Changing multinational corporation — nation state relationship: The case of IBM in India

Toward a critical framework for understanding MNE operations: Revisiting Coca-Cola’s exit from India

“…Third, multi-activity companies in both high-tech and trading businesses could retain 51% foreign equity. Fourth, purely export oriented companies were permitted to retain 100% foreign equity (FERA, 1973;Negandhi and Palia, 1988).…”

“…When we do so, we find that the two basic assumptions-namely, (a) GOI's alleged demand for the secret concentrate formula and (b) GOI's supposed requirement that Coca-Cola become a junior partner in a joint venture-which provide the foundation for various accounts appearing in US newspapers as well as IB textbooks, are unwarranted and cannot be justified. A careful examination of the empirical details indicates that (a) the GOI neither demanded the secret concentrate formula for itself nor did GOI insist that an Indian partner be given the formula, and (b) that the GOI did not require Coca-Cola to become a junior partner: in other words, the 60% equity required to be held by Indian shareholders as per FERA could be widely dispersed among the Indian public, leaving effective control in the hands of Coca-Cola (Encarnation and Vachani, 1985;FERA, 1973;Mahadevan, 2007;Negandhi and Palia, 1988;Subramanian, 2007).…”

Distributing Global Information Systems Resources in Multinational Companies

“…Most discussions on the alignment of IS services within an organization focuses on the centralization / decentralization issue but without a consensus opinion on appropriate alignment models [Dearden, 1987;Owen, 1990;Morison, 1991;Stokes, 1991]. A recent review of information technology (IT) managers found that whilst forty-five percent are preparing to decentralize the IS functions, twenty-eight percent were in the process of recentralization [Niederman, et al, 1991]. Organizations now have technology available to implement either centralized or decentralized IS reporting relationships but these must reflect the communication patterns throughout the organization.…”

“…MNCs are often accused by host governments of using monopolistic power to crush competition, and of gaining favourable credit ratings for investment, thereby competing for scarce capital with domestic industry. Host governments have, therefore, sought to exercise control over multinational corporations operating under their jurisdiction [Negandhi & Palia, 1987]. One of the ways by which they try to exercise control on MNCs is to require MNCs' technology and manufacturing processes to be adapted to local standards [Hamel & Prahalad, 1983].…”

“…In the last decade, the role of information systems (IS) has moved quite dramatically from organizational support systems to strategic weapons in the company portfolio. With recognition of the strategic potential of IS to the organization, the question of how best to manage the information resources has assumed greater importance to practitioners and researchers alike [Wiseman, 1988;Niederman, et al, 1991;. This is not the first time the issue has been raised and, as such, it may be too easily dismissed as a continuation of the debate with regard to the extent of centralization / decentralization appropriate for information systems services support ongoing since the seventies [Dearden, 1987;Edwards, et al, 1989;Feeny, 1989;Owen, 1990;Morison, 1991].…”