Organizational Structure of Multinational Entities

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Organizational Structure of Multinational Entities:

Organizational Structure of Multinational Entities Bradley A. Erdbruegger Saint Louis University

Structure of Successful Multinationals:

Structure of Successful Multinationals In 2009, Mina Kimes wrote an article about the organizational structure of top performing organizations in Fortune Magazine One thing that successful organizations don’t have in common is organizational structure Top organization generally do not change organizational structure While organizational structure is steady, these organizations emphasize flexibility This allows organizations to adapt to changing environments

Globalization & Location of Decision Rights:

Globalization & Location of Decision Rights Gibbs et. al in 2012 discusses globalization Globalization has caused increase complexity within organizations This increased complexity leads to increased competition Gibbs suggests that organizations consider relocating to emerging markets in order to beat the competition to the market place Robinson & Stocken’s 2013 discussed decision rights between parent and subsidiary companies The location of decision rights needs to be matched with the firms industry and local einvornments

Dual Attachment:

Dual Attachment In Vora et. al’s 2005 study they investigated dual attachment Dual attachment is when managers are committed to bot the parent and subsidiary organizations Dual attachment is associated with increased job performance, retention, and fulfillment of organizational goals

Structures Multinationals Take:

Structures Multinationals Take Multi-domestic Global Transnational There is no “correct” structure Organizations must match the industry, environment, and organizational goals to the structure that makes most sense

Knowledge Creation & Transfer:

Knowledge Creation & Transfer Lupton & Beamish’s 2014 study discusses the role organizations play in knowledge creation and transfer Organizations play both a direct and indirect role in knowledge creation & transfer Direct - structures created in order to support the creations & transfer of best practices Indirect – organizational structure

OD Consultant Tool – Dual Attachment Survey:

OD Consultant Tool – Dual Attachment Survey Survey sent to managers at both parent and subsidiary level Survey ask questions to gauge how managers feel connected to both the parent a subsidiary This survey helps gauge how organizations are encouraging dual attachment and if organizations need to improve

OD Consultant Tool – Best Practices Survey:

OD Consultant Tool – Best Practices Survey Survey sent to similar functions across every region Survey asks about how function perform certain actions Ultimately organizations should attempt to discuss the results with the relevant employees of each region During these discussions a best practice can be determined Also, regions can establish why their region needs a different practice

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