Types of Global Governance

Organizational forms are no longer traditional i.e. centered geographically, management dominated or one-size-fits-all. Global competition has changed and polarized the organization types to such that lay emphasis on local commercial partnering wherein regional customer service is important while at the same time large scale investment is made for global brand recognition and multinationalism with insider knowledge.

Broadly there are 4 types of organizational models-

1. DeCentralized- This type of model is typical of a Multinational Corporation in which each national unit is managed as a separate entity & optimises its performance in the respective local environment
2. Coordinated-This type of model considers the management in the parent company as the central unit reaching out to its national units via sophisticated management techniques.Local market conditions however demand adoption of some practices specific to a particular place and national units have some management scope there.
3. Centralized-This form of organizational model has its origin from Japanese firms. Centralized control & decision making allow a truely global mode to the organization as it has a worldwide approach rather than focussing on local markets.It is also known as the ‘Hub Model’
4. Transnational-Spanning across different countries, this type of corporation gives local responsiveness to markets at the same time as implementing a multi-dimensional strategic plan for global capabilities