1. Sven is a senior vice president at a textile manufacturer that wants to move
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1. Sven is a senior vice president at a textile manufacturer that wants to move from being 20 percent globalized to 70 percent globalized in the next 10 years. What are some possible drawbacks that Sven's company must anticipate? a. Improved communication technology may lead to longer production cycles. b. None. All political and economic factors point to the rise of globalization. c. Rising wages may cancel out cost savings of access to low-cost input factors. d. Governments may lower barriers to international trade A planned emergence approach to strategic planning is most likely to be found in a highly centralized firm TRUE or FALSE Uptown Office Systems recently underwent reorganization. Based on customer feedback, the company eliminated many of its middle management positions and implemented a flatter structure. Which of the following is a possible drawback of this decision? a. The increased span of control for remaining managers may lead to higher levels of stress and possible 2. 3. burnout. b. Internal communications and decision-making processes will be slower Employees will be forced to take on more specialized roles and may become bored by repetitive tasks. d. c. Employees will have less power and autonomy, resulting in a loss of morale Which of the following types of groups is most susceptible to groupthink? a. 4. a heterogeneous group b. a cohesive group a diverse group d. c. a decentralized group 5. Island Home Goods pursues a related diversification strategy, deriving less than 70 percent of revenues from its original business unit, Island Furniture, and maintaining several related units including Island Lighting and Island Hardware. Which of the following structures is most likely to support this strategy? a. M-Form with decentralized decision-making power (competitive multidivisional) b. M-Form with centralized decision-making power (cooperative multidivisional) c. functional with centralized decision-making power d. functional with decentralized decision-making powerExplanation / Answer
1.c Rising wages may cancel out cost savings of access to low cost input factors
Organizations reap the benefits of cost savings when move into globalization of their firms i.e they get an opportunity to source the raw materials as well as the labour from low cost countries ,which positively impacts their bottomline.Now in the 10 years timeline,if the wages of the input(labor) raise substantially ,the textile manufacture's margings become thinner and thinner leading to lower cost savings and in extreme cases it may cancel out the cost savings.The cost arbitration model may longer work as expected.
2.False
A highly centralized firm has its own set of action and behaviour patterns and well developed mission and goals.Thus ,it is very unlikely that emergent strategy is found in these kind of organizations.
3.a The increased span of control for the remaining managers may lead to higher level of stress and possible burnout
Since the organization structure is flat ,the span of control has been increased i.e the ratio of employees to the managers is increased considerably.The remaining managers in the organization have to supervise and control performance of more employees than before.This would increase the managers' stress levels, thereby leading to demotivation and lack of interest in their jobs.
4.b cohesive group
Cohesive group is one where there is strong bond and unity between the group members.
Groupthink is a phenomenon where each group member tries to conform to the group's decision even though the decision in not correct.Thus groupthink possibility is high in cohesive group as these members do not want to lose their unity in decision making process and thus think alike.
5.b M-Form with centralized decision making power(cooperative multidivisional)
Since the company pursues a related diversification strategy ,the M-form structure best supports this strategy.All the units can work in cooperation with each other and share the core strengths thereby enhancing the economies of scope.However,the decision making should be centralized.
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