in a course on global marketing, it is imperative that you know about different
ID: 1135643 • Letter: I
Question
in a course on global marketing, it is imperative that you know about different types of organizations that operate globally.
a)Identify, define and explain in substantive detail the different types of organizations based on the EPRG (Ethnocentric, Polycentric, Regiocentric, and Geocentric) framework.
b)Although there are many different categorizations of companies , define a global corporation. Is a global company same as or different from a firm described as a geocentric organization?
c)Identify and explain in substantive detail the characteristics that manifest a global company. (You may conduct additional research and use external sources
Explanation / Answer
Due to the affect of globalisation, recruitment has also crossed all limits & borders and has employed people with global organisations located in different continents of the world. It has become mandatory to understand global organisations along with management operations and orientation worldwide. International Management orientation is the perspective of businesses and staff of an organisation, of the world at large. Howard Perlmutter defined alternative management orientation through the EPRG model as an accurate way of classification of this orientation.
(1). Ethnocentric people or companies perceive their home country to be superior to the rest of the world. This substantially impacts their view of markets which they decide to enter, causing them to rely on their knowledge and beliefs resulting in expectation of similarity with their own country throughout the world. It may be tending to consideration of offices of foreign subsidiaries or franchises overseas in international markets as having lesser importance then those in the home country. These companies tend to ignore opportunities available in foreign countries anyhow fail to succeed due to lack of ability to adapt or accept and abide by foreign culture or accurately assess foreign markets. Such companies are referred to as domestic company within the nation and when they do business in foreign countries they can be referred to as International Companies.
(2). Polycentric organisations or individuals tend to view each country as a separate Unique Identity and believe that it is best to run businesses locally. Polycentric organisations head office maintains minimal control on the activities of subsidiaries in each market and the management is more of a silo type, each unit being an independent segregated identity with no networking available to facilitate sharing of the good ideas and practices of one market being implemented in another. This type of Management strictly believes that every country has a unique culture requiring and absolute imitation by the business to succeed by developing a unique strategy absolutely suited to that culture and country. Such companies are defined by the term multinational company.
(3). Regiocentric organisation perceives the entire world with the view to identify similarities and differences that exist as compared to the domestic culture and country. It then builds all strategies around such identified similarities and differences. Nations may be within the same region but exhibit what's differences in culture, climatic conditions, transportation, business organisations, distribution networks and so on. Regiocentric companies maybe interested in business within countries in the same region exhibiting required similarities such as member nations of nafta or of Asean.
(4). Geocentric companies or individuals truly Global organisations which tend to view the entire world as a potential Marketplace having seamless opportunities for growth and expansion. These companies have managements ready to exploit the potential within any country in domestic and international markets as it has the required agility and adaptability. its perception is a combination of ethnocentric and polycentric, with the ideology being to think globally but for optimal exploitation of local opportunities it acts locally. It amalgamates ethnocentrism and polycentrism into a world view by an accurate perception of similarities and within Markets and countries worldwide thereby formulating an effective Global strategy which is responsive to local needs but with an eye on maximization of profits may have a global supply chain and procurement policy. European Silicon structures is an exemplary definition of geocentric organisation.
Geocentric organisational culture is the culture of global organisations as it tends to perceive entire world on equal terms without any discrimination. Due to this they are highly adaptable and create centers of Excellence interconnected through an extensive network which facilitates cooperation and coordination within all units by imitation of good practices and ideas of one center within another center with effective implementation through required modification for ensuring absolute suitability for local requirements. These corporations exhibit extensive adaptability rendering them at par with other domestic local organisations. The take on the identity of other local organisations to become a part of the economy but maintain a global strategy, perception and planning to exploit all available opportunities for Optimisation. Such organisations also have the ability to successfully implement ambidexterity by pursuing innovation and new market opportunities while successfully exploiting available market opportunities. This is achieved through creation of not only a world organisation but world citizens within all employees and individuals connected with the organisation to enable them to dilute National identity to do on a global identity and feel one with all people and at home in any Nation within the world. This is achieved by modification of individuals and employees to adopt a world oriented view by transcending all cultural differences through development of attitudes and values which are comprehensive and compelling while being universally accepted and applicable. This requires the development of a global mindset which is ability to perceive beyond self, culture, nation division or function to adequately develop the ability to balance both local and global. Global values result in great satisfaction in what one does & creates a sense of purpose by implanting cultural sensitivity, global thinking. This also creates global leaders whose skills, management and qualities lead them in being among the world's most reputed and respected global citizens.
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