Abstract:

According to Kriger (1992), the 1980s represented a particularly fertile period for the study of the MNC as an organization. The formulation of the integration-responsiveness framework by Doz and Prahalad (1991) spurred research on the organizational design of MNCs. The basic argument of this framework is organizational design. MNCs are facing two orthogonal sets of environmental forces that create a need for an organizational design that fit with the environmental forces (Richter, Wojciechowski, & Hansmann, 2011). In the last decades, however, the world and the environmental forces have changed substantially. The market has increased in volatility and the shocks the organization receives from the outside are increased. Richter et al. (2011, p. 8) pointed out that “The adequate organizational structure to be chosen heavily depends on the company’s economic environment.” 

The question arises as to what the organizational mechanisms that make MNCs more resilient really are. Richter et al.’s suggestion cannot be implemented unless the conditions that make MNCs resilient are identified. MNCs that are resilient and able to successfully adjust and thrive in conditions of adversity must share some similarities. The relentless forces of competition and globalization are forcing MNCs to divide their activities and reach for foreign inputs, markets and partners. By dividing their value chain into discrete pieces, MNCs can reap the benefit of each of the pieces.