International company

from Wikipedia, the free encyclopedia

In the context of international management , an international company is a company that is economically active across national borders on a regular and non-negligible basis (strategic importance). This understanding of the term encompasses both larger and smaller companies. In addition, it differs essentially from the concept of the “ multinational company ” (MNE), which - by definition - is based on direct investments abroad (FDI). Multinational companies therefore form a subset of the international companies (INU). The term international company is broader to the effect that also companies that operate internationally without foreign direct investment on the basis of international cooperation agreements such as licensing and franchising or purely on the basis of extensive export activities. International companies arise through expansions in the form of external growth such as mergers and acquisitions or internal growth in the form of export, contractual cooperations or start-ups ( greenfield investments ) .

The above terminology used by international companies and multinational corporations should not be confused with that of Bartlett and Ghoshal . The four basic types of international corporations , multinational corporations , global corporations, and transnational corporations are all international corporations as defined above. The international company according to Bartlett and Ghoshal, on the other hand, is characterized by tailoring its activities to the home market and mainly working on international markets that are as similar as possible to their own.

classification

According to the competencies of internationally operating companies, the Harvard professors Sumantra Ghoshal and Christopher Bartlett divide them into three observable categories. Across industries they represent it within the groups common skills ( capabilities ) determines that its expression in the organizational structure found. The main features are summarized in the following table:

Multinational
company 		International
company 		Global
company
Essential competence Responsiveness Knowledge transfer Efficiency
Structures Loose Federated National Enterprises; national companies handle the entire operational business and parts of the strategic tasks Located between multinational and global companies, certain strategic departments are central, others are decentralized Firmly centralized companies, national companies primarily have distribution tasks; Strategy and most of the operational decisions at headquarters
Examples Unilever , ITT IBM , Ericsson Exxon , Toyota

Although many of the companies observed had grown to a significant size, all companies also showed weaknesses and problems. Obviously the adaptation to the environment was incomplete. From this observation, Goshal and Bartlett concluded a fourth form of internationalization, in which the three core competencies of multinational, global and international companies merge into one another. They called this form of transnational corporation because such a corporation would no longer have a center or a home country, but would be at home all over the world. Even if tendencies can be observed in many industries to achieve such a state, no company is yet known which could bear the attribute “transnational”.

Based on the two dimensions advantages of global standardization and the need for local adaptation , four basic strategies for international business activities result from the identified company types.

Need for local adaptation
Low High
Benefits
of global
standardization
zation		 High Global Transnational
Low International Multinational

See also

Individual evidence

  1. ↑ M. Kutschker, S. Schmid: International Management. 6th edition. Munich 2008, p. 251.
  2. ↑ a b K. N. Gosch: Differences in the interpretation and acceptance of globally binding rules within multinational companies - an investigation with a special focus on culture. Hamburg 2013, p. 118.
  3. ^ JH Dunning: Multinational Enterprises and the Global Economy. 2nd Edition. Wokingham et al. 1993, p. 3.
  4. ^ C. Bartlett, S. Ghoshal: Managing Across Borders: The Transnational Solution. Hutchinson, London 1989. Quoted in Susan Segal-Horn: International Strategy: Competing Across Borders. The Open University, 2002, ISBN 0-7492-9274-1 .
  5. ^ CA Bartlett, S. Ghoshal: Managing across Borders - The Transnational Solution. 2nd Edition. Boston 2002, p. 17.
  6. ^ C. Bartlett, S. Ghoshal: Managing across Borders: The Transnational Solution. Hutchinson, London 1989.
  7. ↑ CA Bartlett: Structure and Management of the Transnational Company - The New Organizational Challenge. In: ME Porter (Ed.): Global competition - strategies of the new internationalization. Wiesbaden 1989, pp. 425-464, here p. 438.
  8. ↑ KN Gosch: Differences in the interpretation and acceptance of globally binding rules within multinational companies - an investigation with a special focus on culture. Hamburg 2013, p. 123.