5. Recall the UN definition of “transnational corporation”. Describe the composition of a typical multinational (transnational) corporation. Why can the MNC not be treated as a “company”? What is the usual legal form of a parent company and its subsidiaries in many countries? What is the difference between the reports of the parent company and the MNC?

Introduction:

                     MNCs (Multinational Companies) area unit giant businesses that operate in a very range of nations. They typically separate their production between varied locations or have their completely different divisions – Head workplace and Administration, analysis and Development, Production, Assembly, Sales – separated around a continent or the world.

Ownership :                 

Some argue that possession could be a key criterion. A firm becomes international only the headquarter or the parent company is effectively closely-held by nationals of 2 or additional countries.

For example, Shell and Unilever, controlled by British and Dutch interests, area unit smart examples. The possession of most MNCs is unemotional.

What Is a Subsidiary?

within the company world, a subsidiary could be a company that belongs to a different company, which is sometimes observed as the parent company or the holding company.The parent holds an interest within the company, which means it's or controls over half its stock. In cases wherever a subsidiary is 100% closely-held by another firm, the subsidiary is observed as a wholly-owned subsidiary. Subsidiaries become vital once discussing a reverse triangle mortgage.

Economic Reasons for Subsidiaries:

the most reason for subsidiaries is a social science. Of the incentives, a rustic can give an international area unit tax incentives. The country might provide the business with a lower rate or variety of years while not national taxes to help in establishing the subsidiary. companies additionally produce subsidiaries for the precise purpose of limiting their liability about a brand new product or simply for in operation in a very new country. The parent and subsidiary have separate legal identities, which implies one isn't answerable for the actions of the opposite. The parent company isn't fully protected . Creditors will sue the parent if the subsidiary fails or cannot meet its obligations.

6. What are the competitive advantages multinational corporations have compared to domestic firms?

Competitive advantages of MNC:

1. Access to lower production costs:

Setting up production in alternative countries, particularly in developing economies, typically interprets to defrayment considerably less on production prices. although outsourcing could be a manner of achieving the target, fitting producing plants in alternative countries perhaps even additional cost-effective.

2. Proximity to focus on international markets:

it's helpful to line up business in countries wherever the target shopper market of a corporation is found. Doing, therefore, helps cut back transport prices and provides transnational companies easier access to shopper feedback and data, similarly on shopper intelligence.

International whole recognition makes the transition from totally different countries and their several markets easier and reduces per capita promoting prices because the same whole vision is applied worldwide.

3. Access to a bigger talent pool:

Multinational companies also are legendary to rent solely the most effective talent from around the world, which permits management to produce the most effective technical information and innovative thinking to their product or service.

4. turning away from tariffs

:When a corporation produces or manufactures its merchandise in another country wherever they additionally sell their merchandise, they're exempt from import quotas and tariffs.

  

7. Two possible logics of strategic analysis on the business-level are positioning and the resource-based view. Formulate the main points of difference between them.

What is Strategic Analysis?

Strategic analysis refers to the method of conducting analysis on a corporation and it's in operation set to formulate a method. The definition of strategic analysis might disagree from a tutorial or business perspective, however, the method involves many common factors:

Identifying and evaluating knowledge relevant to the company’s strategy
Defining the interior and external environments to be analyzed
Using many analytic ways like Porter’s 5 forces analysis, SWOT analysis, and value chain analysis.
Portfolio: “Portfolio” logic guides ancient conglomerates like GE and Tata cluster yet as personal equity companies like KKR & Co. and also the Blackstone cluster.
Leverage: Companies whose business units create serious use of the company's complete, technology, and alternative experiences like monger Joe’s and Burberry pursue a “leverage” logic.
Federal: The “federal” logic includes loose confederations of companies that unite to pass the business to 1 another, together lobby regulators, or share best practices, all while not a strong company parent. Examples embody Star Alliance in airlines and also the Leading Hotels of the globe in lodging.
Integrative: The “integrative” logic describes corporations within which business units bank each on company assets and each other to succeed. as an example, film producer theme parks, show studios, client product, and children’s tv divisions all use the company’s picture brands and characters to extend customers’ temperament to pay, and that they generate revenues by cross-promoting and marketing one another’s a product.

8.A large multinational manufacturer of fast-moving consumer goods (e.g. food, beverages, body care products, and household products) has pursued a strategy focusing on local responsiveness (= multi-domestic strategy). Now, the company is thinking of switching to a strategy that focuses on global integration (= global strategy). Briefly discuss 5 changes in the way the company operates that would result from this shift in strategy. a. What might be the biggest disadvantage of such this change in strategy for this company?

What is Strategic Analysis?

Strategic analysis refers to the method of conducting analysis on a corporation and it is in operation set to formulate a method. The definition of strategic analysis might disagree from a tutorial or business perspective, however, the method involves many common factors:

Identifying and evaluating information relevant to the company’s strategy
Defining the interior and external environments to be analyzed
Using many analytic strategies like Porter’s 5 forces analysis, SWOT analysis, and value chain analysis.
Portfolio: “Portfolio” logic guides ancient conglomerates like GE and Tata cluster yet as personal equity corporations like KKR & Co. and therefore the Blackstone cluster.
Leverage: Companies whose business units create significant use of the company whole, technology, and different experiences like dealer Joe’s and waterproof pursue a “leverage” logic.
Federal: The “federal” logic includes loose confederations of companies that unify to pass the business to at least one another, put together lobby regulators, or share best practices, all while not a strong company parent. Examples embrace Star Alliance in airlines and therefore the Leading Hotels of the globe in lodging.
Integrative: The “integrative” logic describes firms within which business units bank each on company assets and each other to succeed. as an example, movie maker theme parks, picture studios, client products, and children’s tv divisions all use the company’s picture brands and characters to extend customers’ disposition to pay, and that they generate revenues by cross-promoting and merchandising one another’s the product.