The coming metanational era

Citation

Pennington, M.W. (2002), "The coming metanational era", Strategy & Leadership, Vol. 30 No. 4. https://doi.org/10.1108/sl.2002.26130dae.003

The coming metanational era

Malcolm W. Pennington

From Global to Metanational

Yves Doz, Jose Santos and Peter WilliamsonHarvard Business School PressBoston, MA2001242 pages$29.95

The metanational company is, according to the authors, the necessary next step in corporate organization. In order to understand why this evolutionary process is inevitable, let us look at how the multinational and the metanational organization compare.

The multinational takes the products, services and know-how that it has developed in its home country and leverages this experience by producing and marketing around the world. This enables it to reap the benefits of global scale economies, serve its multinational customers, and use its global resources to attack the market positions of national companies. It gains access to cheap labor and raw materials by moving production or back-office operations to the developing world, leaving only the high-value activities – strategy, R&D, product design, marketing, systems development, finance – at home.

In comparison, the metanational company adds a new kind of competitive advantage by discovering, accessing, mobilizing, and leveraging knowledge from many locations around the world. In the new Global Village competitive advantage is primarily based on knowledge. The critical success factor: not all the knowledge a global company needs can be found in one place; it is scattered world-wide. Another factor likely to contribute to the success of metanationals: the cost of distance is falling rapidly for capital, goods and information.

A fully-fledged metanational corporation does not yet exist, the authors concede. However, some companies like Nokia have made major strides in this direction. Its metanational strategy took its competitor Motorola by surprise. Just a few years ago Motorola dominated the mobile phone market. It had no reason to suspect serious competition from a small company in a remote corner of Europe. But Nokia built a series of design, production and finance associations all over the world and surged into first place.

This book is full of similar examples gleaned from all over the world, including case studies of STMicroelectronics, Acer, Shiseido, PolyGram, ABB, Ciba-Geigy, and 3M. These cases are the best part of the book. They are succinct, focused, and extremely useful.

Unfortunately, because the three authors are all professors at leading business schools, they feel a professional responsibility to cover every possible aspect of creating a true metanational corporation in painful detail. As a result, the book is about 100 pages longer than almost any manager will need.

The way to cope with their prolixity is to read the preface and the first three chapters (88 pages). This will give you the basic background and main case histories. Then skim through the rest of the book and read the remaining examples as you find them. You will have valuable insights into why a metanational structure may be the next big step for global companies, useful information from the cases, and you will have enjoyed an entertaining read.