Managing in a global context

1007 palavras 5 páginas
Starting from 1980s the increasing growth of commercial relationships between firms from different countries has lead to the rise of several multinational companies (MNCs). Generally speaking, a MNC is a company with a global strategy which has its headquarter in the home country and one or more subsidiaries in at least one foreign country.
While the majority of MNCs today is from developed countries, in the past decade there has been an increase in number of MNCs from developing countries. According to a study by Ernst&Young (May 2008), these are claiming growing share of the global market, manufacturing and consuming themselves high-technology products and establishing their production bases abroad, most often in other developing countries. This phenomenon is called “Globalization 2.0” and refers to the trend of having developing countries-MNCs performing at levels comparable to those of their industrialized nations' competitors. Among the global Top20 on the stock market, 8 companies are from emerging countries. Nevertheless, there is a sharp distinction between the BRIC countries (Brazil, Russian Federation, India and China) and other developing countries: the first ones represent 53% in number among the world’s top 1000 companies.
For a country to be classified by the UN as a “developing country”, it must meet three criteria: a low-income criterion, a human resource weakness criterion and an economic vulnerability criterion. Among developing countries there are now considerable differences between the catching-up countries (e.g. newly industrialized countries) and falling behind, less developed countries.
Developing countries-MNCs tend to be less competitive than developed countries-MNCs because of underdeveloped institutions and problematic environments. They have smaller size, less cutting-edge technology and less sophisticated resources. But empirical analysis shows that when both types of MNCs operate in countries with difficult governance

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