Organizing for Worldwide Effectiveness: This article discusses how companies across the globe are trying to overcome the hurdles related with the overall global economy. Different corporate strategies do in fact have different tradeoffs. Responding only to the needs of a local community/culture suggest that companies cannot sell the same product globally. Companies that sell the same product globally, however, suggest their incapability to respond to their local environments. With this being said, the main takeaway from this article is that the most effective and successful worldwide corporations use a transnational organization for long-term sustainability. Transnational organizations strategically merge a centralized and decentralized structure together.
• Matsushita - demonstrates a centralized organization. They manage this style through Multiple Linkages, Market Mechanisms, and Personnel Flows
• Philips – demonstrates a decentralized organizational structure. They manage this style through a Dispersion of Responsibilities/Decentralized Assets, a Cadre of Entrepreneurial Expats, and a Tight Functional Integration.
Tap Your Subsidiaries: The article uses two assumptions/theories known as the U.N Model and the Headquarters Hierarchy. P&G had a clash between both theories where they used a manager for the Europe strategy. Even though the Euro strategy was very successful, the effect was disadvantageous with regard to their international capacity. The main takeaway from this article is that companies need to work harmoniously through cooperative and accommodating efforts. The article also discussed the different roles for national subsidiaries which include:
• Strategic Leader - played by a proficient national subsidiary strategically located in an important market.
• Contributor - a subsidiary in a small market but with a unique capability.
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