Global Management in a Still-Fragmented World

© 2014 Prof. Farok J. Contractor, Rutgers University

In this post, we look at the job of the global manager, which covers two broad domains:

• Internal corporate strategy—which must address the issue of how international firms need to strike a balance between global standardization of their products and processes and the benefits of local adaptation (while at the same time deciding what decisions to centralize and which to devolve to foreign subsidiaries).
• External global strategy—which much address the challenge of how multinational companies need to manage global pressures they are forced to deal with, such as corporate social responsibility, activist groups, non-governmental organizations (NGOs), governments, and multilateral agencies that push the firm in directions it may not otherwise pursue while also managing cultural differences.

Both concerns—internal strategy and management of external relations—are connected by the fact that the world is fragmented into about 200 nations exhibiting a huge variation in income, culture, language, and government.

International Business involves the management and utilization of these differences across countries. … CONTINUED ON ARCHIVE