The Multilocal Challenge: Managing Cross-Border Functions
Companies are learning to adapt their organizational design to capture cross-border synergies and to protect local sources of profitability. Striking an appropriate balance between the protection of local value and the integration of selected cross-country processes and functions is challenging; the organizational response to create the right linkages must be subtle and avoid blunt centralization. Companies should also consider geographic clustering, ensure clear accountability where it really matters - in linchpin roles - and build common ways of working in critical cross-border processes while allowing the local units to maintain their own cultures. These principles will help to limit the complexity and ambiguity often felt during the formation of multilocals.