Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-1 International Business Environments and Operations Part 5 Global Strategy, Structure, and Implementation

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-2 Chapter 15 The Organization of International Business

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-3 Chapter Objectives Profile the evolving understanding of organizing a company for international business Describe the antecedents and features of traditional structures Describe the antecedents and features of contemporary structures Study the systems used to coordinate and control international activities Profile the role and characteristics of organization culture Link the ideas of strategy and organization in the international company

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-4 Organizing Operations Organizing is the process of creating the structure, systems, and culture needed to implement the company’s strategy.

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-5 Factors Affecting Organizing Operations

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-6 Change: The Critical Factor Changes in the market environment and nature of work push managers to rethink how they organize their workplace. Trends inducing change: –Expansion of International Business –Importance of Knowledge as a Competitive Advantage –The Internet as a Design Standard –Workplace Adjustments –Managerial Adjustments –Changing Social Contract –Global Credit Crunch and Rising Unemployment

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-7 Organization Structure Structure: formal arrangement of jobs within a company that specifies roles, responsibilities, and relationships Vertical Differentiation Horizontal Differentiation

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-8 Vertical Differentiation Centralization versus Decentralization in Organizational Design –Centralization: degree to which high-level managers make strategic decisions and delegate them to lower levels for implementation. –Decentralization: degree to which lower- level managers make and implement strategic decisions.

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall 15-9 Horizontal Differentiation Functional Structure –Advantages and Disadvantages Divisional Structure –International Division –Product Division –Geographic Division Matrix Structure –Unity of Command Principle Mixed Structure

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall Contemporary Structures Network Structure Virtual Organization Pitfalls of Contemporary Structures

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall Coordination and Control Systems Approaches to Coordination: –Standardization –Plan –Mutual Adjustment Control Methods: –Market –Bureaucratic –Clan

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall Control Tools Reports Visits to Subsidiaries Cost and Accounting Comparisons Evaluative Metrics Information Systems

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall Organization Culture The Importance of Culture –Culture and Values –Culture and the Value Chain Challenges and Pitfalls Organization Culture and Strategy

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall Future: The Role and Rise of Corporate Universities Managers believe companies must purposefully develop shared values Worldwide, more than 1,000 new corporate universities have begun operations Corporate universities—physical and virtual institutions that: –Lead training efforts –Facilitate learning –Help upgrade competencies –While advocating the philosophical ideals of the company’s culture

Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.