2.2. Types of enterprises.

There are a lot of types of business enterprises. For example, theory of organization includes international, global, multinational, and transnational firms.

An international enterprise is an organization which conducts business operations in cross national borders. The term “parent company” is used which refers to the firm investing or conducting business in international operations, while the host country is the country where such enterprise is conducted.  International business generally is business operations of any sort by one firm which take place within or between two or more independent countries. International enterprises are involved in marketing, manufacturing, or the sale of services (as with an accounting firm). This type of international business includes a management dimension in a foreign environment, and as such is one of the most complex and interesting types of international business studies. Firms cannot assume in this case that management problems will be identical to those faced at home and export and import trade. Some examples of these firms are “Exxon”, “Colgate-Palmolive”, “Dow Chemical”, and “Texaco”.

 On the other hand, global organizations are known as national firms having international operations. This means that an established company in one country may have an international business operations in other countries.  Global companies view the world as a single unit, and global corporation’s subsidiaries are guided by a global pervasive approaches and strategy. Global industries tend to provide fairly standardized and high quality products all over the world which enables the companies to exploit their savings derived from economies of scale. Global firms include “IBM”, “General Motors”, “Hyundai”, and others.

Multinational enterprises are companies that undertake production, research and development, finance and marketing on an international basis in more than one country. In order for an enterprise to be multinational, its activities must have a certain impact upon the economy. The management must have a global perspective and a strategy that surpasses nationalities and boundaries. It must work to advance the enterprise by utilizing the differences among various resources and by setting regulations that limit corporate activities. The multinational enterprise must be supported by the overall system of control and organization in order to act as an entity. It must have enough flexibility to adapt to the demands for localization and customs of the society and government of the host country. Only when these conditions are fulfilled an enterprise can be called multinational. Examples of these multinational companies are: “McDonald’s”, “Siemens”, “Ford” etc. Aside from generating profit, multinational corporations are also beneficial in its generation of vast employment.

            The term “transnational corporation” is designed to cover all business organizations that operate across national boundaries and in any field of activity, through entities or affiliates in two or more countries. It is noted that it does not matter whether the enterprise is privately-owned, state-owned or of mixed undertaking. Some examples of transnational organisations are: “Citicorp”, “Nigeria Plc” and others. “Unilever Corporation” has evolved into one of the transnational companies and began to penetrate the home and personal market.