Global Competitive Pressures and Host Country Demands: Managing Tensions in MNCs

by C. Prahalad, Christopher Bartlett, Yves Doz



The article discusses four management approaches for facing global competitive pressures and host country demands for business enterprises are neither mutually exclusive nor totally interchangeable. They correspond to different levels of complexity and tension in the decisions being faced by the company. The complexity of critical decisions varies substantially between a company with a single business in a few foreign markets, and a diversified company operating in a large number of national environments. Not only is there likely to be an increased need for coordinated management approach in the latter situation, but also top management will be less able to maintain a detailed understanding of the substance of the numerous complex decisions central to the company's successful operations. In businesses where tension between global integration and national responsiveness is high, the need for decisions that reflect both perspectives may force management to develop processes that provide such outcomes rather than try to personally integrate the disparate views on each issue.

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