GMS 724 Lecture Notes - Lecture 11: Cost Leadership, Uptodate, Information Technology

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 724
• Professor: Howard Lin

Document Summary

Organizing operations: organizing is the process of creating the structure, systems, and culture needed to implement the company"s strategy. Structure: formal arrangement of jobs within a company that specifies roles, responsibilities, and relationships: vertical differentiation, horizontal differentiation. Vertical differentiation: centralization versus decentralization in organizational design. Centralization: degree to which high-level managers make strategic decisions and delegate them to lower levels for implementation. Where to assign authority is an ongoing negotiation between headquarters and the local subsidiary. In the least, negotiations highlight the fact that an mne is never completely centralized or decentralized. Few organizations could function if senior executives made all decisions. Nor, for that matter, could they function if local managers made all decisions. The idea of dynamic balance, within the context of the mne"s strategy, is the enduring characteristic of vertical differentiation: expanding technologies encourage greater centralization given headquarters" improving ability to track, in real time, global conditions and local performance.