Transnational - The buzz word for today's businesses

Transnational is a term that has been around for a long period of time but off late has become extremely popular.

Transnational Organizations have invested in foreign operations, have a central corporate facility but give decision-making, R&D and marketing powers to each individual foreign market. Simply put a s a corporation or a company that manages the production or supplying services in more than one country. These companies increasingly shape our lives as they weave worldwide webs of production, consumption, finance, and culture. To be able to comprehend the business practices of transnational corporations, a current understanding of global business and current affairs is needed. These companies command enormous financial resources, possess vast technical resources and have extensive global reach. 

Despite their impact in developing economies, however transnational companies are profit-seeking organizations.  Such dual roles of funding and profit seeking have made TNCs object of great controversy.  Do they help or hinder? Do they give or take?

Globalization, particularly the dismantling of trade barriers, has allowed companies to spread widely in search of cost efficiency and to implement integrated production strategies across regions and even continents. Unquestionably, they bring resources of great potential benefit to developing countries but they can take away Business from local industries and can change the economy of the hosting nation. It can also cause a loss of culture and traditional values as more and more people become “globalised”. The profits made by the TNC leave the hosting country creating an outflow of capital (money).

With all these threats to the host country, this trend also causes concern for the home country. In the race of globalizing in the world and learning effective ways of doing business in a foreign land, transnational organization a pose a threat for the home country as it directly affects the jobs there. A lot of such countries might face loss of jobs and revenues due to transnational companies.

So as the world becomes flatter and more n more globalized, it is accompanied by criticism of the current forms of globalization, which are feared to be overly corporate-led. As corporations become larger, multinational or transnational their influence and interests go further accordingly. Today we know that corporations, for good or bad, are major influences on our lives. These companies increasingly shape our lives as they weave worldwide webs of production, consumption, finance, and culture.  In this era, it is for us to try and make corporate behavior more responsible when it comes to ethics, working conditions, environmental sustainability, etc.

It has often been said that the world is a global village. This has never been truer than in the current age, when national boundaries, cultural barriers and even political ideologies can do little to stop the tide of globalization

I guess this is the most exciting time to be in business. The vast array of tools available make it easier than ever and the ability to do business outside the confines of your local geographic area make it really unique and special. You can do things today that business people could only dream of even a generation ago. Today, going global is the ultimate goal of companies.

Without any doubt internet has made the world smaller. It has also created a lot of opportunity for businesses to expand globally. However, any business that hopes to go global needs to be aware of cultural sensibilities. Local cultures, behavior and even languages vary greatly across the world and being aware of exactly what applies in the destination country is critical to starting off on the right foot. A successful business is keen to replicate its success model. Things, however, do not work the same way worldwide. We need a plan, but we should also be able and willing to accommodate local modes of operation. With all this businesses also need local resources. We do not yet live in a single global market and we should not try to pretend that we do. It pays to invest in senior local talent but it comes with existing connections, will provide your growing business with a familiar face that will go a long way in consolidating your overseas presence. Further, this person will also be well aware of all local formalities which will be invaluable to a new business in the initial stages.

The greater trend in 2011 will be companies trying to sell into the rapidly growing foreign economies but to achieve globalization and to establish the company in foreign land we need a foundation of solid research and ground work since there cannot be any shortcuts to reaching the hearts of millions.