The document discusses different mentalities that multinational corporations can take when internationalizing, including international, multinational, global, and transnational mentalities. It provides examples of strategies used by companies that exemplify each mentality. The transnational mentality is described as recognizing the importance of both responsive local operations and an international dimension through an integrated network of worldwide operations. Effective transnational companies may locate different activities like factories, call centers, marketing, and R&D in different regions to achieve efficiency and flexibility globally.
> To define globalization and international business and show how they affect each other
> To understand why companies engage in international business and why international business growth has accelerated
> To discuss globalization’s future and the major criticisms of globalization
> To become familiar with different ways in which a company can accomplish its global objectives
> To apply social science disciplines to understanding the differences between international and domestic business
> To define globalization and international business and show how they affect each other
Concept of international business environmentPinki Verma
Presentation on Concept of International Business Environment which includes:
1. Difference between International Business and International Business Environment
2.Difference between Domestic Business and International Business
3.Entry Modes of International Business
4.Nature of International Business
5.Advantages of International Business
6.Classification Of International Business Environment
(a) Micro and Macro Environment
(b) Domestic, Foreign and Global Environment
7.Components Of International Business Environment with examples.
To watch more ppt follow our channel.
The world may continue to shrink in light of advanced technology, higher demands from markets and faster turnaround times, globalization has become a staple for world commerce and international business.
Introduction, DEFINITION OF INTERNATIONAL BUSINESS, Important, Why Companies Engage in International Business, Scope of International Business, Modes of entry into International Business, SPECIAL DIFFICULTIES IN INTERNATIONAL BUSINESS, BENEFITS OF INTERNATIONAL BUSINESS and Internationalization process and managerial implications.
> To define globalization and international business and show how they affect each other
> To understand why companies engage in international business and why international business growth has accelerated
> To discuss globalization’s future and the major criticisms of globalization
> To become familiar with different ways in which a company can accomplish its global objectives
> To apply social science disciplines to understanding the differences between international and domestic business
> To define globalization and international business and show how they affect each other
Concept of international business environmentPinki Verma
Presentation on Concept of International Business Environment which includes:
1. Difference between International Business and International Business Environment
2.Difference between Domestic Business and International Business
3.Entry Modes of International Business
4.Nature of International Business
5.Advantages of International Business
6.Classification Of International Business Environment
(a) Micro and Macro Environment
(b) Domestic, Foreign and Global Environment
7.Components Of International Business Environment with examples.
To watch more ppt follow our channel.
The world may continue to shrink in light of advanced technology, higher demands from markets and faster turnaround times, globalization has become a staple for world commerce and international business.
Introduction, DEFINITION OF INTERNATIONAL BUSINESS, Important, Why Companies Engage in International Business, Scope of International Business, Modes of entry into International Business, SPECIAL DIFFICULTIES IN INTERNATIONAL BUSINESS, BENEFITS OF INTERNATIONAL BUSINESS and Internationalization process and managerial implications.
BUSINESS IS DEFINED AS A SET OF ACTIVITIES RELATING TO INDUSTRY AND COMMERCE.
WHEN BUSINESS ACTIVITIES ARE CARRIED ACROSS THE POLITICAL BORDERS OF A COUNTRY, IT IS TERMED AS INTERNATIONAL BUSINESS.
A BUSINESS ENVIRONMENT INCLUDES VARIOUS EXTERNAL ACTORS AND FORCES THAT SURROUNDS A FIRM AND IMPACTS THE OUTCOME OF ITS DECISIONS AND OPERATIONS.
THE OBJECTIVE OF BOTH DOMESTIC BUSINESS AND INTERNATIONAL BUSINESS IS “MAKING PROFIT THROUGH CUSTOMERS SATISFACTION AND SOCIAL WELFARE”
TYPES OF BUSINESS ENVIRONMENT -
1. CONTROLLABLE ENVIRONMENT
a.) PRODUCTION
b.) FINANCE
c.) HUMAN RESOURCE
d.) MARKETING
2.UNCONTROLLABLE ENVIRONMENT -
a.) DOMESTIC ENVIRONMENT
b.) FOREIGN ENVIRONMENT
c.) GLOBAL ENVIRONMENT
ANOTHER MAJOR CLASSIFICATION -
1. MICRO ENVIRONMENT
2. MACRO ENVIRONMENT
RELEVANCE of international business environment
- Knowledge of international business environment is very important.
-Environment affects a firm’s strategic as well as tactical decisions so it becomes imperative for the firm to have in-depth knowledge of the various components of domestic, foreign and global environment.
01 Globalization and International BusinessBrent Weeks
To define globalization and international business and show how they affect each other
To understand why companies engage in international business and why international business growth has accelerated
To discuss globalization’s future and the major criticisms of globalization
To become familiar with different ways in which a company can accomplish its global objectives
To apply social science disciplines to understanding the differences between international and domestic business
Companies with long term and substantial interest in the foreign market normally establish wholly owned manufacturing facilities there. A number of factors like trade barriers, difference in the production and other costs encourage the establishment of production facilities in the foreign markets.
BUSINESS IS DEFINED AS A SET OF ACTIVITIES RELATING TO INDUSTRY AND COMMERCE.
WHEN BUSINESS ACTIVITIES ARE CARRIED ACROSS THE POLITICAL BORDERS OF A COUNTRY, IT IS TERMED AS INTERNATIONAL BUSINESS.
A BUSINESS ENVIRONMENT INCLUDES VARIOUS EXTERNAL ACTORS AND FORCES THAT SURROUNDS A FIRM AND IMPACTS THE OUTCOME OF ITS DECISIONS AND OPERATIONS.
THE OBJECTIVE OF BOTH DOMESTIC BUSINESS AND INTERNATIONAL BUSINESS IS “MAKING PROFIT THROUGH CUSTOMERS SATISFACTION AND SOCIAL WELFARE”
TYPES OF BUSINESS ENVIRONMENT -
1. CONTROLLABLE ENVIRONMENT
a.) PRODUCTION
b.) FINANCE
c.) HUMAN RESOURCE
d.) MARKETING
2.UNCONTROLLABLE ENVIRONMENT -
a.) DOMESTIC ENVIRONMENT
b.) FOREIGN ENVIRONMENT
c.) GLOBAL ENVIRONMENT
ANOTHER MAJOR CLASSIFICATION -
1. MICRO ENVIRONMENT
2. MACRO ENVIRONMENT
RELEVANCE of international business environment
- Knowledge of international business environment is very important.
-Environment affects a firm’s strategic as well as tactical decisions so it becomes imperative for the firm to have in-depth knowledge of the various components of domestic, foreign and global environment.
01 Globalization and International BusinessBrent Weeks
To define globalization and international business and show how they affect each other
To understand why companies engage in international business and why international business growth has accelerated
To discuss globalization’s future and the major criticisms of globalization
To become familiar with different ways in which a company can accomplish its global objectives
To apply social science disciplines to understanding the differences between international and domestic business
Companies with long term and substantial interest in the foreign market normally establish wholly owned manufacturing facilities there. A number of factors like trade barriers, difference in the production and other costs encourage the establishment of production facilities in the foreign markets.
International Business Actions Internationalisation T.docxmariuse18nolet
International Business: Actions
Internationalisation Theories and Practices (I)
Business College
School of Management
Key Questions
What approaches to global strategy do firms take?How do organisations internationalise? How does international business manage its internal operations globally? How does international business manage its external operations (e.g. relationship with the host country/communities)?
Key Learning ObjectiveThis session will help you to understand the concepts of:
1) Michael E. Porter’s Diamond Model
2) Global Strategy – Ghosal & Nohria Matrix
3) Born Global Concept
Michael E. Porter’s Diamond ModelPorter argues that nations can create factors that promote competitive advantage of nations as well as stronger level of FDI.
RMIT University
School of Management
*
School of Management
Examples of National competitive AdvantagesAbundant, low-cost labor in ChinaMass of IT workers in IndiaHuge reserves of bauxite in AustraliaAbundant agricultural land in the USAOil in Saudi Arabia
RMIT University
School of Management
*
School of Management
Michael E. Porter’s Diamond Model
RMIT University
School of Management
*
School of Management
Michael Porter’s Diamond Model:
Sources of National Competitive Advantage
Firm strategy, structure, and rivalry – the presence of strong competitors at home serves as a national competitive advantage
Factor conditions – labour, natural resources, capital, technology, entrepreneurship, and know how
Demand conditions at home – the strengths and sophistication of customer demand
Related and supporting industries – availability of clusters of suppliers and complementary firms with distinctive competences
RMIT University
School of Management
*
School of Management
*
Industrial ClustersA concentration of suppliers and supporting firms from the same industry located within the same geographic area
Examples include: the Silicon Valley, fashion cluster in northern Italy, pharma cluster in Switzerland, footwear industry in Pusan, South Korea, and the IT industry in Bangalore, India
Can serve as a nation’s export platform
RMIT University
School of Management
*
School of Management
National PolicyProactive economic development plan enacted by the government to nurture or support promising industries sectors. Typical initiatives:
Tax incentives
Investment incentives
Monetary and fiscal policies
Rigorous educational systems
Investment in national infrastructure
Strong legal and regulatory systems(Examples: Japan, Dubai, and Ireland)
RMIT University
School of Management
*
School of Management
Activity 1: Diamond ModelPlease discuss the concept of Porter’s diamond model and apply it to one industry in one country.
RMIT University
School of Management
*
School of Management
Bartlett and Ghoshal’s Model of Internationalization Strategy
RMIT University
School of Management
*
School of Management
Source: Adapted from Bartlett and Ghoshal (1991)., Managing Acrocc Border, Harvar.
International Business Strategy Material as per Bharathiar University Syllab...JisjissyChandran
Unit I;International Business,MNC,FDI
Unit II:International Finance,Economic Integration etc
Unit III:Human Resource Management Strategy etc
Unit IV:Corporate Strategy,Doing Business in Japan etc
Unit V:International Joint Venture, Challenges of International Business
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
The European Unemployment Puzzle: implications from population agingGRAPE
We study the link between the evolving age structure of the working population and unemployment. We build a large new Keynesian OLG model with a realistic age structure, labor market frictions, sticky prices, and aggregate shocks. Once calibrated to the European economy, we quantify the extent to which demographic changes over the last three decades have contributed to the decline of the unemployment rate. Our findings yield important implications for the future evolution of unemployment given the anticipated further aging of the working population in Europe. We also quantify the implications for optimal monetary policy: lowering inflation volatility becomes less costly in terms of GDP and unemployment volatility, which hints that optimal monetary policy may be more hawkish in an aging society. Finally, our results also propose a partial reversal of the European-US unemployment puzzle due to the fact that the share of young workers is expected to remain robust in the US.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
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how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
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1. Lecture – 1 MNC Mentalities and Responses to
Internationalization
Training Material:
-Textbook (181-192, 374-382).
-Chapter 1 from: Bartlett, C.A. & P.W. Beamish (2010):
Transnational Management. Singapore: McGraw-Hill.
-Video: “Hard Rock Café: Global Strategy” (6.14 min).
2. Think global, act local
The original phrase "Think Global, Act Local" first appeared
in the book "The Evolution of Cities" (1905) by Scots
Planner and was later applied by the social activist Patrick
Geddes.
Strategic moves are integrated and coordinated worldwide,
aiming at building a global brand name.
Global thinking and local response utilizes a common
strategic approach (low-cost, differentiation, focus), but
allows country-to-country customization to fit local market
conditions.
Marketing and distribution are adapted to fit local customs
and cultures
3. Glocalization: Think global, act local
« The term Glocal and the process of Glocalization are formed by
telescoping global and local to make a blend». The Oxford
Dictionary of New Words, 1991
Glocalization : The interpenetration of global and local, resulting
in unique outcomes in different geographic areas. George Ritzer
Refers to the development and selling of products or services
intended for the global market, but adapted to suit local culture
and behavior.
«Only truly global companies can achieve ‘global localisation’
that is, be as much of an insider as a local company but still
accomplish the benefits of world- scale operations». Kenichi
Ohmae
6. Bartlett & Ghoshal*: 4 mentalities
• International
• Multinational/Multi-domestic
• Global
• Transnational
Bartlett & Ghoshal indicate that there exists no ideal
mentality. A company may operate with anyone,
depending on its strategic position & culture,
localization pressures etc.
In fact, historically some MNCs (Toyota, Unilever) have steered
through most or all of these mentalities.
7. International Mentality
The company’s overseas operations are viewed by the HQ as distant
outposts whose main role is to support parent company. Subs are
viewed as “appendices”, operating under the same regulations in
diverse cultural domains.
Many local issues are treated at the local level, but product
development, branding, technology & knowledge are transferred to
the sub from the parent company (Bartlett & Beamish, 2010: 11-12).
Target countries are selected mostly according to their cultural
proximity to the home market.
Key managers of Subs come from the parent country and are
selected mostly upon their international experience and language
efficiency.
Of inferior effectiveness compared to the rest mentalities. No longer
efficient when strong competitors appear. By then, International
MNCs have to improve their cost structure by shifting to global
strategy.
Has been followed in the past mostly by US MNCs (Kraft, Pfizer,
P&G, GE). GE is famous (notorious ?) for insisting to fully assimilate
its acquisitions within the company culture and for imposing always
Americans on top. Despite a streak of acquisitions in Europe, CEO
Immelt was obliged to admit in as speech at HBS that “I think that
we stink in Europe today” (Ghemawat, 2007).
8. 8
Worldwide “International” Strategy
Coordinated Federation - Many key assets, responsibilities and
decisions localized except core
product design & brand
Administrative Control - Centralized HQ control, formal planning
and control, tight HQ-Sub linkage
International Mentality - Management sees overseas operations
as appendages to the domestic
operation
UK Chile
India
Japan
USA
HK
Mexico
From: Bartlett and Ghoshal, Managing
across borders, 1989
9. Multinational/Multi-domestic Mentality
Differences between national markets are addressed. The
corporation modifies its strategies, products, processes etc in
order to adapt to local contexts.
Company strategy is composed of the multiple, nationally-
oriented strategies of subs. Multi-domestic mentality is indicated
when economies of scale are not important, while coordination
costs between HQ and subs are high.
Subs at the local level may become highly independent,
assimilated to local companies of their host country. Sometimes
they act on their own interests rather than conforming to the
MNC strategy.
Multinational mentality is based more on marketing than on
manufacturing efficiency. Factories at the local level are built
more in order to overcome trade barriers, to establish a presence
near strategic resources, to improve marketing and to exploit
political relations, than to increase efficiency of production.
Products of the same company made in and addressed to third-
world countries are sometimes inferior to those produced in
developed countries (Bartlett & Beamish, 2010: 11-12).
10. Multinational/Multi-domestic Mentality (cont)
Autonomy of subs may come out of control. For example, in the
80s Unilever retained 17 country subs in Europe and it took more
than 4 years to oblige them to introduce a single new detergent
for Europe (Peng, 2010: 296).
Operation of independent subs is costly due to the duplication of
activities in many countries. Therefore, this strategy is more
appropriate in industries where pressures for cost reductions are
not significant (Peng, 2010: 296).
Followed mostly by European MNCs (ICI, Nestle, Unilever). Fiat
has followed this approach by establishing loosely controlled
manufacturing units in Yugoslavia, Spain, Poland etc. MTV in
Western Europe only retains more than 8 channels in different
languages.
11. 11
Multi-Domestic MNC
Decentralized Federation - Most key assets, responsibilities and
decisions localized
Personal Control - Informal HQ-Sub relationship, simple
financial controls
Multidomestic Mentality - Management sees overseas operations
as portfolio of independent
businesses
UK
Chile
India
Japan
USA
HK
Mexico
From: Bartlett and Ghoshal, Managing
across borders, 1989
12. Global Mentality
In order to retain value of their brand name, companies create
uniform products for the whole world market and produce them
in few highly efficient plants, often at the corporate center. Global
MNCs avoid costly country adaptation activities. Through strong
marketing support they attempt to reap maximum benefits
through economies of scale and scope.
Global strategy means that the whole world, not individual
national markets, is viewed as a unit of analysis. The underlying
assumption is that preferences of consumers become more and
more uniform. Therefore, a consistent marketing strategy dictates
that consumers be supplied with standardized products of
superior quality over the national varieties.
Already in 1983 professor Levitt had declared that the future
belongs to companies that make and sell “the same thing, the
same way, everywhere”*.
The global approach requires central coordination and control.
Manufacturing, R&D, and strategic decisions mostly take place at
the HQ (Bartlett & Beamish, 2010: 12-13).
13. Global Mentality (cont)
Followed mostly by Japanese MNCs (Canon, Komatsu,
Matsushita). Before attacking fully the global market, Toyota used
to follow this approach. For decades, its sales came almost
exclusively from direct exports. The precious Toyota Production
System (TPS) till recently was carefully nurtured within the
Japanese domain. Semiconductors.
Samsung has created a most efficient distribution system, but
production and R&D are firmly located in Korea.
This strategy is indicated when cost minimization is of cardinal
importance. Apparently it is inappropriate when market dictates
local responsiveness.
Many host governments have imposed restrictions to MNCs
(localist countervailing forces), often demanding dissemination of
knowledge and technology - China.
Volatility in currency markets (Asian crisis & Russian debt at the
end of 20th century, as well as the ongoing crisis in the Eurozone)
has occasionally obliged MNCs to review their global strategy.
14. 14
Global MNC
UK Chile
India
Japan
USA
Centralized Hub - Most strategic assets, resources, responsibilities
and decisions are centralized
Operational Control - Tight HQ control of decisions, resources,
information
Global Mentality - Management sees overseas operations as
delivery pipelines to a unified global market
HK
Mexico
From: Bartlett and Ghoshal, Managing
across borders, 1989
17. Transnational Mentality
Transnational mentality recognizes the importance of flexible and
responsive country-level operations (hence the term national in the
title). The international dimension, upon the condition that
competitive effectiveness is maintained, is also emphasized through
the prefix trans.
Key activities and resources are neither centralized nor entirely
decentralized as in the multinational mentality. Instead, they are
dispersed but organized in order to achieve at the same time
efficiency and flexibility. Dispersed resources are integrated into an
interdependent network of worldwide operations.
For example, a MNC may consider essential to establish factories for
labor-intensive products in low-wage countries (Vietnam, Mexico,
Guatemala).
On the other hand, call centers are likely to be located in low-cost
countries. If you call American Express, Sprint, Citibank, or IBM it is
likely your call will be answered in India.
Powerful marketing & sales divisions are likely to be founded in
populous countries of high buying potential (Brazil, China, India). In
order to compete Komatsu, Caterpillar was obliged to establish
production units near its most important customers. Production was
customized so as to comply with the host countries’ complex
legislation and safety codes.
18. Transnational Mentality (cont)
R&D activities are apt to be concentrated in highly developed
regions (Silicon Valley, Tokyo, Baden-Wurttemberg).
Sony relocated to London in order to improve access to financial
services.
HSBC has been called “the world’s local bank” for its ability to
respond to the needs of account holders in diverse nations.
The strategy of exploiting differences between developed and
peripheral markets has been called arbitrage by Prof. Ghemawat.
Transnational companies may trade-off activities at will. For
example, Dell opted to have its final assembly of computers
located in the USA (unlike most of its competitors and despite
higher labor costs) because its experienced technicians have a
better control of operations (Cullen, 2010: 42).
Many MNCs follow a hybrid of transnational strategy, by creating
more or less autonomous hubs in target countries. Hubs are
standalone units purported to serve a whole region both with
global products and locally adapted ones. E.g. Toyota in the 90s
started creating hubs, first in the USA, with outstanding results.
19. 19
Transnational
MNC
UK Chile
India
Japan
USA
Networked Organization - Distributed, specialized resources
and capabilities
Interdependent Units - Large flows of components, products,
resources, people, and information
Transnational Mentality - Complex process of coordination
and cooperation in an environment of
shared decision making
HK
Mexico
From: Bartlett and Ghoshal, Managing
across borders, 1989
21. Effective Transnationalization
o Barbie is 55 years old
o Sold in 130 countries
o National adaptations:
• Physical features
• Costumes
• Activity sets
o Standardized physique:
• Scaled to 6’2”, 110 lbs.
22. McDonald’s Transnational Menu
US Brazil Canada India Germany
Big Mac
French Fries
Coca-Cola
McNuggets
McAloo Tikki
McRib
McBier
McLobster
McCalebresa
PitaMac
McFarmer
23.
24.
25. .
20th century
Machine Bureaucracy
• Integrated
• Uniform
21st century
Networked Organization
• Disaggregated
• Specialized
Expanding the Boundaries of Business
26. 26
Worldwide Corporate-Level Strategy
Need for Local Responsiveness
Need
for
Global
Integration
Low
High
Low High
Global
strategy
Transnational
strategy
Multidomestic
strategy
Scale,
efficiency,
coordination
Customization
International
strategy
27.
28. INTERNATIONAL MULTINATIONAL GLOBAL TRANSNATIONAL
PROS *Simple organization
*Unbarred one-way
communication flow
*Facilitation of control
*Exploitation of local
economies
*Leverage of
headquarters
advantages
*Development of
executives at the
local level
*Fast response to
local market
demands
*Full exploitation
of local markets
*Indicated in
strong cultural
domains
*Exploitation of
know-how
*Facilitation of
control
*Effective global
planning
*Addresses a
single global
market through
superior products
*Commitment to
global objectives
*Worldwide utilization
of resources
*Internal transfer of
innovation and best
practices
*Customized products
for specific markets,
global for others
CONS *Insufficient feedback
from subsidiaries
*Few oppts for global
learning
*Ineffective international
planning
*Slow response to local
developments
*”Low-caliber”
subsidiaries
*Inferior compared to
the rest mentalities
*Lack of cohesion
and coordination
of subs
*Growth, R&D and
knowledge limited
at the local level
*Failure to exploit
experience at the
local level
*Lack of local
responsiveness
*Few oppts for
global learning
*Loss of market
share if
consumers shift to
local products
*Vulnerability to
local crises
*Implementation &
control problems,
org. complexity
*Risky trade-offs
between costs & local
responsiveness
*Excessive expenses
& time spent on
communication and
decision-making
31. 31
Pressures for Global Integration & Local Responsiveness
High
High
Low
Low
Global Integration
Local Responsiveness Pressures
Localization Pressures due to
Country Differences in
- consumer tastes/preferences
- infrastructure/practices
- distribution channels
- host government needs
Ball bearings,
wheat
Cosmetics, food,
household goods
Cost Reduction
Pressures
32.
33. 33
International presence of selected MNCs
1
32
52
59
65
96
37,031
29,378
1,540
8,279
2,165
917
Cell phones
Automobiles
Audio
equipment
Computers,
electronics
Online
auctions
Pizza
Finland
Germany
Japan
U.S.
U.S.
U.S.
Nokia
Audi
Clarion
Apple
eBay
Papa John’s
Sales in
domestic
market
Percent
Total sales
$ Millions
Products
Domestic
market
Company
Sales in
foreign
markets
Percent
99
68
48
41
35
4
34. 34
Sub Roles in the MNC
.
S:
High
Low
Low High
Strategic
importance
of
the
local
market
Resource base of the sub
•Black Hole •Strategic Leader
•Implementer •Contributor
35. Subs Roles in the MNC
Black Hole: A rather weak unit in terms of specialized resources,
but located in a strategically important market. Used by the
MNC to maintain presence in a key market in order to keep
abreast of new innovations or strategic moves by competitors.
However, it reflects an undesirable competitive position. In the
long run, the MNC may commit more resources , or may engage
in acquisitions or strategic alliances in order to access
complementary resources.
Implementer: Concern subs with weak specialized resources,
located in markets of lesser importance. However, they may
become part of the MNC’s overall success, because they may
generate a steady stream of cash flow, and may help build a
competitive advantage by contributing to company-wide scale
and scope economies.
Strategic Leader: The sub is of strategic importance, hence a
vital source of innovations and good practices that are spread
throughout the company. Aids HQ to identify strategic trends and
to develop core competencies.
Contributor: A highly competent sub, located in a less important
market. This type of sub has typically developed new FSAs, often
as the result of a competent host country management. Its
specialized resource base might benefit other units in the MNC if
HQ recognizes its potential.