Multinational Strategy

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Multinational Strategy

Benefits of strategies that extends to several countries

• Scale and replication

Example: McDonald’s menus are local, but leverage global brand and processes

• Global customers
Example: Medical imaging devices from GE, Siemens, Philips

• Natural resources and sourcing

Example: Engineers based in India for TCS, Cognizant, IBM

• Learning best practices

Example: IKEA has adapted to varied DIY cultures, such as in Japan
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Multinational Strategy

Dimensions of national culture (Hofstede)

1. Power Distance

2. Individualism vs Collectivism

3. Masculinity vs Femininity

4. Uncertainty Avoidance

5. Long Term vs Short Term

6. Indulgence vs Restraint
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Multinational Corporations

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Multinational Corporations
There are various kinds of corporate structures (Bartlett and Ghoshal)

High
Global Transnational

Example: Pfizer Example: Unilever

Global
Integration

International Multi-domestic

Example: UPS Example: Nestle

Low
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Low Local Responsiveness High
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Multinational Corporation

Types of managers (Bartlett and Ghoshal)

Business Manager
Strategist + Architect + Coordinator

Country Manager
Sensor + Builder + Contributor

Functional Manager
Scanner + Cross-pollinator + Champion

Corporate Manager
Leader + Talent Scout + Developer
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Summary

• Internationalization is a process by which an industry becomes global

• There are many business benefits of a global strategy, but also cultural risks

• A multinational corporation can be organized in various ways with different managerial responsibilties

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 Thank You

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