Hub 9 pt 4 Control shareholders and organizational design

Question 1

what happens if outside shareholders control the affiliate? ( who does it affect, whats filled)

Answer 1

they can block efforts of IC headquarters to move production factors away, fill an export order from another affiliate or
subsidiary, etc.

Question 2

what happens if outside shareholders are a minority and cant direct control the affiliate?

Answer 2

they can (still) bring pressures on the IC to prevent it from diminishing the affiliate ’s profitability for the enterprise’s benefit .

Question 3

Indirect control:With limited or No ownership

With less than 50% of the voting stock and even with no voting stock, an IC can have control (pressure IC HQ) through: 4 things

Answer 3

1. management control
2. control of the technology
   3.control of finance
3. putting people from the IC in important executive positions

Question 4

reporting:
for decsion making and cotrol of organizational resources to be effective, all operating units of an International Companies must provide HQ with timely, accurate, and complete reports including: 4 things

Answer 4

1.financial
2.technological
3.market opportunity
4.political and economic reports