Multinational Corporations ( Mncs ) Essay

Multinational corporations can be divided into three broad groups according to the configuration of their production facilities:

To be qualified as a multinational company (MNC), two criterions need to be fulfilled. Firstly, it needs to have substantial direct investments in foreign countries. Secondly, these international operations need to be actively managed (Bartlett, Beamish, 2014). Since

A multinational corporation houses other offices and factories in different countries and regions (Investopedia.,2014). In addition, these corporations tend to have a centralized office where global management is carried out. Becoming a multinational corporation has the advantages of vertical and horizontal economies of scale as well increased market share due to the increased outputs (Investopedia.,2014). To contrast these corporations can be portrayed as entities that seek political and economic control. While this perception is not always the case it does occasionally occur because big businesses can impact the countries they are in.

I feel that transnational cooperation’s have had a large impact on globalisation. A transnational corporation (Multinational Corporation) TNC is a corporation or enterprise that manages production establishments or delivers services in at least two countries such as Coca Cola and Nike. Very large multinationals have budgets that exceed those of many countries. Multinational corporations can have a powerful influence in international relations and local economies and play an important role in globalisation. I feel that the economy is the most significant motivating force

MNC’s/TNC’s are companies that locate their factories in various places throughout the world. This gives countries more jobs, access to the global market, cheap manufacturing and large profits.

The companies have become a key parameter, especially in the global economy. The size of global companies closely correlated with the decrease of vulnerabilities, with higher resistance to economic shocks occurred along the time and with their bigger chances of success in certain markets. Companies aim not only to optimize their size, but also to strengthen the global production networks, affording them a better competitive position, in a mighty competitive environment and under the pressure of quick development of the technological environment. The size of an organization has become a barrier that stops its entry into the sector, higher than profitability, which explains why some corporations have focused, in recent times, more on strengthening their position abroad, although their economic performance does not justify this endeavor. The process of economic globalization is both a resultant of the increasing activity of multinational organizations and a cause of their increasingly stronger internationally affirmation. However, global organizations activity is much more intense in the developed countries; their impact on the developing countries must not be neglected. Global organizations have a few main features that individualize them from all other forms of companies known so far:

A TNC (transnational corporation) is a company that operates in no less than two countries and has a global outlook. TNCs have a long history going back to the 16th Century in terms of trade such as spices, but it’s not until C. 1945 that companies started to form acquisitions and mergers. The one key reason why these businesses have been so successful in their area of expertise globally is because they can take advantage of spatial differences in the factors of production worldwide. They are able to exploit differences in the availability of capital, labour costs and land cost, which we as a world have seen, especially in far-east

MNC’s may potentially bring a lot of benefits to the host nation, the company may invest in the host country and creating wealth and jobs. Multinational can raise the grown rate of the host country by bringing in new investment, new technologies or managerial competition, thereby induce their domestic rivals to become more innovative and competitive.Their size and scale of operation enables the company to benefit from economies of scale enabling lower average costs and prices for consumers. (Resource book)

These companies have been responsible for creating job opportunites, boosting the economy and creating a better soucer of living for the citizens of these countries. “The vast numbers of MNCs are located all around the world; they vary widely in size and interest. Their intention is to take a package of capital, technology, managerial know-how, or marketing skills to carry out production or business services abroad. Their effects are far reaching, affecting the daily lifestyle of the average consumer. Partly because of their size, MNCs tend to dominate the sectors in which they specialize. As a result, their transnational business ventures offer much debate about their impact on developing countries; many arguments have been proposed on this subject alone” ( ).

With the advancements in technology and innovation, the world appears to continue to grow smaller. With technology and innovative advancements, businesses have grown in local markets, as well as globally. An organization located in Taiwan seeking buyers and understanding the demands required can sell products all over the world. Multinational companies have been doing business in other countries for a century; however globalization has changed the picture for even smaller companies around the world. Smaller companies can also get their market share in the global economy. In this paper, globalization is defined, as well as identifying various challenges and opportunities associated with globalization.

Version 2015-02-09 Academic Year 2014-2015 Course unit Title: Multinational Management Course unit code: BMAN 70012 Credit Rating: 15 credits 1 Instructors Contact details Umair.Choksy@mbs.ac.uk Room: MBS East F3 Office hours: by arrangement Noemi.Sinkovics@mbs.ac.uk www.manchester.ac.uk/research/noemi.sinkovics Phone: (0161) 275 6492 Room: MBS East F11 Office hours: by arrangement

Multinational corporation’s main goals are to improve revenue and profits by keeping the costs down, and to maximize profits for its shareholders.

The purpose of this report is to define & understand how a MNC effect or effected by Home & Host country environments. Due to increasing global competition, changes in economic & political system business organisation are facing rapid change in business environment. The world is separated politically & financially into 200 countries separate countries where each country has its own laws, judiciary system and boundary regulations. We will be discussing how a MNC adapt these differentials and contribute to improve the economy and standard of living of the society. Multinational corporations have a huge impact on the host country economy as well as there are some problems also created by MNC in host country. For the view of

1) What are the two types of pressures that firms competing in the global marketplace typically face? Pressures for cost reductions and Pressures to be locally responsive

The objective of MNC to operate in other countries is to gain competitive advantage through several ways. Firstly, MNC is able to take advantage of difference in country-specific circumstances. For example, MNC may choose to locate its productions in less developed country like Vietnam to gain cheap labor cost. Secondly,