multinational corporations
TRANSCRIPT
MULTINATIONAL CORPORATIONS
Created by Maria Matveeva
Maria Musaelyan
Kate Belyashina
Anna Lundberg
Julia Mónica Ortiz De Manuel
Contents
① Definition
② Organization
③ Globalization
④ Pros & Cons
⑤ Diffussion of org.knowledge
⑥ Economics and Politics
⑦ Examples of MNC’s
⑧ MNC’s in Russia
⑨ Inditex – operation in Russia
Definition
Multinational Corporation is a business organization whose activities are located in more than two countries and is the organizational form that
defines foreign direct investment.
The economic definition emphasizes the ability of owners and their managerial agents in one country to control the operations
in foreign countries.
Organization of multinational corporations• The United States
International division
Problems:
Area division and Product
division
More responsive to local
differences and tastes
• Price set by domestic
market – not competitive
• Products did not correspond
to foreign tastes
• Managers across areas
did not cooperate
AdvantagesDisadvantages
Organization of multinational corporations
Europe
*Holding company structures
*banks or other financial institutions played powerful roles in ownership
*complex financial webs
*subsidiary and a headquarters that held a portfolio consisting of ownership control over dozens of
companies, in the same sector but located in different countries.
Globalization
Due to implementing new digital technologies, the gap between poor and rich countries is increasing
Local and national governments always try to attract MCs because it is a huge investment into the economy, they provide employment, choice of
multi goods and etc.
Pro’s & Con’s
Pro’s Con’s
Advanced technology and low-cost products.
Workers and natural resources
Spread Technology Social Protection Fall
Cheapest sources of labour Manipulation
Have a wider market Global competition
Economies of scale in marketing and distribution
Foreign influence
Diffusion of organizational Knowledge
Central Feature
Diffusion of organizational Knowledge
Subsidiaries
Economics and Politics of Multinational Corporations
Developing Countries: • Loss of Independence
• Technologies
• High productivity Level
Examples of MNCs
MNC’s in Russia
• are global players
The largest by foreign assets and foreign sales
The leader in production
Global energy business:- entry into new markets; - diversification;- ensuring consumerssupplies
Entities inmany countries
The example of Inditex in Russia
-Based In Arteixo (Spain)
-The largest clothing retailer in the world
-5,500 stores worldwide
-274 stores in Russia
- Inditex is not among the biggest retailers in Russia
-the Spanish group’s revenues went up 20 percent in 2011 to 13.6 billion rubles (about $433 billion)
- In terms of revenue, the Spanish company is the 47th largest retailer in Russia
THANK YOU FOR YOUR ATTENTION
Which countries are against multinational Corporations and which are not?
Name three Pro’s and three Con’s of Multinational Corporations
What was the classic organizational problem that different national structures met?
Name the one MNC in each country that you have heard
What is the largest MNC in Russia and why ?