Analysis of Multi-National Entity

RUNNING HEAD: ANALYSIS OF MULTI-NATIONAL ENTITY 0
Analysis of
Multi-
National
Entity
September 17
2019
Student’s
Details-

ANALYSIS OF MULTI-NATIONAL ENTITY 1
Executive Summary
Analysis of the multinational entity is crucial for the business as it provides the ways to achieve
the global trends and attaining long term success. Doing internal business as MNE helps a
company to reach larger segments of the market and also exploring the new ways in which it can
attain knowledge and expertise which it can use for the smooth functioning of the operations.
The main aim of the report is analyzing the options of the foreign market entry and to understand
the importance of the knowledge and innovation into the international business. For the
secondary research, journal articles, academic books and website sources are used. Thus. The
results of the report are helpful in making a clear understanding the aspects of multi-national
entity and the importance of knowledge and innovations which are the crucial aspect of
international business.

ANALYSIS OF MULTI-NATIONAL ENTITY 2
Contents
Introduction......................................................................................................................................3
Foreign Entry Strategy.....................................................................................................................3
Franchising the Brand..................................................................................................................3
Direct Exporting...........................................................................................................................4
Joint Venture................................................................................................................................4
Mergers and Acquisitions............................................................................................................4
Wholly owned Subsidiaries.........................................................................................................4
Contract Manufacturing...............................................................................................................5
Competitive Dynamics....................................................................................................................5
Market Conditions........................................................................................................................6
Organization Structure.....................................................................................................................7
Knowledge Management.................................................................................................................8
Innovation........................................................................................................................................9
Conclusion.....................................................................................................................................11
References......................................................................................................................................12

ANALYSIS OF MULTI-NATIONAL ENTITY 3
Introduction
Multi-National Entity is said to be an entity that has operations in various countries. Such kinds
of companies or entities usually have centralized office in one country having different
production chains in various countries that are functionally differentiated (Bos, et al., 2017).
MNE exist with the idea of internationalizing the productions in order to perform global
operations. When a company globalizes their products and attempts to enter into a foreign
market, then it has to look for various aspects of the country the company wishes to enter
(Clegg, et al., 2018). It includes the strategies that the MNE chooses in order to cope with the
competition into the foreign market. Here, the report clearly identifies the foreign market entry
options that the selected MNE has for entering into the foreign segments. The selected MNE is
BHP Billiton which is one of the major mining companies of Australia having headquarters at
Melbourne. The report analyzes the competitive dynamic and market conditions of BHP Group
and also the organization structure, knowledge management and innovation that the company
can utilize for the purpose of entering into the foreign market.
Foreign Entry Strategy
Foreign entry strategy is adopted by the Multi-National Entity in order to make a step towards
the doors of the foreign markets. It is concerned with the selection of the appropriate mode for
entering into the foreign market (Ang, et al., 2015). The entry mode selected have the cost and
risk associated with it. Similarly, when BHP Billiton wants to enter into the foreign markets, it
has to select a mode of entry by taking into consideration the risk and the degree of control
which can be exercised over them. The following are the foreign market strategy that a company
can adopt:
Franchising the Brand
Franchising is used by a company in two ways and can act as a franchisor and franchisee. As a
franchisor, the company can get their brand recognized into the market that the company is
interested to come into (Madanoglu & Castrogiovanni, 2018). Also, as a franchisee, the
company can use the existing business model and attempts to have direct stake into the business.
However, BHP as in the mining industry has made contracts with the financial counterparties,