1. Chapter 4 Computer Use in an International Marketplace
MANAGEMENT INFORMATION SYSTEMS 8/E
Raymond McLeod, Jr. and George Schell
Chapter 4
Computer Use in an International Marketplace
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Copyright 2001 Prentice-Hall, Inc. 1

2. The Multinational Corporation (MNC)
Parent company and group of subsidiaries
Operates across
Products
Markets
Nations
Cultures
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3. Each Subsidiary Has Its Own
Geography
Goals
Policies
Procedures
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4. Special Need for Information Processing in an MNC
Influenced by internal and external conditions
Seeks to minimize environmental uncertainty
Uncertainty - Difference between information required and information possessed
Requires ‘good’ use of information technology to achieve desired performance
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5. Types of MNC Organizational Structure Classifications
Each structure requires its own information processor
Worldwide functional divisions
Organized along functional lines
Marketing in subsidiary reports to marketing in parent company
Strategic planning done at top executive level
Data that integrates operations does not exist at lower levels
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6. MNC Classifications (cont.)
International regions
International division separate from domestic division
Geographic regions
Each region responsible for its subsidiaries
No communication between regions
Communication coordinated by parent company
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7. MNC Classifications (cont.)
Worldwide product divisions
Product division responsible for operations worldwide
Helps recognize product specific needs
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8. Need for Coordination in an MNC
Greater need than domestic companies
Companies unable to gain strategic control of their worldwide operations and manage them in a globally coordinated manner will not succeed in the emerging international economy
Resources are widely distributed
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9. Need for Coordination in an MNC (cont.)
Improvements in information technology and methodology have made global coordination somewhat easier
Still, coordination is big challenge
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10. Advantages of Coordination in an MNC
Flexibility in responding to competitors
Ability to respond in one country to a change in another
Ability to keep abreast of market needs around the world
Ability to transfer knowledge between units in different countries
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11. Advantages of Coordination in an MNC (cont.)
Reduced overall costs of operation
Increased efficiency and effectiveness in meeting customer needs
Ability to achieve and maintain diversity in firm’s products, their production, and distribution
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12. Global Business Strategies
Multinational strategy
Global strategy
International strategy
Transnational strategy
All use global information systems (GISs) in various ways
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13. Loose controls; strategic decisions remote
Multinational Strategy
Loose controls; strategic decisions remote HQ
Financial reporting flows
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14. Global Strategy HQ Tight controls; centrally driven strategy
One-way flows,
goods, information,
and resources
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15. International Strategy
Assets, responsibilities decentralized
Formal control systems HQ
International
mentality
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16. Transnational Strategy
Complex controls; high coordination skills,coordinated strategic decision process
Heavy flows;
materials, people
information, technology
Distributed
capabilities,
resources and
decision making HQ
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17. Global Business Drivers (GBD)
Joint resources
Flexible operations
Rationalized operations
Risk reduction
Global products
Scarce supplies
Corporate customers
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18. GBDs Cautions All GBDs do not apply to all MCNs
Drivers have many influences
Industry
Country
Own characteristics
Business units within firm
Provide vehicle for mapping out SPIR
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19. Global Information Systems (GISs) Implementation Problems
Politically imposed constraints
Hardware purchases and imports
Data processing
Data communications
Transborder data flows (TDF)
Operational data
Personal data
Electronic funds transfer
Technical and scientific data
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20. Global Information Systems (GISs) Implementation Problems (cont.)
Technological problems
Unreliable power
Slow telecommunications
Software copyrights and blackmarket products
Lack of support from subsidiary managers
View corporate office as an ‘outsider’
Drag heels to improve local profitability
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21. GIS Implementation Strategies
Multinational strategy
Development teams derived from subsidiaries
Global strategy
Development teams derived from parent location
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22. GIC Implementation Strategies (cont.)
International
Development teams can travel from parent to subsidiaries
Transnational strategy
Development team includes members from both parent and subsidiaries
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23. Transnational Strategy
Link the GIS to business strategy
Define the information resources
Provide for data sharing
Consider the cultural environment
Caution: the tasks and issues listed above are issues to be
addressed, not steps to always be followed in strict sequence
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24. Computing Around the World
Group Support Systems (GSS) in Africa
Top management influences
Computing literacy
Referent power
Oral communication preference
Satisfaction with use
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25. Group Support Systems (GSS)
Systems that typically support problem solvers meeting in groups settings
Also called group decision support systems (GDSS)
An expansion of the DSS area
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26. Factors Influencing Acceptance of GSS
Endorsement by Top Management
Satisfaction
with Use + +
Acceptance
of GSS
Computer
Literacy +
Oral
Communication
Preference - -
Referent
Power
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27. Computing Around the World (cont.)
Strategic Decision Support System (SDS) in Switzerland
SDS helps managers understand business strategy and its implications
Tools and models
Cases
Tutorials
Applications
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28. International Computer Use in Perspective
Great deal of attention given to GIS in past few years
GIS built on solid foundation
Cultural differences can influence computer work
A better understanding of GIS is required
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29. Summary MNC GIS U.S. is leader in computer use
Four organizational structures
Coordination is the key
Multitude of problems
GIS
Implementation strategies
Consider culture
U.S. is leader in computer use
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