Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
40 Cards in this Set
- Front
- Back
|
Where do new market pressures come from? |
- Structural changes in the industries - Technological innovations - Convergence of consumer tastes, globally - Political/legislative changes - Global media and communications |
|
|
Strengths of Product-Market grouping |
- allows units to adapt flexibly to difference in products, regions, clients - suitable for rapid changes in unstable environments - Client satisfaction because the client knows exactly where to go - Excellent coordination - Decentralized decision making Best for large companies with several product lines |
|
|
Weaknesses of Product-Market grouping |
- prevents economies of scale in functional departments - prevents the development of in-depth knowledge in functional competences and technical specialization - difficult to integrate functions and standardize processes across product lines - poor coordination across product lines |
|
|
Strengths of functional grouping |
- economies of scale in functional competences - allows for the development of in-depth knowledge in functional areas - brings together experts who speak the same language - facilitates standardization of processes - Simpler - Helps the organization fulfill its functional objectives - promotes specialization |
|
|
Weaknesses of functional grouping |
- poor horizonal coordination across departments (difficult to handle various product and service lines; processes across functions cause alterations) - Slow response time to changes in the environment - Decisions pile up; hierarchy overload - Different departments have different priorities and they may only care about their own bottom line, ignoring the bigger picture. It promotes a narrow and restrictive view of organizational objectives. |
|
|
When do structures get transformed? |
- When there is growth - When there is differentiation of products, markets, customers - Where communications channels have been saturated |
|
|
Tell me about the invention of brand management and why its important in the context of organizations |
n/a |
|
|
Strengths of the Matrix structure |
Achieves coordination necessary to meet dual demands from customers - Flexible sharing of human resources - Suited for complex decisions and frequent changes in unstable environments - Provides opportunity for both functional and product skill development |
|
|
What two variables distinguish structures? |
Height and width Extent to which hierarchical management is observed |
|
|
What factors does the height of an organization encompass? |
- Number of layers within a structure - Complexity of tasks proposed in a strategy - Facilitates the engagement of specialist managers |
|
|
What factors does the width of an organization encompass? |
- Refers to centralization or de-centralization |
|
|
What are the trade-offs between the costs and benefits associated with the width of an organization? |
- advantages of centralization: tighter direct control; better for smaller organizations with few product or market segments - advantages of decentralization: you can develop localized and specialized knowledge when you operate in several markets |
|
|
What factors does the contingency approach depend on? |
- nature of business and strategy - size - geographical span of activities - age/history - culture - leadership style |
|
|
Configuration approach? |
- job specialization - span of control - need for formalization - centralization vs decentralization - unit grouping (function vs market served) *seeks to proactively determine the structure that the organization should adopt* |
|
|
Tell me about export departments |
- Found in companies in early stages of internationalization. Foreign sales are minimal and foreign markets are supplied mainly through domestic production and exports. - Knowledge of foreign markets is concentrated in a single department - Weaknesses: conflicts will arise between domestically oriented product divisions and export department regarding whats more important: domestic sales or exports; export department is dependent on domestic product divisions for both product and technology. |
|
|
Mother-Daughter structures |
- suited for new foreign investors where foreign operations ar enot of crucial importance to the parent company; and suited for businesses with extensive FDIs but limited central resources - Advantage: encourages subsidiary innovation by substituting their autonomy for centralized control - Disadvantage: lack of global coordination and planning |
|
|
International divisional structure |
- Majority of US and some japanese and euro companies - Strengths and weaknesses similar to export department - International knowledge and expertise is concentrated in one division |
|
|
Advantages of Global Matrix structure |
- Advantage: you can achieve both global coordination and national responsiveness - Main advantage: can accommodate managers with worldwide product responsibilities for particular businesses AND accommodate country managers responsible for specific area markets |
|
|
Disadvantage of Global Matrix structure |
- overlapping responsibilities - duplications of: reporting, information, communications and activities - excessive time spent on reaching compomised decisions - increased administrative costs |
|
|
How can companies improve their flow of innovation? How can they enhance that process? |
Combining technical know-how and market knowledge and expertise - can enhance by looking far and wide, rather than just locally. |
|
|
According to the reading "Is your innovation process global?" what is a key challenge for companies? |
Accessing sufficiently diverse knowledge |
|
|
Tell me about geographic lodes of knowledge and how they can happen |
- different countries have developed different expertise due to necessity. For example: High cost of land in Japan has forced companies to become experts in JIT production to minimize inventory. - Increasing dispersion of knowledge is also a result of globalization of supply chains. - as companies transfer knowledge to new locations through subsidiaries, new pools of competencies will develop at those sites |
|
|
Tell me about one advantage of metanational innovation. Hint: cost What is a challenge associated with this? |
- Even if knowledge from overseas is similar to that available closer to home, the cost of utilizing the distant knowledge may be cheaper. EX: Software programmers in Bangalore rather than Silicon Valley. - These sites lack the full complement of necessary knowledge |
|
|
How do you achieve the benefits of metanational innovation? |
Prospect: find relevent pockets of knowledge from around the world Assess: decide on the optimal footprint for a particular innovation Mobilize: use cost effective mechanisms to move the distant knowledge without degrading it |
|
|
How can companies move these knowledge? |
Internet relocation of staff |
|
|
Tell me about prospecting |
- know what to look for - where to look for it - how to tap into it - Sheseido wanted to get into perfumery so it bought two exclusive beauty boutique chains in Paris to experience first-hand the demands of sophisticated customers. It also hired the marketing manager of YSL. |
|
|
Which organizational model is this? |
Decentralized federation: many key assets, responsibilities, and decisions are decentralized - Informal HQ sub relations overlaid with simple financial controls - Management regards operations as a portfolio of independent businesses |
|
|
Which organizational model is this/ |
Most strategic assets, resources and responsibilities and decisions are centralized - Tight central control of decisions, resources, and info - Management regards overseas operations as delivery pipelines to a unified global market - subsidiaries have limited freedom to create or even modify products - less understanding of local specificities |
|
|
Which organizational model is this? |
Parent retains considerable influence and control, but less than a global company - Products and technology is developed for the home market and extended to other countries with similar market characteristics, then diffused elsewhere - Formal management planning and control systems allow tighter HQ sub linkage - Management regards overseas operations as appendages to central domestic operation |
|
|
What does the choice of an organizational model depend on? |
Industry - consumer tastes - available technology - competitors behaviour - Government regulations - economics of production |
|
|
Characteristics of a transnational model? |
efficiency to achieve global competitiveness - local responsiveness to achieve flexibility - selective centralization: ---> some capabilities centralized at HQ for protection of core competencies --> some capabilities centralized at subsidiaries --> Some capabilities decentralized for local responsiveness - complex configuration of assets and capabilities - Network integration through strong interdependencies - Slack designed into production for flexibility - Systematic differentiation of roles and responsibilities - Management of multiple subsidiary roles is very important |
|
|
Whats a blackhole subsidiary? |
If the level of local resources and capabilities is low and the strategic importance of the local environment is low. |
|
|
Whats a Strategic leader subsidiary? |
If the level of local resources and capabilities is high and the strategic importance of the local environment is low. |
|
|
What is an implementer subsidiary? |
If the level of local resources and capabilities is low and the strategic importance of the local environment is low. |
|
|
What is a contributor subsidiary? |
If the level of local resources and capabilities is high and the strategic importance of the local environment is low. |
|
|
What are the 3 coordination mechanisms of global companies? |
Centralization Formalization Socialization |
|
|
Drawbacks of coordination by centralization? |
- Decision making system overload (HQ is in charge of everything; theres bureaucracy; cant respond in time) - Loss of sensitivity to local needs - Potential for strain and resentment |
|
|
Drawbacks of coordination by formalization? |
- Rigidity - control and enforcement costs can outwigh operational efficiency gains - Policies can become corporate dogma at the expense of customer needs - Managers cant be creative and innovative - high fixed costs of establishing the systems rules and policies |
|
|
Drawbacks of coordination by socialization? |
- expensive because it requires intensive indoctrination and training - decision making slower and ambiguous - |
|
|
What coordination mechanism goes with global structure? with multinational? with internationa? |
Centralization; socialization; formalization |
