MAN6635 EXAM 1 QUESTIONS AND ANSWERS
Organizational Structure - CORRECT ANSWER✅✅Formally dictates how jobs and tasks are divided and
coordinated between individuals and groups within the company
Organizational Structure is an outcome
Organizational Design - CORRECT ANSWER✅✅Process or style used by management to arrange the
components of structure
Organizational design is a process
Functional Structure - CORRECT 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
Likely to be appropriate for most MNEs
Efficient due to lack of repeated functions and inflexible due to lack of specialization
Most appropriate with few similar products or if you sell to one region or customer base
Divisional Structure - CORRECT 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
Not very efficient due to repeated functions, but flexible due to specialization
Most appropriate when there are multiple distinct product lines. Common divisions are product lines,
geographical locations, or client types
Global Matrix Structure - CORRECT ANSWER✅✅Involve two or more lines of reporting
· Typically a country "leg" with managers reporting to local and HQ supervisors
At best, allows local and global realities to be reconciled
At worst, allows managers to pursue narrow objectives without regard for other "legs" on the matrix
, Create divided loyalties due to having different supervisors and bosses in different parts of the world
· Loyalty tends to be local
Integrates traditional business functions with country and product
Elements of Organizational Structure - CORRECT ANSWER✅✅work specialization, chain of command,
span of control, centralization, formalization
Work Specialization - CORRECT ANSWER✅✅Degree to which tasks in an organization are divided into
separate jobs
Chain of Command - CORRECT ANSWER✅✅Answers "who reports to whom?" and signifies formal
authority relationships
Span of Control - CORRECT ANSWER✅✅Represents how many employees each manager in the
organization has responsibility for
Centralization - CORRECT ANSWER✅✅Refers to where decisions are formally made in the organization
Formalization - CORRECT ANSWER✅✅Degree to which rules and procedures are used to standardize
behaviors and decisions in an organization
Organizational Design - CORRECT ANSWER✅✅Process of creating, selecting, or changing the structure
of an organization
Organizational Design impacted by - CORRECT 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
Organizational Structure - CORRECT ANSWER✅✅Formally dictates how jobs and tasks are divided and
coordinated between individuals and groups within the company
Organizational Structure is an outcome
Organizational Design - CORRECT ANSWER✅✅Process or style used by management to arrange the
components of structure
Organizational design is a process
Functional Structure - CORRECT 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
Likely to be appropriate for most MNEs
Efficient due to lack of repeated functions and inflexible due to lack of specialization
Most appropriate with few similar products or if you sell to one region or customer base
Divisional Structure - CORRECT 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
Not very efficient due to repeated functions, but flexible due to specialization
Most appropriate when there are multiple distinct product lines. Common divisions are product lines,
geographical locations, or client types
Global Matrix Structure - CORRECT ANSWER✅✅Involve two or more lines of reporting
· Typically a country "leg" with managers reporting to local and HQ supervisors
At best, allows local and global realities to be reconciled
At worst, allows managers to pursue narrow objectives without regard for other "legs" on the matrix
, Create divided loyalties due to having different supervisors and bosses in different parts of the world
· Loyalty tends to be local
Integrates traditional business functions with country and product
Elements of Organizational Structure - CORRECT ANSWER✅✅work specialization, chain of command,
span of control, centralization, formalization
Work Specialization - CORRECT ANSWER✅✅Degree to which tasks in an organization are divided into
separate jobs
Chain of Command - CORRECT ANSWER✅✅Answers "who reports to whom?" and signifies formal
authority relationships
Span of Control - CORRECT ANSWER✅✅Represents how many employees each manager in the
organization has responsibility for
Centralization - CORRECT ANSWER✅✅Refers to where decisions are formally made in the organization
Formalization - CORRECT ANSWER✅✅Degree to which rules and procedures are used to standardize
behaviors and decisions in an organization
Organizational Design - CORRECT ANSWER✅✅Process of creating, selecting, or changing the structure
of an organization
Organizational Design impacted by - CORRECT 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
