Abstract
We provide empirical evidence regarding the effects of two organizational design parameters, divisionalization and centralization, on the media richness choices of CEOs of multinational enterprises in obtaining information from their foreign subsidiaries on strategic issues. In a sample of 86 U.S.-based multinational enterprises, formal divisional structure was found to affect CEOs' use of rich information channels for product matters but not for country matters, and centralization of decision making at corporate headquarters was found to affect their use of rich media for country issues but not for product issues. Relationships between organizational design and CEO information processing behavior, therefore, appear to be contingent on the type of strategic issue involved.
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