Question

Explain the four basic predispositions that MNCs have toward their international operations. Discuss the extent to which each disposition might allow the MNC to adapt and adjust to cultural pressures in host countries and give specific examples to support your discussion.

Answer 1

Answer:

The four basic predispositions that MNCs have toward their international operations are as below

· Ethno-centric Predisposition : the ethnocentric predisposition the MNC have towards their international operations is that the key strategic decisions will be taken by the parent company based on the value and interest of the parent company in the MNC at any foreign location. Thus the culture of the company is influenced by the parent company’s working culture. Example – the Ethical strategical approach at the foreign national location will be as per parent company.

· Poly-centric Predisposition: the polycentric predisposition the MNC have towards their international operation is that the strategic decisions will be made and implemented such that they will be suitable to the culture of the nation where the operations of MNC are happening. The poly centric predisposition will ensure that MNC show key attention in their strategic to maintain the working culture of the foreign location of operations. Example – MNC’s strategic approach to maintain the culture of the foreign nation in their international operations.    

· Regio-centric Predisposition: the region-centric predisposition the MNC have towards their international operation is that as per regio-centric predisposition the MNC manages its interest with the interest management of their subsidiaries in that region and these are driven through the focus on the regional cultural factors that could have significant impacts on the MNC. Thus the regional culture creates influences over the MNC in their operations at foreign nations and this is being accepted by MNVC with their regio centric pre disposition approach.

· Geo-centric Predisposition: the geo-centric predisposition the MNC have towards their international operation is that as MNC will develop the global system which can be used for making the global business decision and exploring recruitment process such that they can make the hiring at global level and can be placed at any geo location in the international operations. MNC adapts in this predisposition approach and make the suitable cultural changes so that they can implement this approach effectively in the foreign nations.