Final Project: Part 2
Due: 4 December 2012
Sony Corporation: Globalization Meets Localization
What is a transnational corporation? Select any one and present a short essay on what the company produces, where are the facilities located, and refer to aspects of capital, labor, and markets of its final product.
A transnational corporation is a nationally based company that manages production units or provides service in two or more countries. They are corporations that make decisions from a global prospective rather than one centralized headquarters. Typically the corporation will have its headquarters in one country, while it operates in one or more other countries. Sony is a Japanese transnational corporation headquartered in Tokyo, Japan. It is one of the leading manufacturers of electronic products for the consumer and professional markets. Sony provides worldwide service and has over 162,000 employers globally. This paper will explore the production of Sony and how the location of its facilities affects the corporation’s capital, labor, and markets of product.
Transnational corporations are nationally based companies that manage production units or provide service in two or more countries. They are corporations that make decisions from a global prospective rather than one centralized headquarters. The first transnational corporation was the Dutch East India Company, which was founded in 1602 and developed trade links for prized commodities such as pepper between Arabia, India, China, the Dutch East Indies, and Japan. (Rodrigue, 2012) Since then, they have become the most powerful economic and political forces in the world today including several corporations that have budgets larger than many countries in the world. In fact, as of 2002, 51 of the top 100 global economies were transnational corporations. (Anderson & Cavanagh, 2002) Transnational corporations have had a powerful impact on international relations, as well as local economies. They have a huge role in globalization. These corporations hold ninety percent of all technology patents worldwide and are involved in seventy percent of global trade. (Dunning, 1992) More and more of these corporations have continued to develop. What started with 7,000 TNC’s in 1970, jumped to 40,000 by 1995. Today there are over 60,000 transnational corporations worldwide; more than half of which come from only 5 nations: The United States of America, France, Germany, the Netherlands and Japan. (Ward, 2003)
I thought that it would be interesting to research a transnational corporation that originated in a country other than the United States. Therefore, the company that I will be addressing in this paper was founded in Japan: Sony Corporation. This particular TNC is called a Transnational Media Corporation meaning that its primary product is information and entertainment. I wanted to choose a corporation from outside of the United States, but that was still popular and had strong presence here. Many transnational corporations tend to focus more on their homeland corporations and show less concern for factories overseas. (Dunning, 1992) I chose Sony because I was interested in finding out if the decisions made by Sony officials were primarily for the benefit of Japan, or if these decisions were made in the interest of all of their global consumers. Sony originated in September of 1945 during the aftermath of World War II. Japan was under reconstruction and there was a high demand for news and information. This new increase in demand inspired a man by the name of Masaru Ibuka to create a radio repair shop so that people in need of communication from the government could have the equipment to do so. (Gurshun & Kanayama, 2002) The following year Ibuka and his friend Akio Morita formed a company called Tokyo Telecommunications Engineering Corporation. The company built Japan’s first ever tape recorder, which they named...