International business environment and operations 13e pearson chapter 15

International Business Environments and Operations, 13/ e Part 5 Global Strategy, Structure, and... Chapter 15The Organization of International Business... Chapter Objectives• Profile t

International Business Environments and Operations, 13/

e

Part 5 Global Strategy, Structure, and

Chapter 15

The Organization

of International Business

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

Organizing Operations

Organizing is the process of creating

the structure, systems, and culture

needed to implement the company’s

strategy.

Factors Affecting Organizing

Operations

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

Organization Structure

Structure: formal arrangement of jobs within a company that specifies roles, responsibilities,

and relationships

• Vertical Differentiation

• Horizontal Differentiation

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

Horizontal Differentiation

• Functional Structure

– Advantages and Disadvantages

• Divisional Structure

– International Division

– Product Division

– Geographic Division

• Matrix Structure

Contemporary Structures

• Network Structure

• Virtual Organization

• Pitfalls of Contemporary Structures

Coordination and Control Systems

• Approaches to Coordination:

– Standardization

– Plan

– Mutual Adjustment

• Control Methods:

– Market

Control Tools

• Reports

• Visits to Subsidiaries

• Cost and Accounting Comparisons

• Evaluative Metrics

• Information Systems

Organization Culture

• The Importance of Culture

– Culture and Values

– Culture and the Value Chain

• Challenges and Pitfalls

• Organization Culture and Strategy

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

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