The need for and improvement of budgetary planning in a multinational corporation

The aim of this research is to improve the planning methodology of Dunlop via an analysis of their annual planning system. This was approached via an investigation of how the plans were developed; extensive interviews, which analysed divisional attitudes and approaches to planning; an analysis of forecast accuracy; and participation in the planning system itself. These investigations revealed certain deficiencies in the operating of the system. In particular, little evidence of formal planning could be found, and some divisions were reacting ex post to the market, rather than planning ex ante. The resulting plans tended to lack resilience and were generally unrealistic, partly because of imposed targets. Similarly, because the links between the elements of the system were often inefficient, previously agreed strategies were not always implemented. The analysis of forecast accuracy in the plans revealed divisions to be poor at most aspects of forecasting. Simple naive models often outperformed divisional forecasts, and much of the error was attributed to systematic, and therefore eliminable factors. These analyses suggested the need for a new system which is proposed in the form of Budgetary Planning. This system involves conceptual changes within the current planning framework. Such changes aim to revise tactical planning in order to meet the needs placed on it by. in particular, strategic planning. Budgetary Planning is an innovation in terms of the current planning literature. It is a total system of annual planning aimed at implementing and controlling the iteratively agreed strategies within the current environment. This is achieved by the generation of tactical alternatives, variable funding and concentration of forecast credibility, all of which aid both the realism and the resilience of planning.

Transferring knowledge of manufacturing techniques in multinational corporations:preliminary findings

With the growth of the multinational corporation (MNC) has come the need to understand how parent companies transfer knowledge to, and manage the operations of, their subsidiaries. This is of particular interest to manufacturing companies transferring their operations overseas. Japanese companies in particular have been pioneering in this regard, with techniques such as the Toyota Production System (TPS) for transferring the ethos of Japanese manufacturing and maintaining quality and control in overseas subsidiaries. A great deal has been written about the process of transferring Japanese manufacturing techniques, but much less is understood about how the subsidiaries themselves, which are required to make use of such techniques, actually acquire and incorporate them into their operations. The research on which this paper is based therefore examines how, from the perspective of the subsidiary, knowledge of manufacturing techniques is transferred from the parent company. There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate knowledge about manufacturing techniques into their working practices. In-depth qualitative research was, therefore, conducted in the subsidiary of a Japanese multinational, Denso Corporation, involving three main manufacturing initiatives (or philosophies), namely ‘TPS’, ‘TPM’ and ‘TS’. The case data were derived from 52 in-depth interviews with project members, moderate participant observations, and documentations. The aim of this paper is to present the preliminary findings from the case analyses. The research contributes to our understanding of knowledge transfer in relation to the circumstances of the selection between adaptation and replication of knowledge in the subsidiary from its parent. In particular this understanding relates to transfer across different flows and levels in the organisational hierarchy, how the whole process is managed, and also how modification takes place.

Technology sourcing versus technology exploitation:An analysis of US foreign direct investment flows

The traditional paradigm of foreign direct investment (FDI) suggests that FDI is undertaken principally to exploit some firm-specific advantage in a foreign country which provides a locational advantage to the investor. However, recent theoretical work suggests a model of FDI in which the motivation is not to exploit existing technological advantages in a foreign country, but to access such technology and transfer it from the host economy to the investing multinational corporation via spillover effects. This paper tests the technology sourcing versus technology exploiting hypotheses for a panel of sectoral FDI flows between the United States and major OECD nations over a 15 year period. The research makes use of Patel and Vega's (Research Policy, 28, 145-55, 1999) taxonomy of sectors which are likely a priori to exhibit technology sourcing and exploiting behaviour respectively. While there is evidence that FDI flows into the United States are attracted to R and D intensive sectors, very little support is found for the technology sourcing hypothesis either for inward or outward FDI flows. The results suggest that, in aggregate, firm-specific 'ownership' effects remain powerful determinants of FDI flows.

Transferring knowledge of manufacturing techniques within a subsidiary of a multi-national corporation

With the growth of the multi-national corporation (MNCs) has come the need to understand how parent companies transfer knowledge to, and manage the operations of, their subsidiaries. This is of particular interest to manufacturing companies transferring their operations overseas. Japanese companies in particular have been pioneering in the development of techniques such as Kaizen, and elements of the Toyota Production System (TPS) such as Kanban, which can be useful tools for transferring the ethos of Japanese manufacturing and maintaining quality and control in overseas subsidiaries. Much has been written about the process of transferring Japanese manufacturing techniques but much less is understood about how the subsidiaries themselves – which are required to make use of such techniques – actually acquire and incorporate them into their operations. This research therefore takes the perspective of the subsidiary in examining how knowledge of manufacturing techniques is transferred from the parent company within its surrounding (subsidiary). There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate this knowledge into their working practices. A particularly relevant theme is how subsidiaries both replicate and adapt knowledge from parents and the circumstances in which replication or adaptation occurs. However, it is shown that there is a lack of research which takes an in-depth look at these processes from the perspective of the participants themselves. This is particularly important as much knowledge literature argues that knowledge is best viewed as enacted and learned in practice – and therefore transferred in person – rather than by the transfer of abstract and de-contextualised information. What is needed, therefore, is further research which makes an in-depth examination of what happens at the subsidiary level for this transfer process to occur. There is clearly a need to take a practice-based view to understanding how the local managers and operatives incorporate knowledge about manufacturing techniques into their working practices. In depth qualitative research was, therefore, conducted in the subsidiary of a Japanese multinational, Gambatte Corporation, involving three main manufacturing initiatives (or philosophies), namely 'TPS‘, 'TPM‘ and 'TS‘. The case data were derived from 52 in-depth interviews with project members, moderate-participant observations, and documentations and presented and analysed in episodes format. This study contributes to our understanding of knowledge transfer in relation to the approaches and circumstances of adaptation and replication of knowledge within the subsidiary, how the whole process is developed, and also how 'innovation‘ takes place. This study further understood that the process of knowledge transfer could be explained as a process of Reciprocal Provider-Learner Exchange that can be linked to the Experiential Learning Theory.

Multinational enterprises and technological effort by local firms:a case study of the Malaysian electronics and electrical industry

It is often assumed that foreign MNEs are the driving force behind technological development in developing economies but it has become evident in recent years that the actions of MNEs in isolation from the domestic economy. The study, therefore, examines the determinants of local firms' decisions to undertake technological effort, not only in isolation, but also in the context of linkages between domestic firms and MNEs. There is evidence that linkages between MNEs and local firms are important in explaining technological effort by local firms but direct technological assistance from MNEs does not seem to play a major role in fostering increased technological effort by local firms.

Evaluating approaches to product design and sourcing decisions in multinational companies

Product design and sourcing decisions are among the most difficult and important of all decisions facing multinational manufacturing companies, yet associated decision support and evaluation systems tend to be myopic in nature. Design for manufacture and assembly techniques, for example, generally focuses on manufacturing capability and ignores capacity although both should be considered. Similarly, most modelling and evaluation tools available to examine the performance of various solution and improvement techniques have a narrower scope than desired. A unique collaboration, funded by the US National Science Foundation, between researchers in the USA and the UK currently addresses these problems. This paper describes a technique known as Design For the Existing Environment (DFEE) and an holistic evaluation system based on enterprise simulation that was used to demonstrate the business benefits of DFEE applied in a simple product development and manufacturing case study. A project that will extend these techniques to evaluate global product sourcing strategies is described along with the practical difficulties of building an enterprise simulation on the scale and detail required.

Retail multinational learning:a case study of Tesco

Purpose - This article examines the internationalisation of Tesco and extracts the salient lessons learned from this process. Design/methodology/ approach - This research draws on a dataset of 62 in-depth interviews with key executives, sell- and buy-side analysts and corporate advisers at the leading investment banks in the City of London to detail the experiences of Tesco's European expansion. Findings - The case study of Tesco illuminates a number of different dimensions of the company's international experience. It offers some new insights into learning in international distribution environments such as the idea that learning is facilitated by uncertainty or "shocks" in the international retail marketplace; the size of the domestic market may inhibit change and so disable international learning; and learning is not necessarily facilitated by step-by-step incremental approaches to expansion. Research limitations/implications - The paper explores learning from a rather broad perspective, although it is hoped that these parameters can be used to raise a new set of more detailed priorities for future research on international retail learning. It is also recognised that the data gathered for this case study focus on Tesco's European operations. Practical implications - This paper raises a number of interesting issues such as whether the extremities of the business may be a more appropriate place for management to experiment and test new retail innovations, and the extent to which retailers take self-reflection seriously. Originality/value - The paper applies a new theoretical learning perspective to capture the variety of experiences during the internationalisation process, thus addressing a major gap in our understanding of the whole internationalisation process. © Emerald Group Publishing Limited.

Multinational firms, innovation and productivity

Book review: Multinational Firms, Innovation and Productivity, by Davide Castellani and Antonello Zanfei, Journal of International Business Studies, 2007.

The impact of the language barrier on the management of multinational companies : a case study and survey, based exploration of the impact of the language barrier on the strategies, policies and systems by which multinational companies manage their subsidaries

The thesis begins with a conceptual model of the way that language diversity affects the strategies, organisation and subsidiary control policies of multinational companies. The model is based solely on the researcher'’ personal experience of working in a variety of international management roles, but in Chapter 2 a wide-ranging review of related academic literature finds evidence to support the key ideas. The model is developed as a series of propositions which are tested in a comparative case study, refined and then re-tested in a global survey of multinational subsidiaries. The principal findings of the empirical phases of the thesis endorse the main tenets of the model: - That language difference between parent and subsidiary will impair communication, create mistrust and impede relationship development. - That subsequently the feelings of uncertainty, suspicion and mistrust will influence the decisions taken by the parent company. - They will have heightened sensitivity to language issues and will implement policies to manage language differences. - They will adopt low-risk strategies in host countries where they are concerned about language difference. - They will use organisational and manpower strategies to minimise the consequences and risks of the communications problems with the subsidiary. - As a consequence the level of integration and knowledge flow between parent and subsidiary will be curtailed. - They will adopt styles of control that depend least on their ability to communicate with their subsidiary. Although there is adequate support for all of the above conclusions, on some key points the evidence of the Case Studies and Survey is contradictory. The thesis, therefore, closes with an agenda for further research that would address these inconsistencies.

The work situation and class position of Brazilian engineers

This thesis analyses the work situation and class position of Brazilian engineers through a Marxist perspective. The research is based on two case studies, one focused on a large German steel company based in Brazil and the other on a large Brazilian energy corporation. The fieldwork involved 114 interviews, with engineers from different hierarchical positions in these two companies. Data was also gathered through interviews with representatives from the companies, the Council of Engineering, the Engineering Education System and the Engineers Trade Unions. The findings show that the engineering profession in Brazil has shifted from its initial condition as a liberal profession to an organizational profession, with the country's industrial deployment. Both companies consider all salaried workers as employees, including managers. Hence they are subject to the company's general personnel policies. The multinational company controls labour more rigidly than the national company, as well as reserving its top positions for its home country's executives. Although no deskilling process was found, engineers of both companies performed simple work, which required less engineering knowledge than they had learned from school. Engineers have little autonomy, authority and participation in decision making and are subject to direct supervision, performance evaluation, time control, overtime work, productivity and to poor working conditions in the multinational company. The majority of the engineers supervised other workers without being in a managerial position. They found that to move into management, was a good way to improve their autonomy, authority, prestige, salary, status, power and professional pride. Despite ideological divisions between capital and labour, most of the engineers were unionised and saw unions as the right way to deal with the employer.

Real options and multinational investments : an empirical study of risk, performance and organisational awareness

DUE TO COPYRIGHT RESTRICTIONS ONLY AVAILABLE FOR CONSULTATION AT ASTON UNIVERSITY LIBRARY AND INFORMATION SERVICES WITH PRIOR ARRANGEMENT This thesis is a cross-disciplinary study of the empirical impact of real options theory in the fields of decision sciences and performance management. Borrowing from the economics, strategy and operations research literature, the research examines the risk and performance implications of real options in firms’ strategic investments and multinational operations. An emphasis is placed on the flexibility potential and competitive advantage of multinational corporations to explore the extent to which real options analysis can be classified as best practice in management research. Using a combination of qualitative and quantitative techniques the evidence suggests that, if real options are explored and exploited appropriately, real options management can result in superior performance for multinational companies. The qualitative findings give an overview of the practical advantages and disadvantages of real options and the statistical results reveal that firms which have developed a high awareness of their real options are, as predicted by the theory, able to reduce their downside risk and increase profits through flexibility, organisational slack and multinationality. Although real options awareness does not systematically guarantee higher returns from operations, supplementary findings indicate that firms with evidence of significant investments in the acquisition of real options knowledge tend to outperform competitors which are unaware of their real options. There are three contributions of this research. First, it extends the real options and capacity planning literature to path-dependent contingent-claims analysis to underline the benefits of average type options in capacity allocation. Second, it is thought to be the first to explicitly examine the performance effects of real options on a sample of firms which have developed partial capabilities in real options analysis suggesting that real options diffusion can be key to value creation. Third, it builds a new decision-aiding framework to facilitate the use of real options in projects appraisal and strategic planning.

Women of the corporation:a sociolinguistic perspective of senior women’s leadership language in the UK

This paper reconceptualises a classic theory (Kanter 1993[1977]) on gender and leadership in order to provide fresh insights for both sociolinguistic and management thinking. Kanter claimed that there are four approved ‘role traps’ for women leaders in male-dominated organisations: Mother, Pet, Seductress and Iron Maiden, based on familiar historical archetypes of women in power. This paper reinterprets Kanter's construct of role traps in sociolinguistic terms as gendered, discursive resources that senior women utilise proactively to interact with their predominantly male colleagues. Based on a Research Council funded1 study of 14 senior leaders (seven female and seven male) each conducting at least one senior management meeting in the U.K., the paper finds that individual speakers can transform stereotyped subject positions into powerful discursive resources to accomplish the goals of leadership, albeit marked by gender.