Setting Your Organizational Boundary

The video tutorial explains organizational boundaries through three approaches: control and equity. The control approach is divided into operational and financial control. Operational control involves authority over activities within a leased space, while financial control pertains to directing financial policies. The equity share approach considers economic interest, where ownership percentage determines responsibility for greenhouse gas emissions.

What are the two main components of the control approach in defining organizational boundaries?

• Operational and Equity

• Financial and Economic

• Equity and Financial

• Operational and Financial

Which of the following best describes operational control?

• Having authority over operational activities in a leased space

• Owning the majority of shares in a company

• Directing financial policies of an organization

• Having a minority stake in a joint venture

In the context of operational control, what activities might you be responsible for in a leased building?

• Managing joint ventures

• Turning on and off lights and water faucets

• Owning the building

• Setting financial policies

What does financial control allow an organization to do?

• Share economic interest with partners

• Control only operational activities

• Lease operational spaces

• Direct financial and operating policies

How is the equity share approach determined in a joint venture?

• By the operational control of the partner

• By the financial policies set by the landlord

• By the percentage of economic interest owned

• By the number of employees in the organization