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Global Organizational Structures

In: Business and Management

Submitted By freedom10
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Global Organizational Structures

MGT/230
October 29, 2013
Richardson

Global Organizational Structures

This paper will define the different types of global organizational structures. It will also evaluate how global organizations function in regards to such functions as marketing, finance, human resource, and operations. It will also take a look at and explain how organizational design such as geographic, customer based, product service, marketing channels and departmentalizing helps determine which structure best suits a particular organization. In the international model the organization uses its existing core capabilities to expand into foreign markets. This is used best when there are fewer pressures for local responsiveness. This model uses subsidiaries in each country for which the company wants to do business in. In this global business model the main control is exercised by the parent company that is located usually in the country of origin of the product. This business model may allow for some subsidiaries to adapt products to local conditions but they must first clear the changes through the main entity or corporation first. Because of this set up there is a major dependency of the subsidiaries on the main company. New products, processes, and ideas require a great deal of coordination and control by the parent company. Some of the advantages of this business model is that it may facilitate the transfer of skills and knowledge from the parent company to the subsidiaries around the world. A major disadvantage of this model is that it does not provide a lot of latitude for responding to local conditions. Also it does not provide the ability to buy locally for a cut rate without the parent company approval which could be a purchase of a time sensitive commodity.
The Multinational business model also known as the multidomestic

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