The Strategic Management of Multinationals and World Product Mandating 1

Abstract

This chapter reviews the nature of corporate strategic planning, the role of strategic business units and the implications that these have for Canadian public policy toward multinational corporations in general and world product mandating in particular. It outlines the stated objectives of Canadian policy regarding world product mandates and reviews the problems of such a policy. The Science Council of Canada proposed that the federal government should encourage Canadian subsidiaries of multinational enterprises' multinational enterprises (MNEs)to seek world product mandates (WPMs) from their parents outside Canada. A WPM should be defined as the full development, production and marketing of a new product line in a subsidiary of an MNE. Corporate strategy uses the strategic business unit as its basic unit of analysis. Such strategy is concerned with the optimal integration of the business units. Probably the key constraint of the use of from the MNE's viewpoint is the risk of losing control of the marketing function.