Transnational IT Operations

University of Phoenix

CMGT/578 CIS Strategic Planning

February 7, 2011

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Transnational IT Operations

A transnational company is a corporation that is registered and operates in more than one country at the same time (West's Encyclopedia of American La., n.d.). A transnational corporation has its headquarters in one country and operates wholly or partially owned subsidiaries in one other, or many other countries. Some companies will outsource a portion or sometimes all of their Information Technology (IT) functions to a foreign country for a verity of reason. Companies that move a portion of their operations, such as IT, need to investigate the advantages, disadvantages, and tradeoffs of moving a critical component of their business operations to a foreign market.

Aspects and Issues

What business owner would not want to jump impulsively at the chance to access foreign capital, increased resources, and access cheaper labor? However, there are barriers, consider the obstacles encountered in the domestic management of an IT department. Take those obstacles and move them to a new culture in another country, then add economic regulations, lack of local Technological infrastructure, Language barriers, and possible political turmoil (IT world, 2001). Those benefits seem to diminish with this mix added in, and this is just the beginning.

Other considerations will include the local customs. Does the local population of the area chosen work well with time constraints? Will religious rites, customs, and traditions interfere with the business goals or productivity desired? Will quality and control standards be able to be enforced? Based on some wide eyed news reports global expansion seems nearly impossible. However, based on evidence to the contrary, creating a transnational operation is not impossible, in fact the current economic model is global with...

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