International Strategic and Human Resource Management

1
International Strategic and Human Resource
Management

• Organizational Structures, and Management
  Decision and Control

Mark McKenna BUS 162, International and
Comparative Management San Jose State University
Chapters 9 and 11, Hodgetts, Luthans and Doh,
International Management Culture, Strategy and
Behavior , 6th edition (New York McGraw-Hill
Irwin, 2006) Adapted from PowerPoint slides by
R. Dennis Middlemist, Professor of Management,
Colorado State University
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Basic Organizational Structures

• International Division Structures
• A structural arrangement that handles all
  international operations out of a division
  created for this purpose
• Global Structures
• Product Division domestic divisions given
  worldwide responsibility for product groups
• Area Division global operations organized on a
  geographic rather than a product basis
• Functional Division organizes operations
  primarily on function and secondarily on product

3
Mixed Organization Structures and Transnational
Networks

• Mixed organization structures
• A structure that is a combination of a global
  product, area, or functional arrangement
• 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

See example next slide
4
Transnational Network Structures
Adapted from Figure 99 The Network Structure of
N.V. Philips
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Nontraditional Organizational Arrangements

• Organizational arrangements from mergers and
  acquisitions
• Organizational arrangements from joint ventures
  and strategic alliances
• Organizational arrangements from Keiretsus

6
The Electronic Network

• Forms
• Electronic freelancers Individuals who work on a
  project, usually via the Internet, and move when
  assignment done
• Temporary companies Individuals assigned for a
  particular, short-term purpose and then go on to
  other assignments
• Characteristics
• Services outsourcing function (delivered online)
• People in structure are temporary, contingent
  employees, and never see each other

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MNC Strategies and Organizational Structures
Aircraft Cameras Consumer electronics Computers
Telecommunications
Mixed or Transnational Network Structures
Aerospace
Transnational strategy
Global strategy
Global Product or Functional Division
Automobiles
Pressure for globalization
Synthetic fibers
Steel
International Division Structures
International Strategy
Clothing
Global Area Division
Multi-domestic strategy
Cement
Packaged goods
Pressure for local responsiveness
Adapted from Figure 92 Organizational
Consequences of Internationalization
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Control Mechanisms and Organizational
Characteristics

• Formalization
• The use of defined structures and systems in
  decision making, etc
• Specialization
• Assigning individuals to specific, well-defined
  tasks
• Centralization/Decentralization
• Locus of decision making (at the top or by
  operational managers and front-line workers)

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Control Mechanisms and Organizational Structures
Adapted from Table 9-2 Control Mechanisms Used
in Select Multinational Organization Structures
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Decision and Control Linkages

• Decision Making
• The process of choosing a course of action among
  alternatives.
• Controlling
• The process of evaluating results in relation to
  plans or objectives and deciding what action, if
  any, to take.
• Management Decision and Control
• The choice of a course of action among
  alternatives and the evaluation of results of
  those choices in relation to plans or objectives.

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Decision Making in Subsidiary Operations
Adapted from Table 111 Factors That Influence
Centralization or Decentralization of Decision
Making in Subsidiary Operations
12
Internal and External-Oriented Cultures
Adapted from Table 113 The Impact of Internal
and External-Oriented Cultures on the Control
Process
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Seven Common Themes of Successful MNCs

• Top managers take their mission statements
  seriously and expect everyone else to do the same
• Success attracts the best people and the best
  people sustain success
• The top companies know precisely what they are
  looking for
• These firms see career development as an
  investment not a chore
• These companies promote from within whenever
  possible
• Performance is rewarded
• The firms are genuinely interested in what their
  employees think and measure work satisfaction
  often and thoroughly