Question

Country of origin can strongly influence a firm’s approach to organization structure. As MNEs from China and India internationalize, to what extent are they likely to differ from Japanese, European, and U.S. MNEs?

Answer 1

As MNEs from China and India internationalize, to what extent are they likely to differ from Japanese, European, and U.S. MNEs?

• China and India have highest number of population in the world
• Presence of abundant workforce makes it easy for organisation to replace the employees easily
• These countries have more of hierarchical structure as there are more people ready to work under someone
• Indian and Chinese organisations like to delegate the responsibility to other employees and this does not cost them much, because of abundant workforce ready to work for less
• On the other hand Japanese, European, and U.S. MNEs have more of centralized structure due to scarce workforce
• Japanese, European, and U.S. MNEs tend to be choosy with workforce as employees demand higher salary
• Japanese, European, and U.S. MNEs tend to outsource most of their work to India and China due to cheap labour in these countries