Multinational Enterprises, Essay Example

Although many multinational enterprises have similar goals in terms of expansion and output, corporate culture of specific businesses will determine how these goals are achieved. In the cases of Carrefour, Coca-Cola, and Johnson & Johnson corporations, corporate culture is strikingly unique. In particular, these corporate cultures determine how products are manufactured, sold, and purchased abroad.

Coca-Cola has an interesting corporate culture and manner of doing business internationally. Although it is primarily known as an American company, it does 75% of its business outside of the United States. Therefore, the company has provided business professionals living abroad with a variety of ownership options. A particular example that this article discusses is that in China, the company owns its concentrate plant but partners with bottling plants. The particular strategy used varies according to country and according to what the cheapest production method would be in each unique case. As a consequence, decision making is centralized in some instances, such in the United States, and decentralized in other countries, such as China in which it must deviate from its corporate strategy in order to profit. Ultimately, Coco-Cola is not afraid of deviating from company norms to achieve success, and this is reflective of its corporate culture.

Like Coca-Cola, Carrefour does much of its business overseas. A major issue that the company faces is whether it should open or close its stores depending on business successes and failures. A secondary concern that the company has is identifying businesses that can act as partners that will help them reduce costs. Ultimately, their corporate culture is such that businesses will be expanded in areas that are profitable and diminishing business in areas that are not profitable. Rather than expanding for the sake of expanding, the company will test out businesses in areas they have not yet reached and determine based on a trial phase whether or not the business should continue. The decision-making process for this company is primarily centralized, which is apparent based on its ability to exert precise control on its businesses. While it is likely that the company would consider the opinions of their partners, these partnerships are less important to the decision making process and are in no way owners of their unique contribution to Carrefour.

Johnson & Johnson is a pharmaceutical company that operates primarily on the basis of market trends and the supply and demand that these numbers indicate. As a consequence, the company’s business decisions are made primarily as a consequence of the analysis of numbers and trends. Therefore, the company’s expansion is based on this process as well. Ultimately, the corporate culture is a calculated one and decisions will be made if they are statistically favorable. As a result, the decision-making of Johnson & Johnson is primarily centralized and these calculations occur primarily at the company’s headquarters and these plans and concepts are then sent to their locations around the world.

In conclusion, Coca-Cola, Carrefour, and Johnson & Johnson have unique corporate cultures that contribute to their individual success. These three companies sell very different products and it is possible that these business preferences have evolved from what works best for these unique industries. Ultimately, the decision making process in each instance has formed as a consequence of what works best for each company, and centralization or decentralization is a measure of this success.

References

Daniels, J., Radebaugh, L., & Sullivan, D. (2011). International business, environment & operations (13th ed.). Upper Saddle River, NJ: Prentice Hall.