ABSTRACT
The evolution of multinational companies (MNCs) has been characterized by a growing conflict between the requirements for economic survival and success and the adjustments made necessary by the demands of host governments. Faced with the conflict between the economic and political imperatives within a business, MNCs can respond in several ways. This chapter, based on intensive field research of the management processes in about a dozen MNCs, analyzes strategies and administrative processes used by MNCs to reconcile the conflicting economic and political imperatives. It describes MNC strategies to respond to the dual imperatives. The chapter reviews conditions under which MNCs are likely to find one or another strategy most suitable for individual businesses. It then analyzes the interaction between strategies and the nature of internal management processes. The chapter also outlines implications for the management of interdependencies between businesses in diversified multinationals. It explores the means to increase the overall managerial capability of the company.
