Copyright 2011 Pearson Education

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International Business
Environments and Operations,
13/e
Global Edition
Part 5
Global Strategy, Structure, and
Implementation
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Chapter 15
The
Organization
of
International
Business
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Chapter Objectives
Profile the evolving understanding of organizing a
company for international business
Describe the antecedents and features of traditional
structures
Describe the antecedents and features of
contemporary structures
Study the systems used to coordinate and control
international activities
Profile the role and characteristics of organization
culture
Link the ideas of strategy and organization in the
international company

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Organizing Operations
Organizing is the process of creating
the structure, systems, and culture
needed to implement the companys
strategy.

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Factors
Affecting Organizing
Operations

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Change: The Critical Factor
Changes in the market environment and nature of work push
managers to rethink how they organize their workplace.
Trends inducing change:
Expansion of International Business
Importance of Knowledge as a Competitive Advantage
The Internet as a Design Standard
Workplace Adjustments
Managerial Adjustments
Changing Social Contract
Global Credit Crunch and Rising Unemployment


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Organization Structure
Structure: formal arrangement of jobs within a
company that specifies roles, responsibilities,
and relationships
Vertical Differentiation
Horizontal Differentiation

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Vertical Differentiation
Centralization versus Decentralization in
Organizational Design
Centralization: degree to which high-level
managers make strategic decisions and
delegate them to lower levels for
implementation.
Decentralization: degree to which lower-
level managers make and implement
strategic decisions.


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Horizontal Differentiation
Functional Structure
Advantages and Disadvantages
Divisional Structure
International Division
Product Division
Geographic Division
Matrix Structure
Unity of Command Principle
Mixed Structure
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Contemporary Structures
Network Structure
Virtual Organization
Pitfalls of Contemporary Structures
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Coordination and Control Systems
Approaches to Coordination:
Standardization
Plan
Mutual Adjustment
Control Methods:
Market
Bureaucratic
Clan

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Control Tools
Reports
Visits to Subsidiaries
Cost and Accounting Comparisons
Evaluative Metrics
Information Systems
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Organization Culture
The Importance of Culture
Culture and Values
Culture and the Value Chain
Challenges and Pitfalls
Organization Culture and Strategy
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Future: The Role and Rise of
Corporate Universities
Managers believe companies must
purposefully develop shared values
Worldwide, more than 1,000 new corporate
universities have begun operations
Corporate universitiesphysical and virtual
institutions that:
Lead training efforts
Facilitate learning
Help upgrade competencies
While advocating the philosophical ideals of the
companys culture





Copyright 2011 Pearson Education
15-15
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