Chapter09_HodgettsRev

Chapter09_HodgettsRev - 1 PowerPoint slides by R. Dennis...

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1 PowerPoint slides by R. Dennis Middlemist, Professor of Management, Colorado State University
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Chapter 9 Entry Strategies and Organizational Structures 1. DESCRIBE how an MNC develops and implements entry strategies and ownership structures. 2. EXAMINE the major types of organizational structures used in handling international operations. 3. ANALYZE the advantages and disadvantages of each type of organizational structure, including the conditions that make one preferable to others. The specific objectives of this chapter are:
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Chapter 9 Entry Strategies and Organizational Structures 1. DESCRIBE the recent, nontraditional organizational arrangements coming out of mergers, joint ventures, keiretsus, and other new designs including electronic networks and product development structures. 2. EXPLAIN how organizational characteristics such as formalization, specialization, and centralization influence how the organization is structured and functions. The specific objectives of this chapter are:
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4 Entry Strategies and Ownership Structures DEVELOPED MARKETS % OF RESPONDENTS 0 20 40 60 80 100 North America Western Europe Japan Australia and New Zealand Adapted from Figure 9–1: Preferred Strategies for Global Expansion
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5 Entry Strategies and Ownership Structures % OF RESPONDENTS EMERGING MARKETS 0 20 40 60 80 100 Adapted from Figure 9–1: Preferred Strategies for Global Expansion
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6 Entry Strategies and Ownership Structures An overseas operation that is totally owned and controlled by an MNC MNC’s desire for total control and belief that managerial efficiency is better without outside partners Some host countries are concerned that the MNC will drive out local enterprises and others prohibit fully owned subsidiaries Home-country unions sometimes view foreign subsidiaries as an attempt to “export jobs” Today many multinationals opt for a merger, alliance, or joint venture rather than a fully owned subsidiary Wholly owned subsidiary
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7 Entry Strategies and Ownership Structures The cross-border purchase or exchange of equity involving two or more companies The strategic plan of merged companies often calls for each to contribute a series of strengths toward making the firm a highly competitive operation Mergers and Acquisitions
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8 Entry Strategies and Ownership Structures Alliance Any type of cooperative relationship among different firms. International joint venture (IJV) An agreement under which two or more partners from different countries own or control a business Nonequity venture Equity joint venture Advantages Improvement of efficiency Access to knowledge Political factors Collusion or restriction in competition Alliances and Joint Ventures
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9 Entry Strategies and Ownership Structures An agreement that allows one party to use an industrial property right in exchange for payment to the other party By licensing to a firm already there, the licensee may avoid entry costs
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Chapter09_HodgettsRev - 1 PowerPoint slides by R. Dennis...

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