National American University
LP4 Assignment: Managerial Decision Making in a Global Environment
Managerial Decision Making in a Global Environment
An Effective Entry Strategy and Organizational Structure for New Ventures with the Thais
Thailand is the emerging country which will be suitable for shared value-adding joint ventures with my company in USA. This type of strategy will attract the Thailand partner. Both of countries will able to learn and develop new technological skills. This strategy will give an impact to organizational structure of Thai company who are working in decentralized structure (Luthans & Doh, 2009). The partners get time to know about the management styles. The team building, flexibility to adopt skills and supportive methods for communication will support my enter strategy, which is based on design of product (Busbarat, 2016). There will be some disadvantages, but we will discuss them clearly without causing problems for future.
The transnational network structure will implement in new partnership with Thailand (Intarakumnerd & Charoenporn, 2015). This structure is very useful for emerging countries. This structure combines the functions, products, geographical areas with the network management of subsidiaries. Only few decisions are centralized in this structure. Others are controlled by connecting countries. This structure gives the cultural support to Thailand with the chance to learn and share the information with the center.
The management system in Thailand is the good example of Asian culture in which the values of human resource management with the ability to understand, adopt and from the strong relationship (Intarakumnerd & Charoenporn, 2015). The actions have a long-term perspective and customers are important. Apart from it, in the USA, the management system is mainly directive, active and well formed. The decisions are short-term control. The product and services are main focuses than the customers. These different aspects will connect together in transnational network and creating a supporting environment for MNCs.
Challenges of International Management, Decision Making and Control in an International Environment
The political government is very weak and mainly the major functions usually handle by royal family, which is threat for new organizations to settle business in Thailand. The strength is the good relationships with the U.S.A with good supportive benefits for two way trade (Busbarat, 2016). The opportunities are many new investment contracts with the new governments. The weaknesses are internal political conflicts and military involvement in handling many government operations and foreign affairs. The ministry of foreign affairs, government department related to business and ministry of commerce are three main units for control of MNCs working in Thailand
Thailand has the requirement of foreign business license for the companies who want to work in the country. They need permission from the government before the start of any business. There are companies who have major power control outside the Thailand; they need to follow the policies under the Foreign Business Act (Intarakumnerd & Charoenporn, 2015). The trade policies are less restricted and supporting European MNCs to work in Thailand.
The ethical challenges are high crime rate with the increase in the case of human trafficking. The system has a strong impact of corruption and only few cases get proper investigation and then punishment at the end (Busbarat, 2016). The women employees are not treated equally like men. On domestic and organizational level the harassment cases are reported. The strengths are loyal, caring and energetic people who want to develop the society.
An Effective Entry Strategy and Organizational Structure for New Ventures with the Philippines
I will use the transnational organizational structure in Philippines case, which is a developing country. The headquarter will stay in the USA, but other operations like finance, marketing, production, function allocation will work in other countries. The information and knowledge network will spread through all the involved countries in this structure (Luthans & Doh, 2009). Philippines can get growth in internal scale more rapidly in this structure. So, it will be very effective. The organizational structures can be different in different geographical areas which are totally based on the functions of MNCs linked with the sector (Kacker, 2015). The countries can work as the independent power centers which can take many decisions according to the requirement of the situation without the influence of headquarter. This organizational structure will support the culture of connecting countries with the idea of sharing the benefits.
International joint venture will be an effective strategy to enter in Philippines by showing them the benefits of chances to improve efficiency by handling the restrictions in competition of businesses in the global market (Kacker, 2015). I will investment my time in knowing more about legal, political and ethical concerns of the local community in the Philippines, which will help me to define my goals more effectively (Luthans & Doh, 2009). Along with it, I will provide them a chance to do a complete analysis of the company before entering into any business relationship. It will be an effective approach to handle the future challenges by considering the needs of partners. There will be surely many differences in objectives of both countries, but through proper dealing methods, we will try to sort out them for a long-term relationship in the future.
Challenges of International Management, Decision Making and Control In An International Environment
Political government is not strong and due to internal conflicts in the country (Lum & Dolven, 2014). The legal process of handling of political and corruption cases of political parties is very weak. The delay in justice causes the imbalance in the society. The strength in the strong bureaucratic system which handles the business deals more quickly with the foreign parties without involving them into internal conflicts (Kacker, 2015). The local government system has different type of regularities which can cause problems for MNCs in dealing the local men power and land ownership.
The legal system is not well developed which even cannot handle the patent infringement issues. But, the foreign trade and business policies are impacting MNCs (Kacker, 2015). The tax and trade regulations are strict in certain places with the limitation of ownership and foreign investment. The land ownership and resources power dealing has many restrictions (Lum & Dolven, 2014). With the help of a legal expert, we can better handle the legal matters with the Philippines.
The corruption is the main ethical issue in the Philippines and day by day many people are becoming a victim of this problem. This is a big challenge for other multinational companies to work in Philippines by using local work force (Kacker, 2015). Along with it; human trafficking, bribery, terrorism and illegal drug dealings are other ethical issues which can make the foreigners feel unsafe in the Philippines (Lum & Dolven, 2014). The people have great impact of Muslim culture which is supporting the positive values of societies. This is the strength of the developing country.
An Effective Entry Strategy and Organizational Structure for New Ventures with the Japanese
Japan has nearly 22% alliance structure, 10% joint ventures, 3% mergers and acquisitions, 12% expand facilities and 4%new facilities as the partner country of multinational companies (Luthans & Doh, 2009). It has complete control over the working of MNCs. They are not allowed to work as a wholly owned subsidiary with the complete power and functions control (Krafft, Quatraro & Saviotti, 2014). It is because; this type of relationship the MNCs will disturb the business of local companies which is unfavorable in case of Japanese people who have a strong position in the market. I will use the alliance structure for the business with Japan. It will be a corporate type relationship on the agreement of the conditions of both the parties which have also complete access to knowledge and information. The political factors and competitive situation support the alliance structure in which the parties can work effectively by developing the trust for long –term relationship (Wai On, Liang, Priem & Shaffer, 2013).
The Matrix structure will be a good option for Japanese-USA MNCs (Luthans & Doh, 2009). It will allow the company to add changes in designs to meet the needs of the market. In this structure, the global product, geographical area and arrangements of functions are combined together for collective benefits (Krafft, Quatraro & Saviotti, 2014). Before entering in Japan, I will work on knowing more about the business policies, organizational structure and cultural differences of the society. I will analyze the important differences of the political, legal and ethical factors in Japan and U.S.A. Because of sitting in a strong position, I will consider all the requirements of Japan to form a strong partnership. The Japanese believe in loyalty and trust building in business relationships, so my company will use its strength to make it possible.
Challenges of International Management, Decision Making and Control in an International Environment
The political government has the complete control over the decisions related to the relationship with foreign countries. The policies are strict with the partnership in MNCs (Wai On, Liang, Priem & Shaffer, 2013). This is a weakness for making a business alliance with Japan. Recently, the new government has started the business policies for international and domestic business expansion of Japan, which is promoting the aspect of partnership with European countries for joint benefits. This is strength for my company to start collaboration with Japan. The political system is very strong and stabilized, which is giving an opportunity to MNCs to enter without the fear of economic and political breakdown (Krafft, Quatraro & Saviotti, 2014). The threats are some restrictions for foreign countries by the political parties to work in Japan. They are using them for the existence and support of local business.
The trade restrictions in a legal point of view are very low. The licensing of imports do not exist in Japan. This is strength for us to work in Japan. The legal system is slow and completely different from U.S.A, it will be a weakness (Krafft, Quatraro & Saviotti, 2014). The opportunity is existence of negotiation policies and laws by use of a third party to save time in business conflicts. The threats are the stricter rules for testing and evaluation of companies which come for business in Japan.
Japan has very low value of corruption. The people are loyal and motivated to support other people in the society. It is a great strength for us. On the other hand, the people are very conservation towards the non-Japanese people. They even cannot treat them equally. The opportunity is the great cultural and historical influence on people to follow work ethics without creating problems for others (Wai On, Liang, Priem & Shaffer, 2013). The threats are the biasness towards acceptance of the individual creativity and abilities of people. They believe on collective approach.
Busbarat, P. (2016). ” Bamboo Swirling in the Wind”: Thailand’s Foreign Policy Imbalance between China and the United States. Contemporary Southeast Asia: A Journal of International and Strategic Affairs, 38(2), 233-257.
Kacker, M. P. (2015). Internationalization of Retailing in the Asia-Pacific Region: Current Trends and Future Outlook. In Proceedings of the 1997 World Marketing Congress (pp. 496-503). Springer International Publishing.
Krafft, J., Quatraro, F., & Saviotti, P. P. (2014). Knowledge characteristics and the dynamics of technological alliances in pharmaceuticals: empirical evidence from Europe, US and Japan. Journal of Evolutionary Economics, 24(3), 587-622.
Intarakumnerd, P., & Charoenporn, P. (2015). Impact of stronger patent regimes on technology transfer: The case study of Thai automotive industry. Research Policy, 44(7), 1314-1326.
Lum, T., & Dolven, B. (2014). The Republic of the Philippines and US interests-2014. Current Politics and Economics of South, Southeastern, and Central Asia, 23(2), 177.
Luthans, F., & Doh, J. P. (2009). International management: Culture, strategy, and behavior. New York, NY: McGraw-Hill Irwin.
Wai On, L., Liang, X., Priem, R., & Shaffer, M. (2013). Top management team trust, behavioral integration and the performance of international joint ventures. Journal of Asia Business Studies, 7(2), 99-122.