To what extent and in what ways are the strategies of multinational companies influenced by the
To what extent, and in what ways, are the strategies of multinational companies influenced by the country of origin? “The world’s largest companies are in flux. New pressures have transformed the global competitive game, forcing these companies to rethink their traditional worldwide strategic approaches. ... Ghoshal and Bartlett identify three main forces on managers in MNC’s today that have caused this call for a change in their operation strategies. ... The companies responded by linking their international operations and transferring knowledge across them, hence, creating ‘world-wide innovation’. These forces on MNC’s strategies shaped the different organizational forms of MNC’s in different sectors from one period to another. ... During the 1920’s and up until the 1950’s, the time period that Ghoshal and Bartlett called the ‘multi-domestic’ era, dominated the multinational form. This was defined as “a collection of national companies to foreign markets which manage their local business within minimal direction from its headquarters. ... This was identified as “the strategy of a third group of companies is based primarily on transferring and adapting the parent company’s knowledge or expertise. ... The integration of international operations allows for economies of scale to be realized in this network and by that gaining, to a certain extent, global integration. ... ” The extent to which each group is able to achieve their aims is determined by the resources they have at hand, in other words, by power relations. ... So, to what extent, and in what ways, are the strategies of multinational companies influenced by the country of origin? ... Simply, it stems form various ways in which MNC’s are embedded in its home country, whether its the distribution of operations, concentration of ownership and fund raising, or the composition of the management board itself. ... Two types of empirical evidence have proven the MNC’s remain disproportionately influenced by their home country. ... Only 57 of the 100 companies have an index of greater than 50; a mere 16 have an index greater than 75. ... Hu also provides another method of evaluating the extent to which TNC’s are global. ... This systematic approach demands a deeper understanding of the way a multinational ‘country of origin’ is important in shaping the way it operates at the international level. ... ” On the other side of the argument lays the Japanese MNC’s strategies that are influenced by their domestic market in their “use of a high number of expatriates to oversee the adoption in their subsidiaries of some Japanese-style forms of work organization, such as team-based working” . The East Asian way of conducting business also shows the extent to which the strategies of MNC’s are influenced by their country of origin. ... Obviously, MNC’s are seen to be influenced greatly form their embeddedness in their country of origin, counter to the convergence hypothesis of hyperglobalists. ... To some extent, this paternalism has been carried over into the firm’s international operations particularly in Britain, where, unlike many American firms, the holding family allowed employees to decide whether to join a union or not.