DIFFERENCES BETWEEN GLOBAL AND TRANSNATIONAL ENTERPRICE

PRESENTED BY; SAHANA.V.S 1PT10MBA37

GLOBAL COMPANIES
Global companies have invested and are present in many countries. They market their products through the use of the same coordinated image/brand in all markets. Generally one corporate office that is responsible for global strategy.

 Some examples of global companies areSeagate, pizza hut, Burger king,TESCO Coca Cola, Procter & Gamble, GM etc

Top Global companies:

Rank Company 2009 2010 revenue(USD Revenue(US million) D Million) $117,400m $114,552m $99,544m Headquarte r Founded in

1 2 3

Samsung electronics HP Hitachi

$123,642m
$96,610m $21,400m $177,570m $35,020m $21,750m $29,764m $26,180m $5,110m

Samsung Town, Seoul, South Korea Palo Alto, California, USA Chiyoda, Tokyo, Japan Armonk, New York, USA Minato, Tokyo, Japan Minato, Tokyo, Japan Kadoma, Osaka, Japan

1969

1939 1910 1896 1946 1939 (merging)

4
5 6 7

IBM
Sony Toshiba Panasonic

$95,750m
$79,618 $76,667m $79,388m $61,101m

8
9

Dell
Foxconn

Round Rock, Texas, 1984, November 4 USA Tucheng District, New Taipei City, Republic of China

$59,323m

1974

Example of the Global Company:

 New York, March 9 (IANS) Apple Computer, the maker of iPhone, iPod and Mac PCs, has topped 20 most admired global companies in a list prepared by Fortune magazine. PepsiCo, headed by India-born Indra Nooyi, at 13th position is more admired than archrival Coca-Cola at 19th spot, according to the list published in the latest edition of the US business magazine, framed for its authoritative Fortune 500 lists of US and global corporations ranked on gross revenue. Apple in the most admired list is followed at second place by General Electric, the diversified industrial conglomerate, while Japanese auto major Toyota occupies the third place.

Transnational Company:
A firm which owns or controls production facilities or delivers services in more than one country through direct foreign investment. The specialized resources and capabilities are dispersed among the various operating units globally. Transnational are made possible by improved international communications which provide rapid transshipment and foreign travel, easy communication of information, and international mobility of capital.

TRANSNATIOANAL COMPANIES
Transnational Corporation as define by UN is globally integrated organisation with entities in two or more countries. Decision making system permitting coherent policies and common strategy through decision making centre. Entities are so linked by ownership so as to exercise influence over others and share knowledge.

 An example of a TNC is Nestl who employ senior executives from many countries and try to make decisions from a global perspective rather than from one centralised headquarters.

2008
Fortune Magazine
July 21, 2008 This is a table of the top 10 corporations from the Fortune Magazine's Global 500 list. RANK COMPANY REVENUE (IN MILLION $) PROFITS (IN MILLION $)

1
2 3

Wal-Mart Stores
Exxon Mobile Royal Dutch Shell

378,799
372,824 355,782

12,731
40,610 31,331

4
5 6 7 8 9 10

BP
Toyota Motors Chevron ING group Total General motors Conoco Phillips

291438
230,201 210,783 201,516 187,280 182,347 178,558

20,845
15,042 18,688 12,649 18042 -38,742 11,891

Example of transnational company: Nokia

Nokia is currently the number one manufacturer of mobile devices in the world. . 38% in 2007 and with net sales of up to 51.1 billion Euros, theres no doubt about the companys significance and success. . From Africa to the Asia Pacific to Europe, Latin America, Middle East and North America, Nokia provides us with cellular phones that are both stylish and functional. . Though their marketing strategy is worldwide and their products basically uniform, the company is transnational because of the conscious effort they put into understanding the different needs and tastes of their consumers all over the world. . In line with this, Nokia has a team of design researchers, psychologists, sociologists and usability experts who travel the globe exploring how people use their mobile devices, discovering how to make them better, how to reach the billions of people who don't own a phone - and learn a whole lot about people along the way.

Apple Vs Nokia

International Corporate Strategy

When is each strategy appropriate?
High

Global Strategy Need for Global Integration

TransNational strat -egy

Low Low High

Need for Local Market Responsiveness

Differences Between Transnational and Global Companies:

Transnational company
A multinational venture centrally managed from one country.

Global company:
A global network of productive units with a decentralized authority structure and no distinct national identity. Relies on a blend of global and local strategies. Various operating units are interdependent and integrated and have large flows of components, products, resources, people and information among them.

Has global strategies for product design, financing, purchasing, manufacturing, and marketing. The operating units are independent of each other, since decision making power is given to all the units.