Control, change, and flexibility: the dilemma of transnational collaboration

In this chapter the authors develops a logical comparison between the multinational management challenges faced in fully-controlled businesses and the difficulties faced in businesses which rely on international partnerships for their international development. Based on their past research on multinational management, they establish the need for three capabilities to develop a successful strategic management process in multinational companies. These are strategic control, strategic change, and strategic flexibility. These three capabilities are the keys to the strategic management process in a multinational business. Strategic control over partnerships without a joint venture or consortium arrangement is even more problematic. In the absence of the joint financial optimization structure provided by a joint venture, the high uncertainty and need for specialized assets make enduring co-operation difficult. In multinational companies (MNCs), the flexibility required by the dual needs for integration and responsiveness is achieved by creating an advocacy process within the company, between managers who are most sensitive to various aspects of the environment.