Coordination and Control Mechanisms of Western European MNC towards Southeast Asia Subsidiaries: A Case Study of PZ Cussons

Abstract Date of final seminar:           June 3rd, 2010   Level: Master Thesis: EFO705 (15 Credits)   Authors: Ratiboon    Assawajaruwan (850522) Teeranuch Pumthong           (850508) Title: Coordination and Control Mechanisms of Western European MNC towards Southeast Asia Subsidiaries   Tutor: Leif Linnskog                         Examiner:       Ole     Liljefors   Research Problem:   “How does Western European MNC coordinate and control its subsidiaries in Southeast Asia?”   Purpose: To describe how Western European MNC controls and coordinates with its subsidiaries in Southeast Asia.   Method: The qualitative approach is employed for gathering data and analysis. The primary data is collected by the semi-structure interview. PZ Cussons is selected as a case study in order to study and describe the control and coordination mechanisms between headquarters and subsidiaries.   Conclusion: To achieve effective business operation and respond to increased complexity of international environments, it is important for a large and complex MNC as PZ Cussons to concern the control and coordination mechanisms between headquarters and subsidiaries. Considering different contexts among various subsidiaries, PZ Cussons structured the organization as multi-home-based MNC with partial in heterarchical management and deploys a combination of several control and coordination mechanisms to fit with each subsidiary’s environment. Transnational solution as well as control and coordination mechanisms as differentiated fit and shared value are integrated and implemented by PZ Cussons headquarters in UK to cooperate with Thailand and Indonesia subsidiaries in Southeast Asia.   Keywords: Multinational Company, Organization structure, Coordination mechanism