By- Akshay Gaur Diljot Singh Deepak Pandey

A Multinational Corporation is a corporation that manages production or delivers services in more than one country.
It extends employment contracts over national borders. MNCs are characterized by the use of hierarchical methods of interaction for organizing cross-national dependencies.

Horizontally Integrated MNC. Vertically Integrated MNC. Diversified Integrated MNC.

Subsidiaries in foreign countries.

Operations in number of countries. High proportion of assets / revenues in / from global operations.

Overseas operations should have manufacturing / R&D operations

Employees / Stakeholders should be from different countries.

Equity
Fullfillment-oriented culture Project-oriented culture

INCUBATOR Person Emphasis FAMILY

GUIDED MISSILE

Task Emphasis
EIFFEL TOWER

Power-oriented culture

Role-oriented culture

Hierarchy

 Domestic multiculturalism Multicultural and diverse workforce that operates in the

MNCs home country

Group multiculturalism Homogeneous groups Token groups Bicultural groups Multicultural groups

 Global parent strategy dictates plans. Limitations of growth due to regulatory / legislation / IPR

issues.

Limited Autonomy for top MNC Managers.

Sometimes bureaucratic setups have delayed decision making

sharp contrast to most Indian entrepreneur companies.

Insistence of some companies on having expats.

 Semantic Barriers. Unfamiliar culture and Ethics.

Host countrys Law and Order.

Host countrys economical conditions. Unfamiliar consumer taste.

 Rigidity and insistence on evaluating countries like any other market Not being able to recognize early enough that India is a price and

quality conscious market.

Limitations on M&A options.

Many MNCs have got consistently caught in rounds of parent

consolidation

Uneven foreingn Exchange rates.

Attitudinal problems May cause a lack of cohesion that results in the units inability to take concerted action or to be productive Perceptual problems When culturally diverse groups come together, they often bring preconceived, erroneous stereotypes with them Inaccurate biases. Inaccurate communication

MNCs have turned to emerging economies such as India, Indonesia, Brazil, China, and Mexico, as key locations for future growth.

Almost twenty years ago, Gunnar Hedlund (1986) launched the idea of the hypermodern MNC. It was at the time a radical and future-oriented interpretation of the changing nature of the multinational corporation, condensing modern developments in the global environment .

firms were expected to exhibit increasingly differentiated, fluid and egalitarian networks of internationally dispersed subsidiaries and affiliates. Heterarchical development of control. A heterarchical MNC will have no problem in entering joint ventures externalizing production and handling internal transactions.

The means of communication available to the individual will be vastly improved, leading to enhanced and intensified exposure to the international business environment. As foreign markets are deregulated there is great chance to enter foreign market.

To expand rapidly into international markets, the new species of multinationals make use of prior international connections and the international structures of established MNCs The newcomers and latecomers of the new species of multinationals have had to find innovative ways to make space for themselves in markets that were already crowded with very capable firms

firms found new ways to complement the strategies of the incumbents, such as through offering contract services, through licensing new technologies, or forming joint ventures and strategic alliances

Can enhance creativity, lead to better decisions, and result in more effective and productive performance Can prevent groupthink Social conformity and pressures on individual members of a group to conform and reach consensus Can be very effective team under right conditions Tasks requiring innovativeness Activities must be determined by the stage of team development

Due to these MNCs , competition increase and more employment opportunities are available& there will be reduction in inequalities