Luthans and Doh 2012 describe four strategic predispositions

Luthans and Doh (2012) describe four strategic predispositions and they discuss Doing Business in each of the following countries:
a. China
b. Russia
c. India
d. France
e. Brazil
f. Arab countries

Match each strategic predisposition with at least one country or culture. Briefly describe why you feel each strategic predisposition appropriately matches the country or culture you selected.

Your response should be at least 500 words in length.

Solution

Many MNC have cultural strategic predisposition for doing certain jobs in a specific way. Luthans and Doh have identified 4 distinct predispositions: ethnocentric, polycentric, regiocentric and geocentric.

Ethnocentric is one that prevails in USA, Russia and France. Such predisposition is a philosophy of nationalistic style management in which the values and benefit of the parent company helps out such strategic decisions. Such strategic predisposition is basically profit motive. Such strategy also relates to Global integration. French people are generally suspicious in nature for quick friendship and this is why they prefer their own people to manage the subsidiaries in other countries. The strategy is basically top down hierarchy which generally prevails in countries like France and Russia. This can be proved that the world wide industry standard for an MNC is adjusted to the requirement of such country. Also this is true, as People of home country are developed to hold key positions in many countries in the world.

Polycentric is one that prevails in china and brazil. When strategic dispositions are adjusted to suit the cultures such countries where the MNC operates, the Polycentric predisposition is a philosophy of management. The major features include the wide acceptance of such organization by the public, bottom-up hierarchy and Hierarchical area divisions, with independent national units. Countries like China and Brazil features the same. Also the marketing strategy of local product development based on local needs which is a part of polycentric disposition prevails in such country. This match is relevant also because in this type of predisposition, people of local nationality developed for key positions in their own country. Therefore the culture of host country is followed which makes it as polycentric.

Regio-centric prevails in countries like Brazil, Australia, India and Arabs. The firm tries to match its own objectives with those of its subsidiaries companies on a regional basis which makes it a Regio- centric predisposition is a philosophy of management. The basic motive of the same is both profitability and public acceptance. The governance of such companies are mutually negotiated between country and its subsidiaries. We match countries like Brazil, Australia, India and Arabs as the strategy follows up by regional integration and national receptiveness. The structure will have product and regional organization is matched through a prevailing conditions. Such countries follow up with the regional culture which again is the feature of region-centric. In such countries marketing is done within region standard, but not across regions.

Geocentric is one that prevails in almost whole world specially Arabs. The mission is again profitability and public acceptance for such strategy. The governance in such organizations are mutually negotiated at all the levels of such corporation. These organization shows global integration and network of organizations. The Arabs are generally god fearing and in commercial organization they feel that the top position has the ultimate power and hence they follow geocentric predisposition. The marketing in such countries is done for global products with variations as per local needs. The human resource strategy features the most efficient people almost everywhere in the world to build up key positions in global scenario.

Reference :

Book : International Human Resource Management   By Nilanjan Sengupta

International Management: Culture, Strategy, and Behavior
by Fred Luthans and Jonathan Doh