Sumantra Ghoshal

Thinkers1948 to 2004Strategy and organization scholar

Works

In Organizational Structures

Known for

The transnational corporation and the differentiated network.

Ideas

The transnational solution. With Bartlett, the case for the transnational as an integrated network of differentiated units. Caveat: Case research in nine companies, more prescription than test; Leong and Tan (1993) found partial support, and Devinney, Midgley, and Venaik (2000) dispute that the transnational is optimal.

Internal differentiation in the MNC. Headquarters-subsidiary relations are governed differently according to each subsidiary's context: hierarchical, federative, clan, or integrative. Caveat: Cross-sectional association.

Differentiated fit and shared values. MNCs that fit structure to each subsidiary's context, and that build shared values, perform better, and best when they do both. Caveat: The abstract does not give the sample or the performance measure.

Critique of transaction cost theory. With Moran, Ghoshal argued that prescriptions drawn from transaction cost theory are likely to be wrong and dangerous for managers, because organizations are not mere substitutes for failed markets but govern some activities through a logic of their own. Caveat: An argument, not a test.

Organizational Structures that draw on Sumantra Ghoshal (3)

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