Challenges in Managing Multinational Company Essay Example for Free

Challenges in Managing Multinational Company Essay Assalamualaikum, One of the common challenges faced by Malaysian multinational company is cultural diversity. Culture is the learned, shared way of doing things in a particular society. It is the way, for example in which its member eat, dress, greet and treat one another, teach their children, solve everyday problems, and so on ( Schermerhorn, Hunt, Osborn 2003). Cultural diversity in workplace refers to the range of differences between individuals in an organization. It affects the way in which people feel, think and act, and frequently, people either refuse to see it, or dont want to see it. People from different countries always have different tradition and attitudes towards business. Some company decides to expand their organization globally but unsuccessful because they fail to realize one important thing. They do not change their organization to adapt to the new country. Malaysian multinational company can be successful if they evolve into a diverse organization which employs people from diverse culture. An international company needs to understand the host market. In order to have better understanding of host market, an international market needs to employ locals. Hence, in employing local resident international organization opens its doors to cultural diversity. When cultural diversity is not properly managed, it caused problem, misunderstandings, and conflicts will arise. I believed that to make Malaysian multinational company successful, it is important that they embrace the fact that the world today has no boundaries. Cultural diversity in workplace and elsewhere should be respected. Employees skills, talents, ideas, and values must be developed and improved. An organization must be able to capture the energy and ideas of all mployees in order to meet the challenges of the competitive marketplace. I also believed that Malaysian multinational company can be successful when it comes to managing diversity if they managed to bring people together from different cultural backgrounds and form a collaborative group. As future manager, the key to manage the cross-culture challenges is through developing respect for every person, regardless of his or her cultural background. They should also learn to be more open-minded. Instead of Judging people, they must learn to accept that every individual is unique and everyone can contribute to the success of the organization. Advancement in science and technology and the liberalization of trade under the Asean Free Trade Area and World Trade Organization (WTO) create an economic opportunity as well as new challenges to Malaysian multinational company. Malaysian nowadays is emerging towards a technology-driven and high-tech production-based pattern of development in order to meet the challenges of the competitive global marketplace. Although Malaysias competitiveness rating has improvements. The availability of skilled human capital in Malaysia is not sufficient for technological development to progress. Malaysian school and universities do not turn out to be problem solver and do not produce skilled, innovative graduates as technology companies demanded. Compare to China and India which produce tens of thousands of graduates per year, while Malaysias talent pool is tiny in comparison. Companies that do not keep up with technological changes soon will find their business outdated. This will result on missing new products and market opportunities. Demographic is the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics. The demographic environment is a major interest to marketers because it involves people and people make up market. The worlds population is growing at a very high rate. The worlds large and diverse population uncovers great opportunity as well as challenges. Thus, for Malaysian multinational company to enter certain market, they must keep close tracks on demographic trends and development in their market, both home and abroad. In example, if Malaysia multinational were to enter Indian market, they need to understand the trends and dramatic changes in demographic data in determining arketing decisions, to identify opportunities and to anticipate declining demand. The continuously increasing urbanization, rapid growth and use of electronic media have brought changes to the lifestyle and consumption attitudes in urban areas in India, known as middle-class population which has made some essential socio- economic changes -rapidly increasing emphasis on higher professional education, family system from Joint families to nuclear families (BiJapurkar,2007) and exposure to western lifestyle and customs. These factors created increasing demands of ariety quality of products and services, in example, branded clothing, restaurant, home appliances, travel, and so on. In some countries, government interference affects the operation of the multinational companies. It is a challenge that Malaysia multinational company has to face in the direction of going global. Conflicts and misunderstanding between multinational company and host country government has occurred in recent years.. Government interference takes the form of tariffs, quotas, and other non-tariff restrictions. The threat of nationalization (forcing a company to sell its local assets to the government or to other local ationals) or changes in local business laws and regulations can limit a multinationals power. Examples can be taken from the case of China restriction towards multinational company. According to New York Times, companies that have operated exclusively in China for years are being targeted with discriminatory policies. Contracts involving state secrets or business secrets are reserved for Chinese companies and Chinese bureaucrats have been given broad latitude to exclude companies with foreign owners even if the company has been set up in China and have all of its operations in the country. Tenggiling Puitis a. m. n