Organizational Implications of Globalization

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The concentration on organizational implications of globalization leads to the general question of how firms should change their organizational design in order to meet the demands arising from a global approach as described in the previous chapter1. Since the expansion of firms into foreign countries already imposed considerable changes to domestic firms, the problem of organizational design in the international context is far from being new. Forthcoming, it appears useful to analyze the existing literature on organizational design to identify the extend to which reliable and established mechanisms of organizational adjustment offered in literature can be applied to the developed discussion (Chapter 5.1). In Chapter 5.2, the prevailing ‘structure follows strategy’ paradigm will be subject to a critical reflection with respect to extent to which conventional thinking about organizational adaption is adequate for the conceptualization of emerging organizational requirements of global firms. Chapter 5.3 then provides a review of the global network debate. The discussion about networks centers around alternative models which are proposing new pattern of how global firms should organize. Finally, the global network debate will be synthesized according to its major characteristics (Chapter 5.4).