Successful transnational companies see themselves as separate, nonnational entities.
Most companies doing international business today are still organized as traditional multinationals. But the transformation into transnational companies has begun, and it is moving fast. The products or services may be the same, but the structure is fundamentally different. In a transnational company there is only one economic unit, the world. Selling, servicing, public relations, and legal affairs are local. But parts, machines, planning, research, finance, marketing, pricing, and management are conducted in contemplation of the world market. One of America’s leading engineering companies, for instance, makes one critical part for all its forty-three plants worldwide in one location outside of Antwerp, Belgium—and nothing else. It has organized product development for the entire world in three places and quality control in four. For this company, national boundaries have largely become irrelevant.
The transnational company is not totally beyond the control of national governments. It must adapt to them. But these adaptations are exceptions to policies and practices decided on for worldwide markets and technologies. Successful transnational companies see themselves as separate, nonnational entities. This self-perception is evidenced by something unthinkable a few decades ago: a transnational top management.
ACTION POINT: Ask the foreign technical-support center for your U.S.-purchased computer or printer a question about the operation of your equipment. How does the quality of this support compare with that of your local cable company?