1. Post-Class Activity Why organizational issues for born-global firms differ from those for traditional multinational companies. Give examples of how technology can be utilized to support internal global communications systems. Discuss the conflicts that can arise between international headquarters and national subsidiaries. Global account management. Transnational network structure.

2. Internationalization and the Small Business Two models - Small business stage model: process of following incremental stages of internationalization - Global start-up or Born-global firm: company that begins as a multinational company 3. Born-Global Firms Key elements favoring global start-ups - Dispersed human resources - International sources of venture capital - The existence of a global demand - The lack of a geographically protected market - The necessity of worldwide sales to support the venture - The potential to avoid later resistance to internationalization 4. Traditional Internationalization and Born-Global Firms 5. Understanding Global Account Management Global Account Management(GAM) is the natural extension of national account management The worldwide operations of global customers are treated as one integrated account Consistent pricing, product specifications and service 6. Why MNC customers prefer GAM Centralized purchasing leads to more transparent price Consolidation of orders means Volume discounts Ability to manage product specifications and service more effectively 7. When is GAM appropriate? From a suppliers perspective, GAM is appropriate if : Products and services need global coordination and are profitable enough to justify it MNC customers want GAM These customers are important to the business Competitive advantage can be gained from GAM 8. Products and services Prime candidates are complex products and services like process controls, specialty chemicals and corporate banking High margin products Globally consistent or compatible Must meet complex specs across borders 9. Customers wants Customers may expect Suppliers to provide a single point of contact Coordinated resources for serving them Globally uniform / consistent prices/ discount schemes Globally standardised products and services Globally consistent service quality/ performance 10. Which customers are candidates for GAM? Good size and revenue potential Geographic spread Integration capabilities Existence of appropriate structure, processes and information systems Integration capabilities are high if Strategies are developed at the global level Most businesses have global P&L Country heads focus on servicing the activities of global business lines, functions and customers Global teams manage or coordinate most primary activities Information is captured and shared globally in real time A truly global culture permeates the organization 11. Transnational Network Structure The transnational network structure represents the newest solution to the complex demands of being locally responsive while taking advantage of global economies of scale and seeking location advantages such as global sources of knowledge It combines functional, product, and geographic subunits However, unlike the symmetrical matrix structure, the transnational has no basic form Instead, the transnational is a network that links different types of transnational subsidiaries throughout the world 12. Transnational Network Structures Transnational network structures A multinational structural arrangement that combines elements of function, product, and geographic designs, while relying on a network arrangement to link worldwide subsidiaries At the center of the transnational network structure are nodes, which are units charged with coordinating product, functional, and geographic information Different product line units and geographical area units have different structures depending on what is best for their particular operations 13. Transnational Corporation Involves linking foreign operations to each other and to headquarters in a flexible way Leverages local and central capabilities Not a matter of boxes on an organizational chart; it is a network of company units and a system of horizontal communication Requires the dispersal of responsibility and decision making to local subsidiaries Effectiveness is dependant on the ability and willingness to share current and new learning and technology across the network 14. Transnational Network Structures Dispersed subunits Subsidiaries that are located anywhere in the world where they can benefit the organization Specialized operations Activities carried out by subunits that focus on a particular product line, research area, or market area Designed to tap specialized expertise or other resources in the companys worldwide subsidiaries Interdependent relationships Share information and resources throughout the dispersed and specialized subunits 15. Transnational Network Structures 16. Choice of Organizational Form 17. E-com company