Multinational Organizations Have Cross Border Operations

838 WordsJan 15, 20154 Pages
A multinational is defined as “a company operating in several countries”, while multicultural is defined as “relating to or containing several cultural or ethnic groups within a society” (Oxford English Dictionary). Lundby & Kraut (2010) explain that organizations can function in four stages of globalization: “multinational, international, transitioning to global and global” (Kindle Location 553-554). Multinational organizations have cross-border operations that are primarily decentralized and autonomous. Decentralized organizations give more authority to lower level employees giving them a sense of empowerment. International organizations have a headquarters that retains some decision-making control but the organization is still largely decentralized. International companies build one or a few facilities in another country, in trying to have a competitive edge and lower costs, they become multinational when they build facilities in a number of different countries. An example is the U.S. automakers facilities in Mexico for cheap labor and Eastern Europe for manufacturing and assembly (Noe, Hollenbeck, Gerhart & Wright, 2012). Transitioning to global organizations are the ones that take concrete steps to develop worldwide business strategies and policies. Global organizations develop strategies and policies on a worldwide basis and share resources across borders. The key word here is share. Culture is defined as “patterns of doing and thinking that are passed on
Open Document