Kenneth C. Laudon,Jane P. Laudon Management Information System 12th Edition pdf

Franchisers

are an interesting mix of old and new. On the one hand, the

product is created, designed, financed, and initially produced in the home

country, but for product-specific reasons must rely heavily on foreign personnel

for further production, marketing, and human resources. Food franchisers such

TABLE 15-3

GLOBAL BUSINESS STRATEGY AND STRUCTURE

BUSINESS FUNCTION

DOMESTIC EXPORTER

MULTINATIONAL

FRANCHISER

TRANSNATIONAL

Production

Centralized

Dispersed

Coordinated

Coordinated

Finance/Accounting

Centralized

Centralized

Centralized

Coordinated

Sales/Marketing

Mixed

Dispersed

Coordinated

Coordinated

Human Resources

Centralized

Centralized

Coordinated

Coordinated

Strategic Management

Centralized

Centralized

Centralized 

Coordinated

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Part Four

Building and Managing Systems

as McDonald’s, Mrs. Fields Cookies, and KFC fit this pattern. McDonald’s created

a new form of fast-food chain in the United States and continues to rely largely

on the United States for inspiration of new products, strategic management, and

financing. Nevertheless, because the product must be produced locally—it is

perishable—extensive coordination and dispersal of production, local marketing,

and local recruitment of personnel are required. 

Generally, foreign franchisees are clones of the mother country units, but

fully coordinated worldwide production that could optimize factors of produc-

tion is not possible. For instance, potatoes and beef can generally not be bought

where they are cheapest on world markets but must be produced reasonably

close to the area of consumption.

Transnational firms are the stateless, truly globally managed firms that may

represent a larger part of international business in the future. Transnational

firms have no single national headquarters but instead have many regional

headquarters and perhaps a world headquarters. In a