Moving Headquarters Overseas

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1. What are the drawbacks and benefits associated with moving business unit and corporate

HQ to another country?

The benefits

One of the merits of undertaking a movement of a business unit of Shifting the HQ is that is organizations gains global recognition. Secondly, this helps the organization to be close to its shareholders as well as main stakeholders and a result the firm will increase its flexibility as well as build its communication. Thirdly, the firms also benefits from the commitment derived from the host’s country laws and policies. Lastly this builds the companies political commitment and motivation.

Drawbacks

The prominent drawback of such moves is that there are heavy financial constrains faced by MNE’s during the move. The second is that the company may face cultural dilution or challenges since different countries have different business culture.

2. If you were a CEO or a business unit head, under what conditions would you consider moving HQ?

There are various conditions that would prompt me as the CEO of an organization to move the HQ. Some of the reasons are:

If the host country laws are not conducive to the business. Examples of such a laws are those that hinder business expansions (Berger, Choi & Kim, 2011).

If the current host country has heavy taxes as compared to the moving country of nation

The last condition is if the target market is varied hence profit maximization

3. If you were a government official in the MNE’s home country, what can you do to discourage such moves of multinational HQ out of the country?

The movement of such MNE’s HQ to other countries may cost the host country, therefore as a government official I would:

Amend the laws that ought to be changed in order to favor such companies or firms.

To offer the MNE’s reliable business environment like that of the target country (Peng, 2013).

References

Berger, R., Choi, C. J., & Kim, J. B. (2011). Responsible leadership for multinational enterprises in bottom of pyramid countries: The knowledge of local managers. Journal of business ethics, 101(4), 553-561.

Peng, M. (2013). Global business. Cengage learning.