Multinational Corporation

Multinational corporation (MNC), any corporation that is registered and

operates in more than one country at a time. Generally the corporation has
its headquarters in one country and operates wholly or partially owned
subsidiaries in other countries. Its subsidiaries report to the corporation’s
central headquarters.

In economic terms, a firm’s advantages in establishing a multinational

corporation include both vertical and horizontal economies of scale (i.e.,
reductions in cost that result from an expanded level of output and a
consolidation of management) and an increased market share. Although
cultural barriers can create unpredictable obstacles as companies establish
offices and production plants around the world, a firm’s technical expertise,
experienced personnel, and proven strategies usually can be transferred
from country to country. Critics of the multinational corporation usually view
it as an economic and, often, political means of foreign domination.
Developing countries, with a narrow range of exports (often of primary
goods) as their economic base, are particularly vulnerable to economic
exploitation. Monopolistic practices, human-rights abuses, and disruption of
more-traditional means of economic growth are among the risks that face
host countries.

The primary requirement to become a multinational corporation is to make

a direct investment into another country by operating part of your business
there. Here are some characteristics of typical MNCs:
Large number of assets: To become a successful MNC, a company needs
a high number of assets. This includes tangible assets, like employees, as
well as financial assets.
Broad networks: Many MNCs have a broad network that stretches to many
places on the globe. A company operates each branch to manage
manufacturing, production and sales operations.
Constant growth: A successful MNC may experience constant growth.
These corporations might try to expand their impact by placing one or more
branches in the same location, or by placing several branches in various
countries.

Role of MNC’s and Globalization:

Multi-national corporations have a dominant role in globalization.
Globalization is the creation of global systems in the areas of
transportation, economics, communication, labor, culture, and ideas. Multi-
national corporations are especially concerned with the economic and
political aspects of globalization. Changes in these aspects in different
countries can have significant effects on their operations, and so they make
sure that their voices are heard. Some corporations even attempt to shape
the policies of other countries using roundabout methods. This can be done
in multiple ways. For instance, many multinational corporations engage in
foreign direct investment, which occurs when a multinational corporation
gains controlling interest in a foreign company. In this way, the
multinational corporation will be able to indirectly affect the creation of
economic policies which favor the corporation.

Advantages and disadvantages of MNC

Advantages:
There are many benefits of being a multinational corporation
including:

1. Efficiency
In terms of efficiency, multinational companies are able to reach
their target markets more easily because they manufacture in the
countries where the target markets are. Also, they can easily access
raw materials and cheaper labor costs.
2. Development
In terms of development, multinational corporations
generally pay better than domestic companies, making them
more attractive to the local labor force. They are usually favored
by the local government because of the substantial amount of
local taxes they pay, which helps boost the country’s economy.

3. Employment
In terms of employment, multinational corporations hire
local workers who know the local culture and are thus able to
give helpful insider feedback on what the locals want.

4. Innovation
As multinational corporations employ both locals and foreign
workers, they are able to come up with products that are more
creative and innovative.
Disadvantages:
Despite the benefits of being a multinational corporation,
there are also several disadvantages as well:

1. Increased legal burden

A multinational corporation will face increased legal complexity due to
operating in multiple jurisdictions. Different countries have different laws
around corporate structure, torts, contracts, the environment and
employment, to name a few. The MNC requires a local legal presence to
help navigate these complexities.
2. Increased tax compliance
An MNC will also encounter different taxation regimes by operating in many
different countries. There may be different rules around sales or value-
added tax, tax deductions (e.g., depreciation), the ability to use net
operating losses to offset future taxable income, not to mention different tax
rates.

3. Public relations
A multinational corporation may be accused of sending or creating jobs
outside of the corporation’s home country, thereby resulting in negative
public relations and political rhetoric in the home country. Conversely, the
MNC may be accused of exploiting local workers, resources and
regulations in the foreign country as well.

4. Political instability
A multinational corporation may experience political instability depending
on where the MNC has offices and resources. Most MNCs have politically
stable and economically developed home countries but operate in less
developed countries. Sometimes the less developed country will
experience political turmoil, including local corruption, which can impact the
MNC’s operations.

Examples of Multinational Corporations:

The following is a brief list of well-known multinational corporations:
1)Apple
2)ExxonMobil
3)Microsoft
4)Proctor & Gamble
5)Tesla
Example's of multinational corporation in Bangladesh:
The Following is brief list of well known multinational corporations:

1) United dhaka tobacco company

2)Grameenphone ltd
3)British american
4)Ericsson
5)Jm agro fisheries

Human Resource Development (HRD)

Human resource development HRD is "the process of increasing the

knowledge, the skills, and the capacities of all the people in a society. In
economic terms, it could be described as the accumulation of human
capital and its effective investment in the development of an economy. In
political terms, human resource development prepares people for adult
participation in political processes, particularly as citizens in a democracy.
From the social and cultural points of view, the development of human
resources helps people to lead fuller and richer lives, less bound by
tradition. In short, the processes of human resource development unlock
the door to modernization.

There are two types of HRD:

Formal: Companies might hire a consultant to spearhead HRD for an
organization. The process might also include coursework and highly
organized training sessions.
Informal: Managers can provide mentorship to new team members, and
they actively participate in the onboarding process. There may not be a
formal schedule or execution of training compared to formal HRD.
The objective of HRD are:
The objectives of HRD are designed to drive employee performance,
growth, and alignment with organisational goals. The objectives include the
following:

a) Boosting productivity and performance: HRD aims to improve the

productivity and performance of employees by providing them with the
necessary skills and resources. This helps individuals become more
efficient, increasing overall organisational productivity.

b) Enhancing skills for changing demands: HRD focuses on developing

employees’ skills and abilities to meet the organisation's evolving needs.
This includes training programs and continuous learning opportunities to
keep employees updated and adaptable in a rapidly changing business
environment.

c) Promoting career development and growth: HRD provides employees

with career development and growth opportunities. This can include
training programs, mentorship, coaching, and succession planning to
support their advancement within the organisation. Organisations can
promote loyalty and retain talented individuals by investing in employees'
career development.

d) Creating a positive learning environment: HRD aims to cultivate a

positive work environment that promotes continuous learning and
development. This includes facilitating a culture of learning, providing
access to resources and tools for skill development, and encouraging
knowledge sharing among employees.

e) Aligning goals with organisational objectives: HRD ensuring that

employees' goals and objectives are aligned with those of the organisation.
By establishing clear expectations, performance management systems,
and career planning initiatives, Human Resource professionals helps
individuals understand how their work contributes to the organisation's
overall success.

HRD plays a vital role in making an organisation dynamic and growth-

oriented. Here's How:

a) Driving organisational success: HRD is crucial for organisations that aim

to be dynamic and growth-oriented. It enables organisations to adapt to a
fast-changing environment and take new directions by continuously
acquiring and sharpening employee capabilities.

b) Harnessing Human Resources: While personnel policies can boost

employee morale and motivation, HRD goes beyond that by focusing on
developing and utilising employee competencies. It recognises that an
organisation's growth and success heavily rely on its Human Resources
skills and abilities.

c) Continuous skill development: HRD emphasises the need for ongoing

skill acquisition, sharpening, and utilisation. It ensures that employees have
the necessary capabilities to meet the evolving demands of the
organisation and stay competitive in the market.

d) Enabling organisational culture: An "enabling" organisational culture is

vital for HRD to thrive. This culture encourages employees to use their
initiative, experiment, innovate, take risks, and make things happen. It
fosters an environment where employees are empowered to contribute
their best and drive organisational growth.

e) Adaptation and renewal: Even organisations that have reached their

growth limits must adapt to the changing environment. HRD processes are
essential for acquiring and increasing capabilities for both stability and
renewal. They enable organisations to stay relevant, overcome challenges,
and seize new opportunities.

f) Improving work quality: HRD programs help employees understand their

job expectations, leading to better quality work.

g) Increasing employee retention: Employees who feel supported in their

training are more likely to be satisfied with their jobs and stay with the
enterprise, saving time and resources on frequent recruitment.

h) Enhancing workplace relationships: HRD promotes team collaboration

and communication, allowing new employees to connect with colleagues
and feel comfortable reaching out to their managers. This promotes a
productive and harmonious work environment.
Source :1. Study.com 2.unevoc.unesco.org 3.indeed.com