BUS 479
If an international firm has a global strategy and a relatively low level of product diversity, the best choice for its organizational structure is?
Worldwide product division
The three primary means by which a firm can diversify are:
mergers and acquisitions; joint ventures and strategic alliances; internal development.
All of the following are guidelines for managing strategic alliances EXCEPT
Relying primarily on a contract to make the joint venture work
All of the following are disadvantages of a divisional type of organizational structure EXCEPT
There is separation of strategic and operating control
A company offering local telecommunications service combines resources with an international company that manufactures digital switching equipment to research a new type of telecommunications technology. This is an example of
strategic alliance
bought Miller Brewing and used its marketing expertise to improve Miller's market share. This justification for diversification is best described as
Capitalizing on core competencies
When an organization with a functional structure diversifies into related product-markets, it generally
Develops a divisional structure
Which of the following is a disadvantage of a functional type of organizational structure?
Differences in functional orientation may impede communication and coordination.
Strategic business unit (SBU) and holding company structures result from extensive
Diversification
"Identifies assets and activities that are rare, distinctive, and valuable" describes which of the following concepts?
Insight
Which of the following is not a boundaryless organizational design?
Matrix
Transaction costs include all of the following costs EXCEPT
agency costs
The corporate office of Cooper Industries adds value to its acquired businesses by performing such activities as auditing their manufacturing operations, improving their accounting activities, and centralizing union negotiations. This is an example of
attaining the benefits of parenting through unrelated diversification.
"A well-crafted corporate theory identifies complementarity that the company is singularly able to assemble or pursue by acquiring assets that can be combined with existing ones to create value."
cross-sight
A strategy of related diversification requires most firms to organize around geographical areas or product lines. This type of organizational growth leads to a(n)
divisional structure
A new firm with simple structure typically increases its sales revenue and volume of outputs over time.
functional structure
At ABC Corporation, work is divided into units that specialize in production, marketing, research and development, and other management tasks. This is an example of a
functional structure
A simple structure is characterized by
low specialization and high centralization.
Complicated working relationships, intense power struggles, and excessive reliance on group processes are disadvantages of which type of organizational structure?
matrix
When management uses common production facilities or purchasing procedures to distribute different but related products, they are
sharing activities
Sharing core competencies is one of the primary potential advantages of diversification. In order for diversification to be most successful, it is important that
the similarity required for sharing core competencies must be in the value chain, not in the product
Vertical integration is attractive when
transaction cost are higher than internal admin costs
Unbalanced capacities that limit cost savings, difficulties in combining specializations, and reduced flexibility are disadvantages associated with ___________.
vertical integration