International Strategy: Context, Concepts and Implications

Chapter 10 How to Organize?

MOTIVATION

A recent student was looking forward to her future career as an international executive.¹ Excited by the opportunity, she came to ask what she should do to perform well in her new position. As we talked, the role became clear – she was to run a manufacturing facility in South Africa producing components for a key product that was sold to a few large multinationals. One of the first questions I asked was, “Who do you report to?” After a long pause, the student admitted that she was not sure – it could be the global head of manufacturing who was responsible for optimizing the corporation's global supply chain; it could be the president of the business unit to whom the product line reported; it could be the South African country manager in whose subsidiary she was based; or it could even be the corporate vice president of marketing in charge of global accounts. As I pointed out, “if you don't know who you report to, it's going to be hard to do a really good job for anyone!”

This anecdote illustrates the challenge, familiar to all global executives, of designing an organization capable of balancing the competing perspectives intrinsic to international competition. Indeed, organizational issues are often the most prominent concerns of international executives. Many is the time I have heard country managers complain how a local initiative, such as the design of new packaging, has been overruled by the global business unit head – “if only we ...