chap04[1].ppt 191KB May 20 2010 09:29:46 PM

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Chapter 4

Computer Use in an International

Marketplace

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The Multinational

Corporation (MNC)

 Parent company and group of subsidiariesParent company and group of subsidiaries

 Operates acrossOperates across

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Each Subsidiary Has Its

Own

 GeographyGeography

 GoalsGoals

 PoliciesPolicies

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Special Need for

Information Processing in

an MNC

 Influenced by internal and external Influenced by internal and external

conditions

 Seeks to minimize environmental Seeks to minimize environmental

uncertainty

– _{Uncertainty - Difference between information}_{Uncertainty - Difference between information} required and

required and information possessedinformation possessed

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Types of MNC

Organizational Structure

Classifications

 Each structure requires its own information Each structure requires its own information

processor

 Worldwide functional divisionsWorldwide functional divisions

– Organized along functional lines_{Organized along functional lines}

– Marketing in subsidiary reports to marketing in parent _{Marketing in subsidiary reports to marketing in parent} company

company

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MNC Classifications (cont.)

 International regionsInternational regions

– _{International division separate from domestic}_{International division separate from domestic}

division

 Geographic regionsGeographic regions

– Each region responsible for its subsidiaries_{Each region responsible for its subsidiaries} – _{No communication between regions}_{No communication between regions}

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MNC Classifications (cont.)

 Worldwide product divisionsWorldwide product divisions

– _{Product division responsible for operations}_{Product division responsible for operations}

worldwide

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Need for Coordination in

an MNC

 Greater need than domestic companiesGreater need than domestic companies

 Companies unable to gain strategic control Companies unable to gain strategic control of their worldwide operations and manage

of their worldwide operations and manage

them in a globally coordinated manner will

not succeed in the emerging international

economy

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Need for Coordination

in an MNC (cont.)

 Improvements in information technology Improvements in information technology and methodology have made global

and methodology have made global

coordination somewhat easier

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Advantages of

Coordination

in an MNC

 Flexibility in responding to competitorsFlexibility in responding to competitors

 Ability to respond in one country to a Ability to respond in one country to a change in another

change in another

 Ability to keep abreast of market needs Ability to keep abreast of market needs around the world

around the world

 Ability to transfer knowledge between units Ability to transfer knowledge between units in different countries

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Advantages of

Coordination

in an MNC (cont.)

 Reduced overall costs of operationReduced overall costs of operation

 Increased efficiency and effectiveness in Increased efficiency and effectiveness in meeting customer needs

meeting customer needs

 Ability to achieve and maintain diversity in Ability to achieve and maintain diversity in firm’s products, their production, and

firm’s products, their production, and

distribution

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Global Business Strategies

 Multinational strategyMultinational strategy

 Global strategyGlobal strategy

 International strategyInternational strategy

 Transnational strategyTransnational strategy

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HQ

Tight controls; centrally driven strategy

One-way flows,

goods, information,

Global Strategy

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Assets, responsibilities decentralized

HQ HQ International

mentality Formal

control systems

International Strategy

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Transnational Strategy

Complex controls; high

coordination skills,coordinated strategic decision process

Heavy flows; materials, people

information, technology

Distributed capabilities, resources and decision

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Global Business Drivers

(GBD)

 Joint resourcesJoint resources

 Flexible operationsFlexible operations

 Rationalized operationsRationalized operations

 Risk reductionRisk reduction

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GBDs Cautions

 All GBDs do not apply to all MCNsAll GBDs do not apply to all MCNs

 Drivers have many influencesDrivers have many influences

– _Industry_Industry – _Country_Country

– _{Own characteristics}_{Own characteristics}

– _{Business units within firm}_{Business units within firm}

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Global Information

Systems (GISs)

Implementation Problems

 Politically imposed constraintsPolitically imposed constraints

– Hardware purchases and imports_{Hardware purchases and imports} – Data processing_{Data processing}

– _{Data communications}_{Data communications}

» Transborder data flows (TDF)_{Transborder data flows (TDF)}

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Global Information Systems

(GISs) Implementation

Problems (cont.)

 Technological problems_{Technological problems}

– Unreliable powerUnreliable power

– Slow telecommunicationsSlow telecommunications

– Software copyrights and blackmarket productsSoftware copyrights and blackmarket products

 Lack of support from subsidiary managers_{Lack of support from subsidiary managers}

– View corporate office as an ‘outsider’View corporate office as an ‘outsider’

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GIS Implementation

Strategies

 Multinational strategyMultinational strategy

– Development teams derived from subsidiaries_{Development teams derived from subsidiaries}

 Global strategyGlobal strategy

– _{Development teams derived from parent}_{Development teams derived from parent}

location

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GIC Implementation

Strategies (cont.)

 International

– Development teams can travel from parent to subsidiaries

 Transnational strategy

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Transnational

Strategy

 Link the GIS to business strategyLink the GIS to business strategy

 Define the information resourcesDefine the information resources

 Provide for data sharingProvide for data sharing

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Computing Around the

World

 Group Support Systems (GSS) in AfricaGroup Support Systems (GSS) in Africa

– Top management influences_{Top management influences} – Computing literacy_{Computing literacy}

– Referent power_{Referent power}

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Group Support Systems

(GSS)

 Systems that typically support problem Systems that typically support problem solvers meeting in groups settings

solvers meeting in groups settings

 Also called group decision support systems Also called group decision support systems (GDSS)

(GDSS)

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Factors Influencing

Acceptance of GSS

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-Computing Around the

Computing Around the

World (cont.)

 Strategic Decision Support System (SDS) in Strategic Decision Support System (SDS) in Switzerland

Switzerland

– _{SDS helps managers understand business}_{SDS helps managers understand business}

strategy and its implications

strategy and its implications – _{Tools and models}_{Tools and models}

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International Computer

Use in Perspective

 Great deal of attention given to GIS in past Great deal of attention given to GIS in past few years

few years

 GIS built on solid foundationGIS built on solid foundation

 Cultural differences can influence computer Cultural differences can influence computer work

work

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Summary

 MNC MNC

– _{Four organizational structures}_{Four organizational structures} – Coordination is the key_{Coordination is the key}

– _{Multitude of problems}_{Multitude of problems}

 GISGIS