Discuss the Management Problems Facing Multinational Companies and Companies with an International Dimension in Various Parts of the World

LIBRARY
OF THE

MASSACHUSETTS INSTITUTE
OF TECHNOLOGY

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MAR 23

1975

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WORKING PAPER
SLOAN SCHOOL OF MANAGEMENT
A FRAMEWORK FOR
STRATEGIC PLANNING
IN MULTINATIONAL CORPORATIONS

Peter Lo range*
Revised, January 1976

WP 821-75

MASSACHUSETTS
INSTITUTE OF TECHNOLOGY
50 MEMORIAL DRIVE
CAMBRIDGE, MASSACHUSETTS 02139

MAR 23
DtWEY

LiSlJARY

A FRAMEWORK FOR
STRATEGIC PLANNING
IN MULTINATIONAL CORPORATIONS

Peter Lorange*
Revised, January 1976

WP 821-75

Assistant Professor of Management Science, Sloan School of Management,
Massachusetts Institute of Technology.

A revised version of this paper will appear in the June 1976 issue of the Journal of Long Range Planning.

1976

M.I.T.

UBRARiES

MAR 2 3

1976
RECEIVED

Introduction

Strategic planning in a multinational corporation has a two-fold task: to identify the strategic options most relevant to the corporation

and to "narrow down" these options into the one best plan.

Stated this

way there is of course nothing fundamentally different between the strategic planning task of a multinational corporation and that of any other large corporation.

However, since multinationals offer several complex

and distinctively different approaches to organizational design and

planning, it is useful to examine some of the problems of strategic

planning in the context of the multinationals.
The broad definition of the strategic planning tasks given above has several implications.

In order to be able to identify the most

relevant strategic options, the corporation needs to adapt continuously to the environment.

Also, in order to narrow down the strategic options

into the one best plan, the corporation must be able to integrate its

many diverse activities.

In this article we shall attempt to clarify

the major purposes of planning in the multinationals in terms of