making balances the interests of both product standardization and geographic localization and when coordination to share resources is important.
POINTS:   1
LEARNING OBJECTIVES:   ORGT.DAFT.16.06-05 – 06-05
NATIONAL STANDARDS:   United States – AACSB: Analytic
TOPICS:   Designing Structure to Fit Global Strategy
KEYWORDS:   Bloom’s: Understand