AIB-SE (USA) 2004 Annual Meeting, Knoxville, TN

TRENDS IN MANAGING THE CORPORATE INFRASTRUCTURE OF TRANSNATIONAL CORPORATIONS Robert Materna, Ph.D.
The purpose of this paper is to share findings from recent research on a major change that is occurring in the management of the modern enterprise with a focus on the implications for transnational corporations. The results presented in this paper are based, in-part, on a much larger piece of research conducted by CoreNet Global on the subject of Enabling Work in a Networked World.1

Introduction
The subject of integrated corporate infrastructure management began to surface in the mid -1990s as progressive business leaders began seeking new ways to reduce costs and improve the responsiveness and efficiency of their firms. [Materna and Parker, 1998] The topic is so new that neither researchers nor practitioners have been able to agree on a label, but the essence of the concept revolves around the need to integrate, streamline, and align the management of the corporate infrastructure with the continuously changing business needs of the enterprise. In most corporations, this refers to the systematic and integrated management of the noncore activities of the firms value chain that typically include Human Resources (HR) , Information Technology (IT), Corporate Real Estate (CRE), and other functions such as Finance, Legal, or Administrative Services depending on the nature of the enterprise. 2 This concept is graphically illustrated in Figure 1.

HR

IT

CRE

Other Services
(Finance, Legal, Administration, etc.)

Figure 1. Integrated Corporate Infrastructure At first glance, this may appear to be a somewhat trivial issue Management compared to other challenges facing transnational corporations but the implications are significant. The purpose of this paper is to present a summary of findings from the research and explore the implications of these findings on the management of the infrastructure for transnational corporations.

Business Rationale
The business rationale for exploring new and better ways to manage the corporate infrastructure is grounded in the need for the step-level improvements in corporate performance that are being demanded by CEOs, stockholders, and other enterprise stakeholders. Indeed, more than one business leader has suggested that this may be one of the newest sources of competitive advantage for those firms that are willing to embrace the magnitude of change required to implement this concept. But when proposing changes that can be truly classified as disruptive, 3 it is fair to pose the question of why now, whats different, and what is the business rationale? Some of the changes in the business environment that are new and different for corporations in todays world include:

First, and perhaps most importantly, is the fact the globalization of business is no longer ad hoc or theoretical. It is real, pervasive, and changing the nature of competition and the structure of industries around the world. Second, in most transnational corporations, almost all of the firms key processes have now been web-enabled. When coupled with the capabilities of todays knowledge management systems, many senior executives now have access to the information they need, when and were they need it, to assist them in making almost real-time adjustments to the enterprise.4

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Third, the nature of work itself is changing. As has been well documented, there is a massive change occurring where the focus on physical labor is shifting to a focus on knowledge work. This has huge implications for where and how work can be done and the type of infrastructure that is required to support such changes. Somewhat related is the fact that the workforce itself is changing and corporations can more readily scan the globe for the full-time, part-time, or free-agent talent they need. Fourth, because of many of the changes noted above, there has been significant growth in both outsourcing and offshoring. These changes affect not only the corporation itself, but the infrastructure and processes of their partners that must, in turn, also be aligned and integrated with the clients they serve. Fifth, there has been a steady shift in focus from just looking at financials, to a focus on multiple measures of performance using balanced scorecards and other similar techniques. Also, the emerging importance of Corporate Social Responsibility (CSR), transparency, and sustainable development is finally entering the mainstream as major corporations around the world acknowledge its importance. Sixth, as the rate of change continues to accelerate, the importance of flexibility has increased, resulting in the need for corporations to be able to more readily enter and exit markets, develop new products, open or close facilities, redeploy people, or reconfigure their supply chains to meet the needs of a continuously changing market. Finally, following 9/11, workplace security and disaster recovery have surfaced as major issues for firms operating around the world. These factors, in turn, have stimulated interest in the need for more robust and global infrastructure-dependent business continuity solutions. 5

Taken together, all of these factors are creating new opportunities for thoughtful leaders to reexamine the role and capabilities of their infrastructure in reducing costs, improving time-to-market, stimulating innovation, accessing new talent, reducing redundancies, improving productivity, and managing business continuity across the enterprise..

Research Methodology
As mentioned previously the results presented here are part of a much larger body of work conducted by CoreNet Global over the past several years. The focus and theme of the overall research initiative was on Enabling Work in a Networked World where the program was developed and launched for the purpose of transforming the manner in which corporate real estate and other elements of the infrastructure are managed in large corporations. Eight specific topics were addressed within the overall research program but for the purpose for this paper, the focus will be on one of the eight topics, the evolving discipline of integrated corporate infrastructure management and the implications for transnational corporations.6 Overall Research Process The process began in early 2003 when several members of the CoreNet Global staff met to explicitly define the problem. The problem, in this case, was that changes in globalization, technology, the nature of work, and other factors were (and still are) forcing firms to adopt new business models to maintain or increase their competitiveness. 7 Thus, the research challenge was to develop a rigorous method for capturing the impact of the changes on the enterprise and systematically documenting how leading firms are dealing with the problem of redefining themselves to more effectively cope with the changing business environment. Key steps in the overall research process are illustrated in Figure 2.
Industry Vision for 2010 Drafted Research Hypotheses & Structured Interview Guides Developed Interviews with Industry Leaders & Leading Content Practices & Experts Case Studies Conducted Documented Industry Survey Prepared & Administered Findings Validated with Industry Leaders Organizational Reports Readiness & Diagnostic Presentations Prepared Delivered

Problem Defined

Background Research Conducted

Figure 2. Key Steps in the Overall Research Process

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Once the problem was defined, the next step was to review existing literature and findings obtained from years of Discovery Forums and discussions with industry leaders around the world. 8 Following this, CoreNet Global created eight research teams to address specific topics based on information available at that time. Using this as a baseline, each research team developed a number of research hypotheses to be explored by interviewing selected leaders across different industries. Following the interviews, each team then documented their findings using a number of case studies to illustrate key points. This information was, in turn, validated by thought-leaders at an Industry Leader Roundtable held in Tampa, Florida, in late 2003. Using these findings CoreNet Global hired The Gallup Organization to conduct a survey of corporate real estate professionals and infrastructure leaders in major corporations. CoreNet Global then developed an Organizational Readiness Assessment to assist leaders in evaluating the readiness of their corporate real estate and infrastructure functions and is in the process of publishing reports on each of the eight areas to share the findings of the research teams with industry. Scope and Limitations Due to the exploratory nature of this research it was designed to be primarily case-based, supplemented by a broader survey of managers across key geographic regions and industry sectors. Due to time and resource constraints, it was not possible to scientifically test all of the hypotheses from all of the research teams across all geographic regions and industries. Nor was it possible to conduct all of the interviews needed to fully address in sufficient detail the impact of integrated corporate infrastructure management across all of the functions that comprise the corporate infrastructure. Even though an attempt was made to interview people in different functions, in reality, most of the people interviewed and who responded to the survey were, or had been, corporate real executives. As a result, even though over 200 interviews with industry leaders were conducted in less than six months and a substantial amount of information was obtained from the survey, the responses presented in this paper must be assumed to be biased in favor of that particular discipline. To obtain a more complete picture of the true state of infrastructure management in larger corporations, more work needs to be done. More detail on the overall research premise and specific hypotheses that dealt with integrated corporate infrastructure management are addressed in the paragraphs that follow. Overall Research Hypothesis The overall research hypothesis for the team that addressed the integrated management of the infrastructure was as follows: Integrated corporate infrastructure management (ICIM) will be a key source of competitive advantage for leading firms in 2010. To explore this premise in more depth, a number of more specific research hypotheses were developed. Specific Research Hypotheses The research hypotheses were labeled big bets by the research team to reinforce the fact that the issues being explored have the potential to radically transform how companies allocate and manage their resources as well as how they execute their key business strategies. 9 The five hypotheses developed by the ICIM research team proposed that, by 2010: H1: ICIM will be accepted as a best practice by leading multinational corporations. H2: ICIM will be implemented in different ways in different companies resulting in a spectrum of solutions that range from formal organizational structures to the management of service providers that offer integrated solutions. H3: Successful ICIM programs will be characterized by a common vision, common frameworks for evaluating investments, common business processes, a customer service orientation, well defined points of interface with other corporate functions, and common models for managing the performance of the infrastructure. H4: The adoption of ICIM, combined with a continued focus on core competencies, will result in a further blurring of lines between the enterprise and its supply chain resulting in service partners managing significant portions of the firms integrated infrastructure. H5: Trends towards ICIM will result in major changes to the service provider industry. Firms Interviewed

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In an attempt to gather information across a broad cross-section of industries, interviews were conducted with senior corporate real estate and infrastructure managers at American Express, Bank of America, Capital One, CIGNA, Cisco Systems, Dow Chemical, Fleet Financial, Ford, General Motors, General Services Administration, Herman Miller, Hewlett Packard, Humana , JP Morgan Chase, McKesson, Microsoft, Nokia, Nortel Networks, Northern Trust, Sabre Holdings, Sun Microsystems, The St. Paul Companies, and United Technologies. As will be discussed in more detail in the following section, the results from this process were used to develop a broader survey of North American and European professionals. The Gallup Survey Based on feedback from the research teams, CoreNet Global and the teams thought that a broader survey of the industry was needed. As a result, in late 2003 CoreNet Global hired The Gallup Organization to assist in conducting a survey of CoreNet Global corporate members and other professionals on key topics related to enabling work in a networked world. A total of 2917 e-mail invitations were sent with 314 individuals completing the survey resulting in a 11% response rate. For a web-based survey that included 31 questions with multiple parts, experts have stated that this was a good response rate and above industry averages for surveys of this type.

Selected Findings
As abstract as some of these ideas might seem to those who have not been involved, the research team found that large multinationals such as Bank of America, Sun Microsystems, JPMorgan Chase, Nortel, Nokia, Procter and Gamble and many others are already experimenting with different ways to improve and streamline the management of their corporate infrastructures.10 Response to Research Hypotheses Based on the information obtained from the structured interviews and the Gallup survey, the research team found substantial support for each research hypothesis. To enhance readability, each hypothesis is repeated, followed by a brief discussion of the findings. H1: ICIM will be accepted as a best practice by leading multinational corporations. The research team was somewhat surprised by how readily industry leaders seem to accept the idea that ICIM would be accepted as an industry best practice by 2010. As indicated in Figure 3, this was validated by the Gallup survey which revealed that 67% of the 308 leaders and managers who responded to the question agreed that integrated corporate infrastructure management will be accepted as an industry best practice by 2010. Another 10% neither agreed nor disagreed. The resarch team was also surprised by the fact that even though the sample size is limited, the European respondents seem to feel even more strongly about this concept that their US counterparts. These results are illustrated in Figure 4.

23%

10% 67% N = 308

Strongly Agree or Agree Neither Agree nor Disagree Disagree or Strongly Disagree

Figure 3. ICIM as Industry Best Practice by 2010

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50 45 40 35 30 25 20 15 10 5 0 47 40 27 16 7 3 6 10 8 36

Percent of Respondents

Strongly Disagree

Somewhat Disagree

Neither Agree or Disagree US Europe

Somewhat Agree

Strongly Agree

N = 240/36

H2: ICIM will be implemented in different ways in different companies resulting in a spectrum of solutions that range from formal organizational structures to the management of service providers that offer integrated solutions. Based on research conducted to-date, there is strong evidence to support the fact that even though similar corporations in similar industries may have similar visions, the migration path for getting from where they currently are to where they want to be can be substantially different. However, as more interviews were conducted, it began to appear as though firms and their infrastructures could be classified according to the extent to which corporate functions were independent, centralized, integrated and optimized. In some firms there is very little cross-functional integration while, in others, integration occurs at the project level through the use of cross-functional project teams. There are also a small number of firms who seem to have embraced this as a core part of their strategy to boost productivity, accelerate time-to-market, achieve higher levels of business continuity, or meet other business goals. H3: Successful ICIM programs will be characterized by a common vision, common frameworks for evaluating investments, common business processes,UScustomer service orientation, well ICIM as points of interface with other Figure 4. A Comparison of a and European Attitudes Towards defined a Best Practice corporate functions, and common models for managing the performance of the infrastructure. As noted above, even though firms in similar industries can have similar visions for what the want to accomplish with their infrastructures, the manner in which this is carried out can be substantially different depending on the on the culture and needs of the organization. To be sure, the greatest benefits seem to occur if the senior leaders of the corporate functions can develop a common vision for the role of the infrastructure followed by the implementation of common, or at least well integrated sets of strategies for dealing with customers, justifying shared investments, and reliably measuring and managing the performance of the infrastructure. But it should also be noted that significant benefits can also be realized through the integrated management of HR, IT, CRE and other activities at the project level, although the benefits will not be as great.11 H4: The adoption of ICIM, combined with a continued focus on core competencies, will result in a further blurring of lines between the enterprise and its supply chain resulting in service partners managing significant portions of the integrated infrastructure. There was also evidence to suggest that the trend towards the outsourcing of major non-core functions may increase by 2010. This phenomenon is often referred to as Business Process Outsourcing or BPO. When asked whether they thought that major elements of the infrastructure could be outsourced to partners that are not part of the formal organizational structure by 2010, the results are summarized in Figure 5.

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60 Percent of Respondents 50 40 30 20 10 0 Strongly Disagree Somewhat Disagree Neither Agree or Disagree US Europe Somewhat Agree Strongly Agree 3 3 18 10 9 7 48 40 40

22

N = 192/30

The research team also felt that as the outsourcing major infrastructure functions increases, it is likely that firms will align themselves with partners who can offer increasingly integrated solutions on a global basis. After discussing this issue with senior people from a large number of corporations, in the opinion of the research team, the question is no longer if but when highly capitalized new entrants will begin to appear to meet these market needs. H5: Trends towards ICIM will result in major changes to the service provider industry. As suggested in the paragraph above, one of the hypotheses posited by the research team was that demand for integrated services is going to drive major changes in service provider industries. When asked to rate the extent to which corporate decisions to integrate their infrastructures will force service providers to integrate their offerings in a corresponding way by 2010, both US and European respondents overwhelming agreed that major changes are likely. (See Figure 6)
70 Percent of Respondents 60 50 40 30 20 10 0 Strongly Disagree Somewhat Disagree Neither Agree or Disagree US Europe Somewhat Agree Strongly Agree 8 3 13 11 16 6 20 20

Figure 5. A Comparison of US and European Attitudes Towards the Outsourcing of Major Portions of the Infrastructure 60
44

N = 224/35

To respond to what is being suggested here, existing providers and new entrants will be expected to be more strategic, able to leverage their experience and best practices from other clients, and offer a full range of integrated solutions on a regional or global basis using alliances where necessary. To offer integrated services of this scope will

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Figure 6. A Comparison of US and European Attitudes on the Impact of ICIM on Service Providers

AIB-SE (USA) 2004 Annual Meeting, Knoxville, TN

require significant investments in people with the right talent and experience; information systems that are able to track and manage resources for their clients; and facilities that are located in the primary markets being served.

Implications for Transnational Corporations

If one accepts the fact that the role of the transnational corporation is to both leverage the economies of scale and other efficiencies associated with developing products and services for global markets while retaining local responsiveness, the importance of the corporate infrastructure becomes readily apparent. 12 In fact, the corporate infrastructure of the modern corporation touches almost every activity associated with where to locate R&D centers, manufacturing sites, major distribution facilities, retail outlets, and even call centers. It also affects the firms ability to share information; develop new products; leverage the talent of its global workforce; and optimize the performance of its global supply chain to meet the needs of customers in different local or regional markets. In short, the firms corporate infrastructure is one of those necessary but not sufficient capabilities that enables a firm to execute its core business strategies. In todays global environment, it also raises anew many of the questions that have traditionally been faced by international or global corporations, i.e., the need to insure that their physical, human, and electronic infrastructures are capable of supporting the business needs of the enterprise. According the Bartlett and Goshal, transnational corporations need to focus on building three distinct capabilities: global scale efficiencies and competitiveness; national-level responsiveness and flexibility; and the ability to leverage knowledge and learning across markets on a worldwide basis. 13 But to achieve this in complex organizations, the infrastructure must be strategically aligned, thoughtfully integrated, and systematically deployed to provide these capabilities. Aligned with Corporate and Business Unit Strategies One of the keys to being able to achieve the step-level benefits that are possible is the need to build and sustain alignment between the infrastructure and the business goals and strategies of the enterprise. Key steps include understanding the business of the enterprise and developing strategies for implementing integrated infrastructure solutions that are designed to support the global, regional, and local needs of the corporation; building a business case that captures both the financial and non-financial costs and benefits of the required changes; securing executive support to implement any infrastructure changes required; establishing systems and processes for continuously measuring the performance of the infrastructure and making adjustments as necessary, to support changing business needs; and putting the people, processes, and systems in-place to maintain alignment and leverage the knowledge capital, cost savings, speed, and other synergies that can be obtained by deploying integrated infrastructure solutions across a global platform. Integrated Across Functions In addition to being aligned with the business needs of the corporation, the corporate infrastructure must also be internally integrated across functions. Although higher levels of integration are certainly needed across Finance, IT, HR, Corporate Real Estate and other areas, there are certain tasks that will remain unique to each function. Preliminary evidence suggests that the key is to define a common vision for the role of the infrastructure and a consistent set of integrated strategies for delivering services to the firms internal and external customers. Approaches for achieving this range from the use of cross-functional teams to address ad hoc needs, to the creation of managerial councils who oversee strategic infrastructure initiatives, and regular discussions in the C-suite (the CEO, CIO, COO, CFO, etc.) that address the desired role and capabilities of the infrastructure. Deployed to Support the Geographical Needs of the Enterprise The challenge here is to offer integrated infrastructure solutions that are designed and deployed to support the international business strategies of the enterprise. Many years ago, Heenan, Perlmutter, Chakravarthy and others suggested that corporate activities such as marketing, manufacturing, human resources, finance, and other areas need to be aligned with the international strategies of the corporation. Fortunately, they also provided us with some useful frameworks for thinking about how to insure that the firms strategies and supporting services are aligned and

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deployed in a consistent and optimal manner. [Perlmutter, 1969; Heenan and Perlmutter, 1979; Chakravarthy and Perlmutter, 1985]. Although the EPRG model was formally introduced in 1969, it remains a relevant and useful tool for thinking about how to align the firms resources, systems, and processes with the geographical strategies of the corporation. 14 Building on the work of Perlmutter, Heenan and Chakravarthy, Figure 7 highlights how the EPRG typology can be applied to assist decision-makers in evaluating their current and desired approach for managing their international operations. Observers will note, however, that there is one substantial difference. Arrows have been added to reinforce the need for higher levels of integration across the firms corporate infrastructure functions to insure that decisions to deploy infrastructure resources are not sub-optimized, or are at least made with the full realization that different international strategies are being used for different elements of the infrastructure. Ethnocentric Focus Strategy Home Country Globally Integrative Polycentric Host Country Nationally Responsive Regiocentric Regional Regionally Integrative and Nationally Responsive Strategies, systems, and processes designed to meet needs and standards for recruiting, hiring and managing people in the region Geocentric Global Globally Integrative and Nationally Responsive Strategies, systems, and processes designed to meet global needs and standards for recruiting, hiring and managing people

Human Resource Function

Strategies, systems, and processes designed to meet home country needs and standards for recruiting, hiring and managing people

Strategies, systems, and processes designed to meet host country needs and standards for recruiting, hiring and managing people

Information Technology Function

Strategies, systems, and processes designed to meet home country needs and standards for IT applications and communications

Strategies, systems, and processes designed to meet host country needs and standards for IT applications and communications

Strategies, systems, and processes designed to meet needs and standards for IT applications and communications in the region

Strategies, systems, and processes designed to meet global needs and standards for IT applications and communications

Corporate Real Estate and Workplace Function

Strategies, Strategies, Strategies, systems, and systems, and systems, and processes designed processes designed processes designed to meet home to meet host to meet needs and country needs and country needs and standards for standards for standards for corporate real corporate real corporate real estate and the estate and the estate and the workplace in the workplace workplace region Figure 7. Applying the EPRG Model Across Corporate Infrastructure Functions

Strategies, systems, and processes designed to meet global needs and standards for corporate real estate and the workplace

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As suggested above, one concern is that while outsourcing may provide substantial benefits at the functional level, many of the synergistic benefits of a fully integrated infrastructure can be lost if major elements of the infrastructure are not cross-functionally integrated and deployed to support the same EPRG profile (or hybrid profile) of the enterprise. Figure 8 graphically illustrates how gaps can be created if elements of the infrastructure have different EPRG profiles. In some situations the firm may choose to design and deploy some functions differently to support specific goals, but such situations must be managed in order to avoid sub-optimizing the overall configuration and management of the firms infrastructure resources. In the figure below, the firm has chosen to adopt a regiocentric approach towards its infrastructure, but its financial strategies, administrative policies and HR strategies still reflect the ethnocentric views of the parent and are not aligned with the regiocentric strategies, systems, and processes that have been deployed within the Corporate Real Estate and IT functions.

Conclusions
Real Estate and Workplace Strategies

IT Strategies

HR Strategies

Financial Strategies

Administrative Policies

Global (G) Regional (R) Multi-Domestic (P) Domestic (E)

Current Profile Preferred Profile

Figure 8. Using the EPRG Model to Design and Configure the Corporate Infrastructure

Developing effective, efficient, and highly integrated infrastructure solutions has the potential to challenge some of our most commonly accepted theories about factors that that influence the success or failure of transnational corporations. Todays business environment demands new thinking about how to support the global needs of the enterprise and integrated corporate infrastructure management may be one of the keys in determining the success or failure of transnational firms in the future.

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AIB-SE (USA) 2004 Annual Meeting, Knoxville, TN Areas for Further Research
Although the research to-date suggests that this is a promising new area for improving the competitiveness of transnational corporations, more study is required to really understand many of the complex issues involved. Some of the areas that need more work include:

Exploring differences, if any, between the perceived need for higher levels of integration across corporate functions. Such work should examine this issue across different industry sectors, countries, and geographical regions. Identifying different approaches for implementing and managing cross-functional integrated solutions, and the key steps and governance models involved. Identifying and documenting examples of how firms are justifying the cross-functional investments that often necessary to achieve the step-level benefits in innovation, time-to-market, employee satisfaction, and cost reduction that are possible. Developing models that can more effectively predict the optimal configuration of the corporate infrastructure under different business conditions. Assessing the impact of ICIM on service provider firms and industries. As companies continue to outsource their non-core functions, it is clear that, at some point, firms are going to start asking for one stop shopping. In other words, in the not-to-distant future, progressive firms will be looking for service providers, or networks of providers, that can deliver fully integrated infrastructure solutions that are designed to meet the needs of transnational corporations on a global basis.

Notes

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The formal title of the program was Corporate Real Estate 2010: Enabling Work in a Networked World: A Research and Leadership Development Program for Corporate Real Estate and Infrastructure Management Professionals. This program was designed and managed by the CoreNet Global Learning Foundation, a non-profit organization established to conduct research and deliver learning programs on behalf of CoreNet Global, the world's premier association for corporate real estate and related professionals. 2 Other authors that have addressed this topic include Ken Robertson. (1999) Work Transformation: Planning and Implementing the New Workplace. HNB Publishing; and Michael A. Bell and Michael Joroff. (2001) The Agile Workplace: Supporting People and Their Work. Gartner and the Massachusetts Institute of Technology. 3 For more information on disruptive versus incremental change, see Clayton Christensens work on the Innovators Dilemma and the Innovators Solution. 4 Knowledge management is one of the keys to being able to compete on a domestic or international basis, and one of the keys to effective knowledge management is the firms corporate infrastructure. See Gary A. Knight and S. Tamar Cavusgil. Innovation, Organizational Capabilities, and the Born-Global Firm. (2004) Journal of International Business Studies, Volume 35, Issue 2, pp. 124-141. 5 To illustrate, Sun Microsystems implemented their iWork program in New York in 2000 by deploying workplace solutions that were designed to meet the integrated work needs of their networked workforce. By fully integrating their people, technology and workplace strategies, following 9/11 Sun was able to return to operations within 24 hours of the attack. Similarly, the European offices of Citigroup had a number of facilities that they were planning to close in London, but decided to reevaluate their plans for consolidating their facilities in light of the need for some measure of security-driven redundancy. 6 The eight topics addressed in the Corporate Real Estate 2010, Enabling Work in a Networked World research program included: The Changing Nature of Work and the Workplace; The Strategic Role Of Place; Asset Management and Portfolio Optimization; Integrated Corporate Infrastructure Management; New Models for Service Delivery and the Transformation of The Service Provider Industry; The Role of Technology and The Web; Sustainability and Corporate Social Responsibility; and Enterprise Leadership, which addressed the Skills and Competencies for Successful Corporate Real Estate and Infrastructure Leaders. 7 For more information on business models and why they matter, see Joan Magretta. (2002) Why Business Models Matter." Harvard Business Review. Volume 80, Number 5, pp. 86-92. 8 Discovery Forums are another form of research that was developed by CoreNet Global to explore changes and best practices in industry. Discovery Forums are by-invitation-only events of 25 to 30 professionals that engage in facilitated peer-to-peer learning and knowledge sharing in a safe environment. Over 40 forums have been held in North America, Europe and Asia over the past four years. 9 The term big bet was borrowed from Sun Microsystems which has periodically used the term to describe major changes in strategy at Sun. 10 To illustrate, both Nortel and JPMorganChase have implemented different infrastructure solutions to meet their different business needs. In the case of JPMorganChase they actually created a Strategic Infrastructure Group at their New York headquarters to explore and deploy integrated solutions in major markets across the Untied States. In the case of Nortel, their innovative attempts to improve the quality and efficiency of their infrastructure were driven, in part, by their extended near death experience over the past several years. 11 As suggested by Kim, Park, and Prescott, global integration in transnational corporations can only be achieved through the use of organizational mechanisms for coordination and control. Hence, having a common vision, shared or integrated processes, and common models for measuring performance become paramount. See K. Kim, J-H Park, and J.E. Prescott. (2003) The Global Integration of Business Functions: A Study of Multinational Businesses in Integrated Industries. Journal of International Business Studies. Volume 34, Number 4, pp. 327-344. 12 For more information on concepts associated with managing transnational corporations, see Christopher Bartlett and Sumantra Ghoshal. (Fall, 1988) Organizing for Worldwide Effectiveness: The Transnational Solution, California Management Review, pp. 54-74 or Christopher Bartlett and Sumantra Ghoshal. (1992) Transnational Management. Homewood, Il: Irwin. 13 See Christopher Bartlett and Sumantra Ghoshal. (1992) What is a Global Manager, Harvard Business Review, Volume 70, Number 5, p. 124. 14 The EPRG model refers to the labels developed by Howard Perlmutter to describe the mindset of executives who are responsible for planning and managing the firms international business strategies. E stands for Ethnocentric; P for Polycentric; R for Regiocentric; and G for Geocentric. For more information on the EPRG approach, see, Howard V. Perlmutter. (1969) The Tortuous Evolution of the Multinational Corporation, Columbia Journal of World Business, (January-February) pp. 9-18; David A. Heenan and Howard V. Perlmutter, (1979) Multinational Organization Development. Reading, Massachusetts: Addison-Wesley Publishing Company; Howard V. Perlmutter and David A. Heenan. (1986) Cooperate to Compete Globally. Harvard Business Review. ( March-April) pp. 136-152; or Balaji

Chakravarthy and Howard V. Perlmutter. (1985) Strategic Planning for a Global Business, The Columbia Journal of World Business, Volume XX, Number 2, pp. 3-10.

References
Bartlett, C. and Ghoshal, S. (Fall, 1988) Organizing for Worldwide Effectiveness: The Transnational Solution, California Management Review, pp. 54-74. Bartlett, C. and Goshal, S. (1992) What is a Global Manager, Harvard Business Review, Volume 70, Number 5, p. 124. Bartlett, C. and Ghoshal, S. (1992) Transnational Management. Homewood, Il: Irwin. Bell, M. and Joroff, M. (2001) The Agile Workplace: Supporting People and Their Work. Gartner and the Massachusetts Institute of Technology. Chakravarthy, B. and Perlmutter, H. (1985) Strategic Planning for a Global Business, The Columbia Journal of World Business, Volume XX, Number 2, pp. 3-10. Christensen, C. (1997) The Innovators Dilemma, Boston, Massachusetts: Harvard Business School Press. Christensen, C. and Raynor, M. (2003) The Innovators Solution: Creating and Sustaining Successful Growth, Boston, Massachusetts: Harvard Business School Press. Heenan, D. and Perlmutter, H. (1979) Multinational Organization Development. Reading, Massachusetts: Addison-Wesley Publishing Company. Kim, K.; Park, J-H.; and Prescott, J.E. (2003) The Global Integration of Business Functions: A Study of Multinational Businesses in Integrated Industries. Journal of International Business Studies. Volume 34, Number 4, pp. 327-344.. Knight, G. and Cavusgil. Innovation, Organizational Capabilities, and the Born-Global Firm. (2004) Journal of International Business Studies, Volume 35, Issue 2, pp. 124-141. Magretta, J. (2002) Why Business Models Matter." Harvard Business Review, Volume 80, Number 5, pp. 86-92. Materna, R. and Parker. J. (1988) Corporate Infrastructure Resource Management: An Emerging Source of Competitive Advantage. Norcross, Georgia: The IDRC Foundation Research Bulletin, No. 22. Perlmutter, H. (1969) The Tortuous Evolution of the Multinational Corporation, Columbia Journal of World Business, (January-February) pp. 9-18. Perlmutter, H. and Heenan, D. (1986) Cooperate to Compete Globally. Harvard Business Review. ( March-April) pp. 136152. Robertson, K. (1999) Work Transformation: Planning and Implementing the New Workplace. HNB Publishing.

About the Author

Dr. Materna is semi-retired and serves as an Adjunct Professor in the Department of Management and Entrepreneurship, Kennesaw State University, Kennesaw, Georgia.