MAN6635 EXAM 1 QUESTIONS AND
ANSWERS (GRADED A+)
Organizational Structure - ANSWER-How jobs and tasks are divided and coordinated
between individuals and groups within the company, an outcome of design
Organizational Design - ANSWER-a process or style used by management to arrange
the components of structure
Functional Structure - ANSWER-functional departmentalization and high centralization.
•very efficient
•tend to be inflexible and insensitive to subtle
differences across products, regions, or clients •most appropriate in stable, predictable
environments
President --- VP Finance, VP Marketing, VP R&D
Divisional Structure - ANSWER-workflow departmentalization and low levels of
centralization.
•not very efficient
•tend to be more flexible and innovative
•tend to be sensitive to subtle differences across
products, regions, or clients
Product Structure
President -- VP Electronics (Finance, Marketing R&D) , VP Home furnishings (Finance,
Marketing R&D), VP Automotive (Finance, Marketing R&D)
Client Based Structure
President -- VP Direct Sales (Finance, Marketing R&D) , VP Internet Sales (Finance,
Marketing R&D), VP Large Vendor Contracts (Finance, Marketing R&D)
Geographic Structure
Assume our company, HRM Suppliers, sells 2 distinct product lines, bombs and baby
formula. What type of structural configuration would be most appropriate, a divisional or
functional structure? Why? - ANSWER-Functional Structure
What is organizational design impacted by? - ANSWER-Business Environment
•Consists of customers, competitors, suppliers, distributors, and other factors external
to the firm
•Global Presence
, Company Strategy
•Low-Cost vs. Product Differentiation
Company Size
•As companies become larger, they need to rely on some combination of specialization,
formalization, and centralization to control activities
Multinational Enterprise Organizational Design Challenges - ANSWER-Integration; local
responsiveness problem...coordinating and balancing the opposing forces of integrating
their foreign operation
International Organizational Structure - ANSWER-•Weak pressures for local
responsiveness and weak
pressures for worldwide integration
•Foreign subsidiaries dependent on headquarters for resources and limited direction,
but still have major freedom to adapt to local conditions
Multi-domestic Organizational Structure - ANSWER-concentrates efforts on location
•Strong pressures for local responsiveness and weak pressures for worldwide
integration
•Subsidiaries in multiple countries operate independently within each country,
independently of operations in other countries, and often fairly independently of parent
company headquarters
•Each national market seen as a specialized market for its particular subsidiaries
products
Global Organizational Structure - ANSWER-•Strong pressures for local responsiveness
and strong pressures for
worldwide integration
•Structure resembles a centralized hub where foreign subsidiaries are heavily managed
and controlled by headquarters
•Products and services are generally designed for and marketed to customers all over
the world
Transnational Organizational Structure - ANSWER-• Weak pressures for local
responsiveness and strong pressures for worldwide integration
• Has a truly global focus, making resource decisions without reference to national
origins, sharing its ideas and technology with all units on a global scale, while cultivating
the local character in all of its individual businesses
• Interdependence of resources and responsibilities across all business units regardless
of national boundaries
Cost strategy - ANSWER-•Strategy focuses on low costs of production
•Achieved through economies of scale, capitalizing on the experience curve, and
controlling overhead
ANSWERS (GRADED A+)
Organizational Structure - ANSWER-How jobs and tasks are divided and coordinated
between individuals and groups within the company, an outcome of design
Organizational Design - ANSWER-a process or style used by management to arrange
the components of structure
Functional Structure - ANSWER-functional departmentalization and high centralization.
•very efficient
•tend to be inflexible and insensitive to subtle
differences across products, regions, or clients •most appropriate in stable, predictable
environments
President --- VP Finance, VP Marketing, VP R&D
Divisional Structure - ANSWER-workflow departmentalization and low levels of
centralization.
•not very efficient
•tend to be more flexible and innovative
•tend to be sensitive to subtle differences across
products, regions, or clients
Product Structure
President -- VP Electronics (Finance, Marketing R&D) , VP Home furnishings (Finance,
Marketing R&D), VP Automotive (Finance, Marketing R&D)
Client Based Structure
President -- VP Direct Sales (Finance, Marketing R&D) , VP Internet Sales (Finance,
Marketing R&D), VP Large Vendor Contracts (Finance, Marketing R&D)
Geographic Structure
Assume our company, HRM Suppliers, sells 2 distinct product lines, bombs and baby
formula. What type of structural configuration would be most appropriate, a divisional or
functional structure? Why? - ANSWER-Functional Structure
What is organizational design impacted by? - ANSWER-Business Environment
•Consists of customers, competitors, suppliers, distributors, and other factors external
to the firm
•Global Presence
, Company Strategy
•Low-Cost vs. Product Differentiation
Company Size
•As companies become larger, they need to rely on some combination of specialization,
formalization, and centralization to control activities
Multinational Enterprise Organizational Design Challenges - ANSWER-Integration; local
responsiveness problem...coordinating and balancing the opposing forces of integrating
their foreign operation
International Organizational Structure - ANSWER-•Weak pressures for local
responsiveness and weak
pressures for worldwide integration
•Foreign subsidiaries dependent on headquarters for resources and limited direction,
but still have major freedom to adapt to local conditions
Multi-domestic Organizational Structure - ANSWER-concentrates efforts on location
•Strong pressures for local responsiveness and weak pressures for worldwide
integration
•Subsidiaries in multiple countries operate independently within each country,
independently of operations in other countries, and often fairly independently of parent
company headquarters
•Each national market seen as a specialized market for its particular subsidiaries
products
Global Organizational Structure - ANSWER-•Strong pressures for local responsiveness
and strong pressures for
worldwide integration
•Structure resembles a centralized hub where foreign subsidiaries are heavily managed
and controlled by headquarters
•Products and services are generally designed for and marketed to customers all over
the world
Transnational Organizational Structure - ANSWER-• Weak pressures for local
responsiveness and strong pressures for worldwide integration
• Has a truly global focus, making resource decisions without reference to national
origins, sharing its ideas and technology with all units on a global scale, while cultivating
the local character in all of its individual businesses
• Interdependence of resources and responsibilities across all business units regardless
of national boundaries
Cost strategy - ANSWER-•Strategy focuses on low costs of production
•Achieved through economies of scale, capitalizing on the experience curve, and
controlling overhead
