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MNCs (Multi National Corporations)

Presentation By:Utkersh Sharma Varun chaudhary Vinay Kumar Vineet Kumar Yogendra Kumar Abhishek Chaudhary - 2007ECS036 - 2007ECS037 - 2007ECS038 - 2007ECS039 - 2007ECS041 - 2007ECS042

M.B.A. Integrated with B.Tech (C.S.E.)

Introduction of MNCs

Multinational corporation is one that


Operates in many countries Carries out research ,development and manufacturing in those countries Has a multinational management

Has multinational stock ownership

According to the president, IBM corporation


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Characteristics of MNCs

Giant size Oligopolistic Nature Collective Transfer of Resources International operations

M.B.A. Integrated with B.Tech (C.S.E.)

Factors Responsible for their growth

Product innovations
Expansion of market Market superiorities Financial superiorities

M.B.A. Integrated with B.Tech (C.S.E.)

Types of MNCs
On the basis of investment Associate Subsidiary Branch On the basis of operations Horizontally integrated multinationals Vertically integrated multinationals Diversified multinationals On the basis of management orientation Ethnocentric Polycentric Regiocentric Geocentric

M.B.A. Integrated with B.Tech (C.S.E.)

Impact of MNCs on host Economies


Positive effects of MNCs
Bring in FDI Transfer of Technology Improvement of the host country s balance of payment Creation of local job and career opportunities

Promote competition and better utilization of available resources in the local economy Promote Research & Development Benefit Customers Promote exports in the host economies
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Negative effects of MNCs


Influencing host-country government decisions Transfer of inappropriate technology Dumping of obsolete technology Exploitation of host country resources Promote unhealthy market competition Promote hostile mergers and acquisitions Crowding out domestic entrepreneurship

M.B.A. Integrated with B.Tech (C.S.E.)

Role of MNCs in Indian economy


Create more jobs Increase economic prosperity Improve living condition Set up production jointly with some of the local companies. Joint production Provides money for additional investment and latest technology for production. Buy up local companies and then expand production. Place orders for production with small producers.

M.B.A. Integrated with B.Tech (C.S.E.)

Indian Companies
Country rank Company 2011 1 Indian oil 98 2010 125 Indian companies Under Global 500 Rank 2009 105 2008 116 2007 135 Revenue($ Million ) 2011 City

68837

New Delhi

Reliance industries

134

175

264

206

269

59900

Mumbai

Bharat Petrolium State Bank of India Hindustan Petrolium

272

307

289

287

325

34102

Mumbai

292

282

363

380

495

32450

Mumbai

336

354

311

290

336

28593

Mumbai

6 7

ONGC Tata Steel

361 370

413 410

402 258

335 315

369

26945 26065

Dehradu n Mumbai

M.B.A. Integrated with B.Tech (C.S.E.)

Measuring the extent of MNCs Internationalization

Size
Structure Performance

Management orientation

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Features of MNCS in India


Major MNCS Bi-country Trends in growth of Mncs

Origin of Mncs
Industry wise distribution of Mncs Sources of capital

Regulation of Mncs
Profitability Increase in number subsidiaries Obsolete technology Foreign exchange drain
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Harmful effects of the operations of the Mncs on Indian economy

Outflow of large sums of money Heavy damage to economy Political interference Faulty technology transfer

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THANK YOU

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