Bartlett and Ghosal (1989)

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Bartlett and Ghosal (1989) - Managing Across Borders

The authors observe international management and notice a change is required. The traditional international management model revolves around transporting your own ways of doing business into other countries to achieve economies of scale. Local tastes were ignored and standardisation was the main goal. Firms either had a global outlook, or a local one, not both.

• Multinational companies are decentralised firms, which focus more on local needs. Co-ordination of the company takes a back seat.
• International companies transfer knowledge overseas to countries which are less developed. Federations of local businesses are co-ordinated well, but are controlled by a central source in the home country.
• Global companies offer scale efficiencies and cost advantages. It aims to standardise all products and processes.
• Transnational companies have a global strategy with local responsiveness built into it. Subsidiaries are used to capitalise on market opportunities and co-ordination of the business is essential. Manufacturing and technology development are located wherever it makes sense – there is no loyalty to the home country.

Integration and coherence of global and local strategies are keys to international success. Companies need to be bound by shared values. Three techniques can ensure this:

1. Clear shared understanding of the company’s mission and objectives
2. Examples set by behaviour and commitment of managers
3. Corporate HR policies are set to develop a multidimensional and flexible organisation process