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Role of Multinational Corporations in the modern world

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An expatriate, on international business travel most of the times, arrives on the British Air Way’s flight, rents a Toyota at Hertz, drives down-town to Hilton hotels and reaches the room, flips on to Sony TV and catches the glimpse of the same flashing signs of ‘Coca-Cola’ and ‘BMW’ etc. Then suddenly while watching the news on BBC a sense of disorientation sets in and they try to remember where they are Sydney, Singapore, Stockholm or Seattle? This has become a common experience, thanks to the MNC phenomenon. Multinational Corporations (MNC) account for 40% of the worlds manufacturing output and almost a quarter of the world trade. About 85% of the world’s automobiles, 70% of computer, 35% of toothpaste and 65% of soft drinks are produced and marketed by MNCs (Bartlett et al, 2003, p3).


However, most of the MNCs have come up in recent times of change and globalisation. It is evident in the changed definition of MNC i.e. till 1973 the United Nations defined MNC as an enterprise which controls assets, factories, mines, sales offices and the like in two or more countries (Bartlett et al, 2003). However, the scope of what the term Multinational Corporation covers has changed and required two crucial qualifications vis--vis first qualification requires an MNC to have substantial direct investment in foreign counties and not just an export business. While the second requisite for a true MNC would be a company engaged in the active management of these offshore assets rather than simply holding them in a passive financial portfolio (Bartlett et al, 2003).


One of the most important motivations for companies to expand their operation internationally is the low-cost factors of production in developing countries like China and India (, 2006). This has had a tremendous influence on the economies of the developing countries, acting as a catalyst in their growth process. However, entering a new market in a different nation is not as easy as it sounds, with factors like local culture and local market knowledge presenting as obstacle initially. There are various ways in which a company can decide to enter the market, one such model being the Uppsala model, which suggests a company should make an initial commitment of resources to the foreign market through which it gains the local market know-how on the basis of which further evaluations can be made (Bartlett et al, 2003). However, there are many companies who do not follow such models and take a short cut to building the market knowledge by investing in or acquiring a local partner for instance Wal-Mart entered the UK by buying the supermarket chain Asda (, 2006).


However, in recent times most companies have recognised the need to be responsive to local markets and political needs and the management styles followed by multinationals are gradually shifting towards a trans-national strategy of ‘Think global, act local’.




Bartlett, C. et al. (2003). ‘Transnational Management’. 4th Ed. McGraw-Hill, London.


Papers For You (2006) "C/B/311. Multinational Enterprises (MNEs) in Developing Countries ", Available from [17/06/2006]


Papers For You (2004) " P/B/220. Is it true to say that many U.S. multinational enterprises (MNEs) are more economically and politically powerful than some nation states? Does this scenario best explain America's rise to globalism and the real power behind the White House today?", Available from [18/06/2006]

E/B/313. Control strategies of Multinational Enterprise

C/B/677. Multinational companies may face particular issues in managing expatriates. Critically evaluate some of the main research in this area.

C/B/673. You cannot have MNCs without Globalisation, by the same token, you cannot have Globalisation without MNCs. Discuss this Statement and its Implications for HRM.

S/B/192. Why and how do firms become multinational enterprises?

C/B/602. The organization of the modern MNEs is more than the old models of Global, multidomestic and transnational. Discuss

S/B/181. Corporate and Social Responsibility (CSR) and the World Trade Organisation (WTO)

E/B/256. Critically evaluate the reasons why international companies continue to use expatriate managers even though it is a very expensive option

S/B/172. Discuss what the appropriate management practices and related structures for multinational corporations to successfully stand erect across national borders

E/B/254. Corporate culture in multinational corporations

E/B/249. TNC may adopt a number of marketing strategies in host economies. Critically examine some of these strategic options

E/E/56. Towards Greater Involvement of Multinational Companies in African Economies

E/B/244. Managing and Working Across Cultures

E/B/240. How can the MNC country of origin impact on management practice in their foreign subsidiaries and what other factors may impact on the implementation of HRM and IR practices in MNC subsidiaries?

C/B/509. Master's Dissertation. Market Entry: A Developing Country Context

S/HR/92. Problems of international HRM: review of theories in MNC context

S/B/160. Dissertation. MNCs and FDI in China

P/B/857. Globalisation of companies: determinants of rise and decline

P/B/856. Global and regional strategies of MNE: case study of VW in USA

P/HR/329. Cultural issues of HRM in MNE

P/B/841. Discuss whether multinational corporations should opt for consistent management practices across national borders, or they should employ cultural specific management techniques.

C/B/435. Government administration and economic development: The case of Japan and China

P/B/818. Motivations behind internationalisation: theory and practices of MNE

P/B/796. MNC development under globalisation: country-of-origin effect

P/B/792. Dissertation. Emerging markets and MNC: opportunities, obstacles and optimal entry strategies

P/B/781. Multinational virtual teams: problems and distictive features

P/B/738. Determinants of FDI in MNC

P/B/714. Divisions of MNC

P/B/708. Foreign direct investment by MNC: advantages and threats

P/B/696. Impacts of TNC on host country’s economy: theory and case study

E/B/84. Aspects of international organisational control

P/B/620. Managerial matrix in transnational strategy

P/E/380. Developing countries and MNE: policy guidance

P/B/586. Distribution of production factories in Japanese electronic firms

S/B/112. Critically analyze the role of international organizations and their implications for developing countries

S/B/109. Globalisation

P/B/561. Advantages of MNE theory over FDI theory

P/B/560. Approaches to and applications of research and development strategy

P/B/543. New international division of labour theory and relocation of TNCs production

P/E/329. Does domestic economy gain from the presence of multinational companies?

P/E/322. Theories of foreign direct investment and multinational corporations

P/B/495. Global and regional strategies at multinational enterprises

C/B/330. Foreign Direct Investment (FDI): Influences and Strategies of Multinationals

C/B/311. Multinational Enterprises (MNEs) in Developing Countries

P/B/438. Global vs. trans-national organizations: whats the difference?

P/B/371. Transnational Corporations: export competitiveness

P/B/343. Applications of the Network Management System in a multi-national company

C/B/253. Trans-national corporations and the force they constitute for reforming national employment relations systems

P/B/327. Globalisation and the power of Corporations

P/B/269. Discuss typical motivations of governments in attempting to influence FDI flows

P/B/261. Dissertation. The Impact of Globalization: SMEs Vs. MNEs in the global marketplace

P/HR/105. How Might 'National Culture' Influence the Employee Relations Strategies of Foreign Owned MNC's in the UK?

P/HR/100. How would you evaluate whether performance-related pay in an appropriate policy for employees and managers in a multinational company?

P/B/220. Is it true to say that many U.S. multinational enterprises (MNEs) are more economically and politically powerful than some nation states? Does this scenario best explain America's rise to globalism and the real power behind the White House today?

P/B/211. Discuss the ways that culture environment affect the international business and advice on how to manage international operations in a multicultural environment

E/B/10. Evaluate how organisational culture might affect the management of different sizes of companies

P/B/165. Is multinationals exploiting or benefiting the third world?

P/B/158. Evolution of Transnational Corporations: summary and analysis of current developments

P/B/136. Does the growth of the transnational corporation presage a general decline in the nation state or are we simply seeing a form of old inequalities between nations?

P/B/137. Is Hymer's thesis on theory of the multinational corporation (MNE) still relevant today?

P/B/138. Outline the main competitive advantages that arise from successful clusters and industrial districts.

P/B/139. Describe the shifts in the world economy over the past thirty years. What are the implications of these shifts for multinational enterprises based in the EU, North America and Japan?

D/B/13. Project Proposal: Trust in a multinational organisation.

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