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Centers of Excellence: The Role of Functions. The Agilent Technologies UK case

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7 Chapter 1 THE ROLE OF SUBSIDIARIES IN MODERN MNCs 1.1 A review of the practitioner literature The attention of scholars and the subsequent stream of literature on the matter have to be due to the pioneering work of Bartlett and Ghoshal (1986) who paved the way to others and established an overall frame which is still in use. In their article “Tap your subsidiary for global research” (1986) and the following milestone book “Managing across Borders. The Transnational Solution” (1989) 1 they started from an empirical observation of what was going on in the world of MNCs and through an inductive process they catalogued different subsidiaries within the same corporation according to the role they were playing within the strategy of the company. They saw that many companies were adopting what they called a ‘global strategy’ achieved by integrating different processes and homogenising the products sold in different markets or a ‘multinational strategy’ for which each national market was to be considered different and, as a consequence, had to be served in a different way 2 . On one hand, the homogenisation of consumers’ tastes worldwide -spontaneous or influenced by the companies themselves- and the economic difficulties of the 1980s suggested at first that the former form seemed to be more efficient; especially it could permit to achieve higher economies of scale and efficiency and to support subsidiaries in difficulty with resources generated elsewhere 3 . On the other hand, the higher freight costs typical of a centralised production system and the restrictions imposed by national governments -added to an undisputable difference of tastes in different segments of products between countries- showed that the latter was to be preferred. The solution was then to create strongly independent subsidiaries which could respond better to local needs. But the major problem of duplication of efforts and unsatisfactory coordination made it clear that this strategy was not a winning one either. 1 Following the 1998 revised and updated version (Second Edition). 2 Just to be exhaustive, they listed a third strategy taken in consideration by many companies, the so called ‘international strategy’ which suggested to consider global expansion similarly to the product life-cycle, launching new products in the home market at the beginning and then penetrating foreign markets; but this pattern is less relevant in this work. 3 Classical portfolio approach.

Anteprima della Tesi di Nicolas Vendramin

Anteprima della tesi: Centers of Excellence: The Role of Functions. The Agilent Technologies UK case, Pagina 3

Laurea liv.I

Facoltà: Economia

Autore: Nicolas Vendramin Contatta »

Composta da 37 pagine.

 

Questa tesi ha raggiunto 438 click dal 08/02/2005.

 

Consultata integralmente una volta.

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