Designing Effective International Organizations
“People will have to think Globally and predicate Leadership behavior not on power and authority but on Relationships and cooperation”
“The Global Organization must have Virtual System of Boundary-Spanning Relationships, thus creating “Soft-Side” Culture of interdependence and Innovation”
STRUCTURE FOR INTERNATIONAL ORGANIZATIONS
There is a fact that rarely can a firm extend its domestic structure into a global environment.
Also there is no ideal model that defines the optimal multinational organization.
Nevertheless, companies try to establish stable systems for management.
Our focus here will be on:
Patterns of decision-making authority
Processes of managing global resources
STRUCTURE FOR INTERNATIONAL ORGANIZATIONS cont.
Structural elements evolve as the nature of a firm’s international operations changes.
During the evolution, the authority structures and management systems change to fit new competitive strategies.
Structure follows strategy a company must forge an organizational structure consistent with its strategy to successfully implement plans through effective management systems.
However, managers can often develop an effective strategy more easily than they can alter an organizational structure.
“The inertia of prevailing management systems impedes change”
The Organization as a Global Network
Stanley Works, the world’s leading manufacturer of hand tools, operated primarily as an American exporter for more than a half-century. It served worldwide markets through a home-based export office, but intensifying competition from companies such as Black & Decker forced Stanley to establish overseas offices and eventually to group them under national and regional distribution centers. With greater expansion, Stanley found itself in so-called matrix structure that allowed for cross-management of products and markets.
The Organization as a Global Network cont.
As a result, Stanley, like many large, diversified multinationals, has
“The Global Organization must have Virtual System of Boundary-Spanning Relationships, thus creating “Soft-Side” Culture of interdependence and Innovation”
STRUCTURE FOR INTERNATIONAL ORGANIZATIONS
There is a fact that rarely can a firm extend its domestic structure into a global environment.
Also there is no ideal model that defines the optimal multinational organization.
Nevertheless, companies try to establish stable systems for management.
Our focus here will be on:
Patterns of decision-making authority
Processes of managing global resources
STRUCTURE FOR INTERNATIONAL ORGANIZATIONS cont.
Structural elements evolve as the nature of a firm’s international operations changes.
During the evolution, the authority structures and management systems change to fit new competitive strategies.
Structure follows strategy a company must forge an organizational structure consistent with its strategy to successfully implement plans through effective management systems.
However, managers can often develop an effective strategy more easily than they can alter an organizational structure.
“The inertia of prevailing management systems impedes change”
The Organization as a Global Network
Stanley Works, the world’s leading manufacturer of hand tools, operated primarily as an American exporter for more than a half-century. It served worldwide markets through a home-based export office, but intensifying competition from companies such as Black & Decker forced Stanley to establish overseas offices and eventually to group them under national and regional distribution centers. With greater expansion, Stanley found itself in so-called matrix structure that allowed for cross-management of products and markets.
The Organization as a Global Network cont.
As a result, Stanley, like many large, diversified multinationals, has