International-Business-Dr-R-Chandran-E-book

108
International Business- Dr. R. Chandran
products, in more than 120 countries. Procter and Gamble, based in
Cincinnati also has similar product lines and operates in more than 150
countries. Their logo, symbol, products and brands are easily identified in
the malls, outlets and media.
There are multinationals that have a total turnover exceeding the GDP
of many small or less developed nations. The Minnesota Mining and
Manufacturing Company, called for short, 3M, have more than a thousand
product lines. The top three multinationals in the world today could combine
to purchase a small nation. Few multinationals in the total employee force
that is larger than the population of a country and my even have the power to
bring down governments. Therefore, multinationals have money power,
muscle power, managerial power, technology power and political power
through which they influence many economies in the world.
At one time American based multinationals rules the world. Today,
many Japanese, Korean, European and Indian multinationals have spread
their wings in many parts of the world. Few nations have created specific
product based MNCs such as General Motors, Ford Motors and AMC in
case of U.S.A and Sony, Sharp, Hitachi and Casio incase of Japan.
Germany concentrated on technology based items like dental equipments
and telecommunications. From the centre they started moving to various
countries and established their empires.
The strategic nerve centre is the company’s headquarters, where major
decisions are taken and policies are formulated. The main roles of a typical
multinational at headquarters are:
1. Strategic role: It is a policy making entity for operations worldwide.
2. Execution: Decisions on implementation of policies, methods and means
of operations, in different countries.
3. Control: Since the operations are vast it is necessary to maintain control
over global strategic, costs, systems and operations.
All the three roles are played by the head quarters after completing major
five pre-requisites:
1. The business opportunity has been explored in a specific area.
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