Multinational Compaines

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introduction to business

MULTINATIONAL COMPANIES (MNC’s)

Submitted to:

MISS NASEEM BUKHARI
Submitted By:

AYESHA RAHIM FAROOQI 043
TEHREEM FATIMA 048
RIDA ASHRAF 001
FATIMA FARHEEN 036
NAREET HASSAN 041
ZAHRA ALI 028

Session:

BBA 2010-2014 MORNING

Table of Contents
MULTINATIONAL COMPANIES1
Definition:1
Introduction:1
Ownership criterion:2
Nationality mix of headquarter managers:2
History2
Three Stages of Evolution5
1. Export stage:5
2. Foreign Production Stage:5
3. Multinational Stage:6
MERITS6
BENEFITS OF INTEGRATION6
ECONOMIES OF SCALE7
ECONOMIES OF EXPERIENCE7
ECONOMIES OF LOCATION7
PRODUCT DIFFERENTIATION7
TECHNOLOGY8
ACCESS TO CAPITAL8
Demerits9
MNC STRATEGIES11
According to Howard Perlmutter (1969)11
According to Franklin Root (1994),11
`Introduction to international strategy11
Global efficiencies of multinational companies:14
Location efficiency14
Economies of scale14
Economies of scope14
International flexibility15
Worldwide learning15
Possible problems in multinational companies15
Strategic exploration15
Home replication strategy16
Multi-domestic strategy16
COMPONENTS OF MULTINATIONAL STRATEGY18
Distinctive competence18
Resource deployment18
Scope of operations18
Synergy19
Development an international strategy19
Mission statement19
ANALYTICAL OVERVIEW20
ETHICAL BEHAVIOUR OF MULTINATIONAL COMPANIES IN HOST COUNTRIES20
Disadvantage to host20
Advantage to home20
Disadvantage to host20
Advantage to home and disadvantage to host20
Disadvantage to host20
International power21
Tax competition:21
Market withdrawal:22
Lobbying23
Patents:23
Transnational Corporations23
Does MNCs Doing Good To Our Country?25
MNCs in developing country26
THE FUTURE FOR MULTINATIONAL CORPORATIONS27
Bibliography…………………………………………………………………………………….29

MULTINATIONAL COMPANIES
Definition:
A multinational corporation (MNC) or enterprise (MNE) is a corporation or an enterprise that manages production or delivers services in more than one country. In other words if a country operates in more than one country it is called multinational company

The International Labor Organization (ILO) has defined MNC as a corporation that has its management headquarters in one country, known as the home country, and operates in several other countries, known as host countries. In other words, Multinational Corporation is a business enterprise with manufacturing, sales, or service subsidiaries in one or more foreign countries and it is also known as a transnational or international corporation. Introduction:

In more recent times, multinational corporations have grown in power and visibility, but have come to be viewed more ambivalently by both governments and consumers worldwide. Indeed, multinationals today are viewed with increased suspicion given their perceived lack of concern for the economic well-being of particular geographic regions and the public impression that multinationals are gaining power in relation to national government agencies, international trade federations and organizations, and local, national, and international labor organizations. Despite such concerns, multinational corporations appear poised to expand their power and influence as barriers to international trade continue to be removed. Furthermore, the actual nature and methods of multinationals are in large measure misunderstood by the public, and their long-term influence is likely to be less sinister than imagined. Multinational corporations share many common traits, including the methods they use to penetrate new markets, the manner in which their...
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