Dics Wk 8 414 - 1 What variables have to be considered in...

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1. What variables have to be considered in designing the organizational structure for international operations? 2. How do these variables interact, and which do you think are most important? 3. What is the role of information systems in the reporting process? 4. Discuss the statement, “Inadequate MIS systems in some foreign affiliates are a control problem for MNCs.” ntegrated Global Structures With further expansion, a firm may create an international division organized along functional, product, or geographic lines. In this case, foreign subsidiaries are organized under the international division, and subsidiary managers report to its head. In turn, the head reports to the CEO of the corporation. This structure allows managers to coordinate resources for foreign activities under one roof and thus, facilitates the beginning of a global strategy. Examples of companies with an international division are IBM and Pepsi. Their divisions are called IBM World Trade and Pepsi Cola International, respectively. There are three integrated global structures presented in this and the following slides. These structures allow companies to respond to increased product diversification and to maximize benefits from both domestic and foreign operations. The global functional structure is based around the organizational functions—e.g., production, marketing, finance—with foreign operations integrated into the activities of each function. This structure is primarily used by small firms with highly centralized systems and is appropriate for product lines using similar technolog y and for businesses with a narrow spectrum of customers. The result is plants that are highly integrated across products and that serve single or similar markets.
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