Multi-National Corporations

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Management

Prepared By:

                             

                                Hannah-Jean Dias       3374932

                                Insiya Lokhandwala    3531168

                                Papia Siddique            3540285

                                Emirhan Sanli             3382606

                                Huma Shahid              3538394

Submitted To:

Ms. Conchita Fonseca

Professor, College of Undergraduate Studies

University of Wollongong in Dubai

Date: 

2nd April 2009

Table of Contents

  1. Executive Summary
  2. Introduction
  3. Concept of Multi-National Corporations
  4. Issues and Challenges
  5. Multi-Domestic Corporation
  6. Issues and Challenges
  7. Global Company
  8. Issues and Challenges
  9. Transnational Company
  10. Issues and Challenges
  11. Born Globals
  12. Issues and Challenges
  13. Micro-National Corporations
  14. Issues and Challenges
  15. Perspectives in Multi-National Corporations
  16. Ethnocentric approach
  17. Polycentric approach
  18. Geocentric approach
  19. Regiocentric approach
  20. Global Strategy Viewpoint
  21. Real Life Examples
  22. Conclusion
  23. Reference List

   

1.0 Executive Summary

This report is written and compiled by Hannah-Jean Dias, Emirhan Sanli, Papia Siddique, Insiya Lokhandwala and Huma Shahid.  The report addresses the issues and challenges encountered by   Multi-National Corporations. Multi-national corporations are operated on the basis of different perspectives. The report elucidates the various perspectives which could be integrated by corporations. Moreover it exemplifies the different types of Multi-national corporations. Furthermore, it provides a description of real life issues faced by well known companies along with the managerial decisions taken by corporations to nullify the effect of their issues and deal with their challenges. Therefore this report has been written to alert the readers of the various possible issues which a multi-national corporation could face and the list of challenges with the various strategies innovative minds bring forward to control situations and prosper.

2.0 INTRODUCTION

A Multi-national Corporation is a corporation whose assets and facilities are found to be situated in at least one country other than the home country. These countries have offices or factories in different countries A Multi-national Corporation is therefore very large. The organization structure is essential for a Multi-national Corporation which is amended slightly on account of inflexible variations found in other countries. Additionally a Multi-national Corporation can adopt various perspectives like ethnocentric, regiocentric, polycentric and geocentric for its establishment. There are several types of Multi-national corporations such as Multidomestic Corporation, Global Company, Transnational, Born Globals and Micro-Multi Nationals. A multi-national corporation has a head office which is usually found in home countries which is centralized and is responsible for global management. A multi-national corporation cannot operate without a purpose. Managerial functions provide a direction to Multinational corporations to handle their purpose i.e. it allows accurate planning for attaining the goals, provides tips on organizing the knowledge, employees, ideas and  the wide range of work activities; which further suggests the strategies to be involved therein. Moreover managerial functions allocate the role of leadership amongst the leaders within the organization; providing them the various ideas and techniques they require in order to handle their subordinates. Furthermore managerial functions provide the idea of controlling the entire corporation. This elucidates that Multinational corporations are very important from the view point of Management as Management possesses a key role in its operation.

3.0 CONCEPT OF MULTINATIONAL CORPORATIONS

When a company wants to establish an organization, they have to decide which form of a global organization to run. This would include the Multinational Corporations (MNC), Multidomestic Corporation, Global Company, Transnational Corporation (TNC) and the Born Globals.  

The first type is the ‘Multinational Corporations’ (MNC) which is a large corporation which has different offices and operations in other countries and are coordinated and managed by the head office which is usually based in the home country (Robbins, 2005). This would be achieved sometimes through Joint Ventures and Strategic Alliances. On account of this some companies have found that it had been successful when establishing their company as a MNC. They had found an improvement with trade balance, decrease in unemployment and increasing demand for business service (Lowengart, 2001).Corporations such as Honda, Nike and Coca-Cola would be categorized as a Multinational Corporation.

4.0 ISSUES AND CHALLENGES

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The issues and challenges they mainly face would be regarding their association with the Third world countries. Even though they have had cooperation with the government of the host company with regards to capital inflow and improves the payment balances it would face problems with regard to price speculation, advantages with the exchange rates and allegations of bribery and corruption (Needle, 2004). These third world countries would be conquered by companies whose main aim was to maximize profit rather than help and assist with the countries economy and the social needs of the citizens (Leisinger, 2008).

5.0 Multidomestic ...

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