Meaning and features of mncs - class-XI

Global market leader is an organization which is recognized as being ahead of the rest of the organizations in the global market in terms of the market share of the organization.

MNC has an international identity as belonging to a particular home country where they are headquartered. A transnational company is borderless, as it does not consider any particular country as its base, home or headquarters. Transnational corporations are a type of multinational corporations.

The global marketing segmentation represents a company's efforts to identify and categorize groups of customers and countries according to common characteristics.

A global organization is creating both type of products, i.e standardized product for a region that sell standardized products and also customized products for customers.

In the last ten years MNC'S have played an important role in the Indian economy. They have become a common feature of most developing economies in the world. 

Top 200 MNC'S control over a quarter of the world economy. Therefore MNC'S are in a position to exercise massive control on the world economy because of their capital resources, latest technology and goodwill.

MNC'S are gigantic corporations which have their operations in a number of countries. They are characterized by their huge size, large number of products, advanced technology, marketing strategies and network of operations all over the world.

Global enterprises are the companies that operate around the world.Through a network of their branches in several countries, global enterprises extend their industrial and marketing operations. Their vision to work across many global frontiers to earn in international currencies of many countries.

MNCs also lead to the growth of monopolies. A multinational corporation (MNC) has facilities and other assets in at least one country other than its home country. Very large multinationals have budgets that exceed those of many small countries.

Global enterprises are characterized by having highly sophisticated research and development departments engaged in the task of developing new products and superior designs for existing products.

Aggressive Market. A market or exchange with a high trading volume. When a market becomes very aggressive, the prices of stocks can go up significantly, which in turn makes it more expensive for a trader to become involved in the market by buying stocks.

Global enterprises does not have any problem in market penetration  because their operations and activities extend beyond the physical boundaries of their own countries. 

Global enterprises have their headquarters in their home country and exercise control over all branches and subsidiaries. This control is limited to the broad policy framework of the parent company.

A restrictive clause is a clause which functions as an adjective to identify the word it modifies. A restrictive clause is essential for the intended meaning. A restrictive clause is not offset with commas.

The globally integrated enterprise is a term coined in 2006 by Sam Palmisano, the then CEO of IBM corporation.

MNC has many disadvantages. It invest in most profitable sectors and disregard the national goals and priorities of the host country. Many domestic industries have to wind up due to the threat of MNC'S. 

Foreign exchange transaction is a type of currency transaction that involves two countries. Generally, a foreign exchange transaction involves conversion of currency of one country with that of another. The conversion of currency in a foreign exchange transaction can be performed.

Home Country in international compensation, this is the country upon which an expatriate's compensation is based. It is usually the expatriate's home country or the country in which the employee's headquarters is located.

Multinational Corporations in developing countries

• Environmental costs. Multinational companies can outsource parts of the production process to developing economies with weaker environmental legislation. For example, there is a trade in rubbish, which gets sent to developing economies like India for disposal and recycling.
• Profit repatriated. Although multinationals invest in developing economies, the profit is reptriated to the location of the multinational, so the net capital inflows are less than they seem.
• Skilled labour. When undertaking new projects, the multinational may have to employ skilled labour from other economies and not the developing economy. This means best jobs are not received by local workers and the investment is diffused.
• Raw materials. A large component of multinational investment in developing economies is seeking out raw materials – oil, diamonds, rubber and precious metals. The extraction of raw materials can cause environmental externalities – polluted rivers, loss of natural landscape.
• Sweat-shop labour. Not all economists are convinced sweat-shop labour is a good thing. Critics argue that weak labour conditions allow multinationals to use their monopsony power and pay lower wages to workers than they should get paid

Host country a nation in which representatives or organizations of another state are present because of government invitation and/or international agreement. Dictionary of Military and Associated Terms.

Business enterprises wants to be international because it has many advantages. It avoids trade barriers which are the rules and regulations that regulates foreign trade and investment. Tarrif is the tax imposed by the government on the import and export of goods. MNC get some relaxation in these tarrifs. Secure, timely and cost effective supply of raw materials is the backbone of any enterprise. MNC can get easy access to the raw materials as it can set up operations where the raw materials are easily found which in turn reduces the production cost.

Apple Inc. is an American multinational technology

Nestlé S.A. is a Swiss transnational food and drink company headquartered in Vevey, Vaud, Switzerland. It is the largest food company in the world, measured by revenues and other metrics, since 2014.

(IBM) International Business Machines Corporation is an American multinational information technology company headquartered in Armonk, New York, with operations in over 170 countries. The company began in 1911 as the Computing-Tabulating-Recording Company and was renamed "International Business Machines" in 1924.

Walmart Inc. is an American multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. Headquartered in Bentonville, Arkansas, the company was founded by Sam Walton in 1962 and incorporated on October 31, 1969.

Advantages of multinational companies. Multinationals create jobs which boosts the local economy and more workers to tax. They bring expertise in that skills of workforce are improved, some may use IT that would never have before or other skills now deemed basic by the western or developing world.