Question 1

In a typical matrix organization based on area and product dimensions, country managers will be responsible to both the area managers and the product line managers.

Accepted Answer

In a matrix organization, employees report to a functional manager (such as a product manager) as well as a geographic manager (such as a country manager). This allows for a dual reporting structure and cross-functional collaboration. Therefore, country managers will be responsible to both area and product line managers.

Question 2

Advantages of the virtual corporation concept include that it allows a company to build competence from the ground up and to increase management's control over the corporation's activities.

Accepted Answer

The advantages of the virtual corporation concept actually include increased flexibility, reduced costs, and access to a wide range of expertise and resources without incurring the full cost of employing them permanently. However, it may also mean a reduced control over the activities of the corporation, as it relies on external partners for many functions.

Question 3

Hybrid organizations are often the result of a regionally organized company having introduced a new and different product from what the regionally organized form is accustomed to handling.

Accepted Answer

Hybrid organizations often arise when a regionally organized company introduces a new and different product or service from what it is accustomed to handling. This can lead to the creation of a hybrid model that combines aspects of different organizational structures to effectively manage the new product line or service offering.

Question 4

An organization in which top-level divisions are required to heed input from a staff composed of experts of another organizational dimension in an attempt to avoid the double-reporting difficulty of a matrix organization but still mesh two or more dimensions is called a hybrid organization.

Accepted Answer

The answer of An organization in which top-level divisions are...

Question 5

A virtual corporation is also called a network organization.

Accepted Answer

A virtual corporation is a type of network organization that operates through partnerships, alliances, and collaborations with other entities to achieve its business goals. The term "virtual" implies that the corporation does not have a physical presence or headquarters but rather exists digitally through the use of technology.

Question 6

A matrix organization involves two or more dimensions, such as area and product, in which managers are at the same level but do not have overlapping responsibilities.

Accepted Answer

A matrix organization involves two or more dimensions, such as function and project, in which managers have overlapping responsibilities and report to both a functional manager and a project manager.

Question 7

The horizontal organization has been characterized as antiorganization because its designers try to remove the constraints imposed by the conventional organizational structure.

Accepted Answer

The statement is true. Horizontal organizations are designed to be less hierarchical and more flexible in their structure, allowing for greater collaboration and innovation. This is often perceived as "anti-organization" because it challenges traditional notions of how businesses and institutions should be structured.

Question 8

The matrix overlay organizational form attempts to eliminate some of the problems of the matrix organization.

Accepted Answer

The matrix overlay organizational form is a modification of the matrix organization that tries to address some of its weaknesses by creating two lines of authority - one for the functional areas and another for the projects. This can help clarify roles and responsibilities, reduce conflicts, and increase accountability.

Question 9

All decisions are made either at the IC headquarters or at the subsidiary level.

Accepted Answer

Decisions can also be made at intermediate levels such as regional offices or departmental levels within subsidiaries.

Question 10

Strategic business units are an organizational form in which geographic divisions have been defined as though they were distinct, independent businesses.

Accepted Answer

Strategic business units (SBUs) are organizational entities with a specific market focus and a manager with sales and profit responsibility, not necessarily defined by geographic divisions. They can be based on product lines, customer segments, or other strategic focuses, rather than geographic locations.

Question 11

In a firm without a global product policy, the preference of the operations management people in the home office has always been to localize the product or at least the production process in as many overseas plants as possible.

Accepted Answer

The answer of In a firm without a global product...

Question 12

A form of organization characterized by lateral decision processes, horizontal networks, and a strong corporatewide business philosophy is a horizontal corporation.

Accepted Answer

The statement correctly describes a horizontal corporation.

Question 13

According to the text, every successful company uses controls to put its plans into effect, evaluate, correct, and reward.

Accepted Answer

The text states that "Every successful company uses controls to put its plans into effect, evaluate, correct, and reward."

Question 14

According to the text, an organization that coordinates economic activity to deliver value to customers using resources outside its traditional boundaries is an integrated corporation.

Accepted Answer

An organization that coordinates economic activity to deliver value to customers using resources outside its traditional boundaries is known as a networked organization, not an integrated corporation. Integrated corporations typically consolidate resources and activities within their boundaries.

Question 15

The more familiar, or the more similar, conditions in the host country are perceived to be, the more likely headquarters is to rely on subsidiary management.

Accepted Answer

The answer of The more familiar, or the more similar,...

Question 16

The rapidly changing business environment caused by increased global competition, customer preference for custom-made rather than mass-produced products, and faster technological change is pressuring companies to make greater use of global product structures.

Accepted Answer

The answer of The rapidly changing business environment caused by...

Question 17

Moving executives around an IC system can increase confidence and mutual reliance.

Accepted Answer

Moving executives around an IC system allows them to gain a better understanding of different parts of the organization and develop relationships with colleagues in different departments, which can increase their confidence in each other and promote mutual reliance.

Question 18

A business entity with a clearly defined market, specific competitors, the ability to carry out its business mission, and a size appropriate for control by a single manager is a strategic operating unit.

Accepted Answer

The answer of A business entity with a clearly defined...

Question 19

Companies controlled by other companies through ownership of enough voting stock to elect majorities on the board of directors are called subsidiaries or affiliates.

Accepted Answer

This is a correct statement. Companies that are controlled by another company through owning enough voting stock to elect majorities on their board of directors are subsidiaries or affiliates.

Question 20

As the 21^st century evolves, it is expected that managers will make greater use of the dynamic network structure to integrate smaller units into an operation better coordinated by a large central headquarters organization.

Accepted Answer

The dynamic network structure actually involves decentralizing and outsourcing many functions to specialized, often smaller, firms rather than coordinating through a large central headquarters. This structure allows for more flexibility and responsiveness to changing market conditions.

Quiz 10: Organizational Design and Control