Political Ideology and MNEs Essay Example | Topics and Well Written Essays - 750 words

Political Ideology and MNEs - evidence ExampleIn the era of globalization, MNEs act as investors to local economies, either inducing or simplification large(p) based on perceived political conditions. For example, if an MNE perceives the political ideology of a local organisation to be hostile to wrinkle interests, it can simply pull out of the country and invest that capital at a often favourable country. Authors Daniels et al touch upon this important facet to business answer in their sustain. Just as governing political ideology have a say in MNE decision making, the converse is overly true. In this way, MNEs as a collective force hold a veto power over the decisions of governments. By collectively threatening to withdraw capital, MNEs can coerce governments into tailor policies that suit their ends. Such is the world of real politic that often political ideology comes second to the imperatives of business needs. This other, more vicious, side to MNEs relationship to poli tical ideology is not exposited in the book. This is a considerable omission, for, often, businesses master in the world of real-politic and not stated political ideology. The authors claim in their introduction to the book that their design is to achieve an effective balance between authoritative theory and meaningful practice. But, disappointingly, this objective has not been met by virtue of the afore-stated omission. Just as Political Ideology has an impact on MNE operations, the local culture also has an impact. This facet to MNE management is brought to light by Redpath & Nielsen in their journal article titled A affinity of Native Culture, Non-Native Culture and New Management Ideology published in the prestigious French speech journal Revue Canadienne Des Sciences De LAdministration. One of the challenges facing MNEs when they enter a new market is relations with local cultural sensibilities. There is no systematic approach to resolving this challenge. Often a magnetiz ed leadership with a tactful and diplomatic approach toward understanding local culture works best. Daniels et al in their book on International Business do not deal with this component of MNE operations in any great detail. On the other hand, the article by Redpath & Nielsen does. They describe Hofstedes atomic number 23 key dimensions of national cultural differences and examine the connections between cultural values and management practices. (Redpath & Nielsen, 2007) Hofstedes dimensions ar then analyzed to provide insights into the differences between Native and non-Native cultures and how Native organizations may draw on traditionalistic cultural values to improve organizational effectiveness. In general, Native cultures are described as collectivist, egalitarian, adaptive, and tolerant. The rivalry is made that the cultural context in which Native organizations operate is in many ways more compatible with the new management ideology than is the society in which this ideol ogy prevails. (Redpath & Nielsen, 2007) One of the drawbacks in the book by Daniels and his team is the lack of rigor in referring to economic theories that are the backbone of raw business. For example, the major principles of capitalism as laid down by Adam Smith, and which are still central to modern business operations, do find much mention at all. It should be remembered that capitalism is as much a political ideology as it is an economic system. In the era of neoliberal capitalism, this sparse manipulation of theory by Daniels et al is a