–In cell ...... the strategy of national responsiveness may require a decentralized organization structure.

–In cell......, it may be necessary to combine the advantages of both a centralized and decentralized organization structure.

Organizations that have decided to expand internationally do it in a number of ways

•When a company first begins international operations, it is typical for these activities to be extensions of domestic operations.

An arrangement in which domestic divisions are given worldwide responsibility for product groups

•If the firm produces a large number of diverse products, the structure allows each major product line to focus on the specific needs of its customers

•If the firm produces a large number of diverse products, the structure allows each major product line to focus on the specific needs of its customers.

•helps the organization establish and maintain the necessary link between the product development people and the customer

duplicating facilities and staff personnel within each division

•helps the organization establish and maintain the necessary link between the product development people and the customer

•duplicating facilities and staff personnel within each division

products that sell well are often given primary attention, while those that need special handling or promotion are often sidetracked

products that sell well are often given primary attention, while those that need special handling or promotion are often sidetracked

•There are six basic types of global structures: (1) global product, (2) global area, (3) global functional, (4) matrix, (5) mixed, and

•(6) transnational network.

An organizational arrangement in which all international operations are centralized in one division.

It reduces the CEO’s burden of direct operation of overseas subsidiaries and domestic operations

Advantages of:

•It raises the status of overseas operations to that of the domestic divisions.

Advantages of Coordination

Primary operational responsibility is delegated to area managers, each of whom is responsible for a specific geographic region

used by MNEs that are in mature businesses and have narrow product lines that are differentiated by geographic area

provides division managers with the autonomy to make rapid decisions that depend on local tastes and regulations

(global functional)

provides division managers with the autonomy to make rapid decisions that depend on local tastes and regulations

•difficult to coordinate geographically dispersed divisions into the overall strategic plan

(global area)

: difficult to coordinate geographically dispersed divisions into the overall strategic plan

expense associated with duplicating facilities

expense associated with duplicating facilities

(Global area structure)

allowing a small group of managers to maintain control over a wide-reaching organization, little duplication of facilities, and tight, centralized control

: difficulty in coordinating the production and marketing areas, since each operates independently of the other

(matrix)

•allowing a small group of managers to maintain control over a wide-reaching organization, little duplication of facilities, and tight, centralized control

difficulty in coordinating the production and marketing areas, since each operates independently of the other

An organizational arrangement that blends two organizational responsibilities such as functional and product structures or regional and product structures

•allows management to address more than one primary area of consideration

complexity of the design and the use of dual command

Matrix structure

•allows management to address more than one primary area of consideration

complexity of the design and the use of dual command

A hybrid organization design that combines structural arrangements in a way that best meets the needs of the enterprise

Mixed structure

•Designed to help MNEs take advantage of global economies of scales while also being responsive to local customer demands.

This structural design combines elements of functional, product, and geographic designs, while relying on a network arrangement to link the various worldwide subsidiaries

(Transnational network structure)

Three components of Transnational network structure

At the center of the transnational network structure are nodes, which are units charged with coordinating product, functional, and geographic information.

five key variables to determined importance of the structural

The structure is designed to answer the question: What is to be done?

The process of choosing from among alternatives.

The process of transferring meanings from sender to receiver

The process of determining that everything goes according to plan

Builds around the basic tasks of the organization. For example, in manufacturing firms, production, marketing, and finance are the three primary functions that must be carried out for the enterprise to survive