The impact of management in the globalization of business

The impact of management in the globalization of business

This economic phenomenon gave rise to multinational corporations (MNCs) which made entry to a host country either through acquisition or international joint ventures ( These are firms which are fully owned subsidiaries or management responsibility for international joint ventures (IJVs). Thus, “MNCs are a relatively recent development with most of them founded after World War II” (

In view of this, new management styles are evolving to adapt with diverse and culturally different environments corporations venture into in its business operations outside of its national borders. To illustrate this, McDonald’s management control is so devolved in its operation in its host countries that it is now characterized as an amalgamation of local business run by local entrepreneurs. While on the other hand, business outsourcing – another strategic entry mode of global business – is faced with a new set of managerial challenges wherein top managerial position usually goes to the partner that has dominant equity position or some other basis of power such as virtual technology (

According to Sarah Ganly (2010), “Globalization has also impacted management because it has led to many employees transfers to international locations. This causes the need for more management and forms of communication. This also requires management to consider the needs of employees in other countries and to offer compensation for relocation. Thus, management must consider a much larger market, more competition, and international employees.”

With these considerations, it is necessary therefore that the management approach employed by MNCs must be adaptive to its new setting and that its staff must be skilled in international relations where cultural diversity and differences are considered in their interaction with their global partners.


Ganly, Sarah (2010). The Effects Of Globalization On...

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