THE RISE OF THE GLOBAL CORPORATION

GLOBAL CORPORATION

 One that does business in at

least one country outside of
it’s country origin.
PRESENCE IN KEY GLOBAL MARKETS

GLOBAL MARKETING
 Involves planning, producing, placing, and
promoting a business’ products or services
in the worldwide market.
 COMPETITIVE STRATEGIES OF GLOBAL
CORPORATIONS

3 WAYS TO GAIN AN ADVANTAGE OVER COMPETITORS OR THE SO

CALLED, “GENERIC COMPETITIVE STRATEGIES” AND THIS IS ACCORDING
TO MICHAEL PORTER:

1. Cost leadership
2. Differentiation
3. Focus
 GLOBALIZATION DRIVERS

Both external and internal factors will create the favorable

conditions for development of strategy and resource
allocation on a global basis . Here are some of the factors:

Market factors
Cost factors
Environmental factors
Competitive factors
FUNCTIONS OF GLOBAL
CORPORATIONS
 GLOBAL CORPORATIONS IS AN-

 Global corporations operate in two or more

countries and face many challenges in
their quest to capture value in the global
market.

 International operations that are either

achieving higher levels of revenue or a
lower cost structure within the operations
or value-chain.
 THE FOLLOWING DISTINCTIONS OFFERED BY
IWAN(2012) ARE AS FOLLOWS:

 International companies are importers and exporters,

typically without investment outside of their home country

 Multinational companies have investment in other countries.

 Global companies have invested in and are present in many

countries.

 Transnational companies are more complex organizations

which have invested in foreign operations.
 EXAMPLES OF INTERNATIONAL
COMPANIES

• Aeropost International Services, • BUNGE.

Inc.Logistics,Transportation,
AirTransportation. • CARGILL.

• ARCHER DANIELS MIDLAND • GLENCORE INTERNATIONAL.

CO.
• BorderJump, LLC Advertising,
Logistics, Transportation.
• GUNVOR GROUP.
• JFPI Corporation Finance,
Mining, International trade.
 EXAMPLE: LIST OF MULTINATIONAL
COMPANIES

• Microsoft • Coca Cola

• Apple • Adidas
 FORTUNE GLOBAL 500 LIST OF 2019

Rank Company Country Industry Revenue in USD

1 Walmart United States Retail $514 billion

2 Sinopec Group China Petroleum $415 billion

3 Royal Dutch Shell Netherlands Petroleum $397 billion

4 China National Petroleum China Petroleum $393 billion

5 State Grid China Energy $387 billion

6 Saudi Aramco Saudi Arabia Energy $356 billion

7 BP Unit. Kingdom Petroleum $304 billion

8 Exxon Mobil United States Petroleum $290 billion

9 Volkswagen Germany Automobiles $278 billion
10 Toyota Motor Japan Automobiles $273 billion
 EXAMPLE OF TRANSNATIONAL
COMPANIES
Table 1: 5 Leading Transnational Companies

World's Leading Transnational Corporations by Foreign Assets, 1996 (billions of US$)

FOREIGN TOTAL
CORPORATION COUNTRY INDUSTRY
ASSETS ASSETS

general electric United States electronics 82.8 272.4

shell, royal dutch United Kingdom/Netherlands petroleum 82.1 124.1

ford motors United States automotive 79.1 258.0

exxon United States petroleum 55.6 95.5
general motors United States automotive 55.4 222.1
 Table 2: 5 Undermost Transnational Companies

World's Leading Transnational Corporations by Foreign Assets, 1996 (billions of US$)

FOREIGN TOTAL
CORPORATION COUNTRY INDUSTRY
ASSETS ASSETS
pharmaceuticals/
novartis Switzerland 21.4 43.4
chemicals

British petroleum United Kingdom petroleum 20.7 31.8

Philip morris United States Food/tobacco 20.6 54.9

Eni group Italy petroleum ------ 59.5
renualt France automotive 19.0 42.2
STRUCTURAL PERIODS OF
GLOBAL CORPORATIONS
 INVESTMENT-BASED GLOBALIZATION

Investment globalization is defined, in principle,

as the proportion of all invested capital in the
world that is owned by non-nationals (Chase-
Dunn, 2000).
 TRADE-BASED GLOBALIZATION

Is a type of economic globalization and a

measure (economic indicator) of economic
integration.
 What is ECONOMIC GLOBALIZATION?

IS ONE DIMENSIONS OF GLOBALIZATION

COMMONLY FOUND IN ACADEMIC
LITERATURE, WITH THE TWO OTHERS
BEING POLITICAL GLOBALIZATION AND
CULTURAL GLOBALIZATION, AS WELL AS
THE GENERAL TERM OF GLOBALIZATION.
 WHAT IS ECONOMIC INDICATOR

Economic integration is the unification of

economic policies between different states,
through the partial or full abolition of tariff and
non-tariff restrictions on trade.
 DIGITAL GLOBALIZATION

The process of globalization is entering a new

era characterized by soaring flows of cross-
border information. As the locus shifts from
physical networks of production and trade to
global information networks.
MAJOR CONCERNS OF
GLOBAL MANAGERS
 3 PRIMARY ISSUES THAT CONCERNS
GLOBAL MANAGERS

1. PROCUREMENT

Involves decisions about the source, timing and means of

obtaining needed inputs.

 The action of obtaining or procuring something.

 It is also the acquisition of goods, services, or works from

an outside external.
 PROCUREMENT ISSUES

DEGREE OF INTEGRATION

NATIONAL ORIGIN

TIMING ISSUES
2. Production

Involves the location, type, and coordination of facilities, as well

as total quality management.

The action of making or manufacturing from components or raw

materials, or the process of being so manufactured.

It is also a process of combining various material inputs and

immaterial inputs (plans, know-how) in order to make something
for consumption (output). It is the act of creating an output, a good
service which has value and contributes to the utility of individuals.
 OPERATIONAL STRATEGIES
OF GLOBAL CORPORATIONS

Location of Facilities

Concentrated versus Dispersed Facilities

Distinctive Characteristics of Location

3. Delivery

Involves getting the finished product to the

customer and logistical networks as they apply
to the entire operational system.

It is the process of transporting goods from a

source location to a predefined destination.
CHALLENGES OF GLOBALIZATION

 Market Factors

 Internal Factors