1. The connotation of international enterprises
Transnational Corporation, also known as Multi-national Enterprise, International Firm, Supernational Enterprise) and Cosmo-corporation, etc. In the early 1970s, the United Nations Economic and Social Council formed a group with the participation of eminent persons. After a relatively comprehensive examination of various norms and definitions of transnational corporations, a resolution was made in 1974, deciding that the United Nations would uniformly adopt the term "transnational corporations". name.
Refers to an international large-scale enterprise composed of economic entities from two or more countries and engaged in production, sales and other business activities. Also known as international companies or multinational companies. The prototype of multinational corporations first appeared in the 16th century and grew after the 1870s. It has become an important content, manifestation and main driving force of the internationalization and globalization of the world economy. The main characteristics of multinational companies are: 1. Generally, there is a large and powerful company in a country as the main body. Through foreign direct investment or the acquisition of local enterprises, it has established subsidiaries or branches in many countries; 2. There is generally a A complete decision-making system and the highest decision-making center. Although each subsidiary or branch has its own decision-making body, each can carry out decision-making activities according to its own business fields and different characteristics, but its decisions must be subject to the highest decision-making center; 3 , generally arrange their business activities based on global strategies, seek markets and reasonable production layouts around the world, specialize in production at fixed points, and sell products at fixed points in order to maximize profits; 4. Generally, because of their strong economic and technological Strength, rapid information transmission, and rapid cross-border transfer of funds, etc., so they have strong competitiveness in the world; 5. Many large multinational companies have strong economic and technical strength or in the production of certain products. advantages, or have varying degrees of monopoly on certain products or in certain regions.
2. Characteristics of international enterprises
1. Multinational companies have global strategic goals and highly centralized and unified management
Multinational companies have relatively large domestic and foreign assets. Companies with multiple branches and engaged in global production and operation activities have some differences compared with domestic enterprises. These differences are reflected in:
1. The strategic goals of multinational companies are oriented to the international market and aim to maximize global profits, while domestic enterprises are oriented to the domestic market.
2. Multinational companies control foreign companies through holdings, while domestic companies mostly control their less foreign-related economic activities through contracts.
3. The foreign-related activities of domestic enterprises do not involve the establishment of economic entities abroad. The relationship between domestic and foreign economic activities is loose and highly contingent. Their foreign-related economic activities are often terminated immediately after the transaction is completed. , no longer participate in the future reproduction process; while multinational companies comprehensively carry out trading activities such as capital, commodities, talents, technology, management and information in various fields around the world, and this "package" activities must be in line with the company's overall strategy The target is under the control of the parent company, and its subsidiaries also participate in the local reproduction process like foreign enterprises. Therefore, multinational companies must implement highly centralized unified management of their branches.
2. Multinational companies engage in integrated diversified operations
(1) The forms of multinational companies engaged in integrated diversified operations
1. Horizontal horizontal diversified operations business. Such companies are mainly engaged in the production and operation of a single product. There is little professional division of labor between the parent company and its subsidiaries, but the amount of intangible assets such as production technology, sales skills, trademarks and patents transferred within the company is relatively large.
2. Vertical diversification. Such companies can be divided into two types according to their business content. One is that the parent company and its subsidiaries produce and operate products in different industries but related to each other. They are cross-industry companies, mainly involved in the production and processing of raw materials and primary products, such as mining and planting → refining → processing and manufacturing → sales and other industries.
The other is that the parent company and its subsidiaries produce and operate products with different processing levels or stages in the same industry, mainly involving industries with a high level of specialized division of labor such as automobiles and electronics. For example, Mobil Oil Company in the United States is the former vertical multinational company. It engages in the exploration and extraction of oil and natural gas on a global scale, transports oil and natural gas through pipelines, oil tanks, and vehicles and ships, operates large refineries, and refines crude oil. Produce final products, wholesale and retail hundreds of petroleum derivative products. France's Poirot Citro?n Automobile Company is the latter type of vertical multinational company. It implements a professional division of labor within the company. It has 84 subsidiaries and sales agencies abroad, which are engaged in molding, casting, engines, gears, and reducers. , mechanical processing, assembly and sales, etc., to achieve vertical integration of production and operations.
3. Mixed diversification. Such companies operate a variety of products. The parent company and subsidiaries produce different products and operate different businesses, and they are not connected to each other and have no necessary connection. This is the case for Japan's Mitsubishi Heavy Industries. It was originally a shipbuilding company, but later changed to a mixed business. Its business scope includes: automobiles, construction machinery, power generation system products, shipbuilding and steel components, chemical industry, general machinery, aircraft manufacturing, etc.
(2) Reasons why multinational companies attach importance to diversified operations
1. Enhance the overall economic potential of monopoly enterprises, prevent the formation of "excess" capital, ensure the safe development of multinational companies, and have Conducive to the realization of global strategic goals.
2. It is conducive to the reasonable flow and distribution of funds and improves the utilization rate of various production factors and by-products.
3. It is convenient to spread risks and stabilize the economic benefits of enterprises.
4. You can make full use of the remaining production capacity, extend the product life cycle, and increase profits.
5. It can save contract expenses and enhance corporate flexibility.
2. Promote the development of multinational corporations by developing new technologies
Since the war, the world’s new technologies, new production processes, and new products have basically been in the hands of multinational corporations. , this is one of the fundamental reasons why multinational companies can continue to grow and develop for decades. Usually multinational companies invest a lot of manpower and material resources to develop new technologies and products. For example, in the mid-to-late 1980s, the AT&T Research and Development Center had an average annual research funding of US$1.9 billion and employed 15,000 scientific researchers, 2,100 of whom had received doctorates, and 4 of whom had won 4 Nobel Prizes. Physics Prize. Another example is the well-known 3M Company. In the summer of 1994, nearly 400 types of semi-assembled hardware products were newly launched. New products emerge in an endless stream. The reason for this is explained by the marketing manager of the DIY product department of 3M Canada Branch: The company's annual turnover 7% of the total is spent on developing new products. The business objective is that 30% of sales revenue must come from new products that were not launched 4 years ago. This shows that his research is advanced. Multinational companies not only focus on developing new technologies, but are also very good at obtaining high profits through transferring technology to foreign countries and exercising control over branches and subsidiaries.
3. Competition is the main means for multinational companies to compete for and monopolize foreign markets.
In international trade, the traditional means of competition is price competition. That is to say, enterprises reduce production costs and use prices lower than those of similar products in the international market or other enterprises to combat and exclude competition in foreign markets and expand product sales. Nowadays, due to the improvement of living standards around the world, especially in developed countries, the increase in the proportion of durable consumer goods expenditure in total expenditure, continued inflation around the world, resulting in continued price increases, and the general shortening of product life cycles, price competition has It has been difficult for multinational companies to win the most customers, and non-price competition has replaced them. Facts have proved that non-price competition is the main means for contemporary multinational companies to monopolize and compete for the market. Non-price competition refers to improving product quality and performance, increasing color and variety, improving product packaging, decoration and specifications, improving pre-sales and after-sales services, providing preferential payment terms, updating trademarks, strengthening advertising and ensuring timely delivery, etc. To improve the quality, reputation and popularity of products, to enhance the competitiveness of goods and expand the sales of goods.
At present, multinational companies mainly improve the non-price competitiveness of goods from the following aspects: ① Improve product quality and overcome technical barriers to trade; ② Strengthen technical services, improve product performance, and extend the service life; ③ Provide credit; ④ Accelerate product upgrades and continuously Launch new products and update designs and varieties; ⑤ Continuously design novel and diverse packaging and decoration, paying attention to the "personalization" of packaging and decoration; ⑥ Strengthen advertising and vigorously research and improve advertising and sales techniques.
4. Diversified business methods of multinational companies
Compared with ordinary domestic enterprises or general foreign-related companies, multinational companies have obviously more global production and business methods, including import and export. , licenses, technology transfer, cooperative operations, management contracts and the establishment of overseas subsidiaries, etc. Among them, the main form of establishing overseas subsidiaries is to develop and expand its global business.
3. The strategic thinking is: implement the strategic goal of globalization.