Understanding Mnc Typology

Topics: Multinational corporation, Globalization, Corporation Pages: 3 (763 words) Published: September 26, 2008

Understanding MNC Typology
Understanding MNC Typology
Knowing how distinguish the different types of typologies used by Multinational Corporations (MNCs) can allow leaders to predict the type of organization they are working with or leading. This knowledge can be useful to help a leader to be successful in their endeavors with any MNC that they may come in contact. This paper will define; briefly discuss the different types of typologies as well as their similarities and their differences. Typologies

Harzing (2000) mentions several different types of typologies when discussing MNCs. The first of these typologies is Polycentric. The Free Dictionary (2008) defines Polycentric as “having many centers, especially of authority or control.” Morris (2004), states that “foreign subsidiaries are given much more autonomy and managers are hired locally” (para In short, host-country nationals manage subsidiaries; parent company nationals hold key Headquarter positions. However, when discussing Polycentric within an MNC one would have to include the typology of Multidomestic according to Harzing (2000). The reason for this connection is that they are similar in how they employ the authority and decision making power within their loosely joined subsidiaries. Power (2006) defines Multidomestic as “a group of companies providing similar products and/or services to an identifiable set of customers or clients where competition is segmented from country to country. Competition in one country is independent from competition in other countries.” The main differences between these two typologies are in the way in which these organizations communicate between their subsidiaries. The next typology mentioned by Harzing (2000) is that of Geocentric. Geocentric is defined by Morris (2004) as a company that “takes a world view in terms of its operations and believes that each subsidiary makes a...
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