Is “the local” powerful enough to shape multinational corporate control over production and consumption?

Is “the local” powerful enough to shape multinational corporate control over production and consumption?

            The local market is part of the structure that build the multinational corporate. Hence most of the multinational corporations always make sure their decision base on the impact of the locals. The big companies also have the resources to make in-depth branding on market analysis depending on products they produce, but without focusing on the local market, they end up in major loses. The economy is usually controlled by the locals since they are people who consume a more significant percentage of products being produced (Gertler, 2017). If the multinational corporations want to maximize their profits, then there is a need for them to capitalize on the knowledge about the local market. I believe that for companies to grow there is a need for the locals to have the ability to purchase the products. However, in instances where we have high unemployment among the locals, there is always a direct impact on the consumption of the products. It gives a clear picture of how the lack of finances among the locals can affect the use of products, leading to loses and making it hard for companies to do the production. Hence, the locals can be linked to having the determination to efficiency, calculability, predictability and control of the multinational cooperation’s. This paper will focus on determining the power of locals towards shaping the multinational corporate control over production and consumption.

Efficiency is the main component in increasing the level of productivity in a multinational company. It enables a company to achieve its goals using the least amount of effort or cost, in production or distribution. Efficiency also helps in making a company to fulfil the needs of the people who consume the product they produce. However, efficiency can come under siege when there is a lack of resources to finance different elements that make it a success. The failure of having efficiency can lead a company to significant loses and also it can lead to the collapse of a company. To satisfy the locals, the companies usually come up with a proper structure that makes sure that the customers have access to their products.

The more the consumer use the product, it enables the companies to finance their efficiency mechanism. In an occurrence where the local customers boycott the multinational companies’ products, the company may be unable to finance its services. It is because of the dependency on the profits to facilitate their operation. It is evident that the locals have the power to control the efficiency of a multinational company. The lack of consuming their products will affect the production directly since if there is minimal or no consumption of a product, it will lead to an inability to production. The money got after selling of the product is usually used in propelling a company’s output by sorting out the expenditure needed for production. I, therefore, believe that interruption in the efficiency function by the locals not consuming the products produced shows the power of the locals. Hence, their boycott of products affects the flow of finance and affecting production. It also affects the consumption rate of products.

Calculability is vital for a company to calculate, count and quantify products that are produced (Murto, Jalas, Juntunen and Hyysalo, 2019). It enables companies to plan for their production levels that will help in fulfilling the demand in a system. In a circumstance where a company basing on the target market quantifies its production, but the consumption levels are minimal. It means that the company may incur in loses, which may affect the production levels. Having the locals as the bigger market, multinational companies tend to base their analysis on the population. Hence, the community is the determinant to the productivity of the companies. When the company does the production basing on the numbers on their analysis, then the consumption levels fall below their target, it makes it hard for the companies to continue doing the production in massive amounts. The minimal consumption of products by the locals means that the companies will face a negative impact on the production levels. Therefore, the dependency of calculation on the locals to increase production means that the locals are the determinant of the quantity of output. Since that is the case, I believe that the locals have the power in controlling the production and consumption of products of multinational companies.

Predictability helps a company in making sure that there are no surprises that may affect the running of the companies.  The multinational companies always want to be sure of the satisfaction and benefit levels. Consumption can affect the predictability of a company, making it fall into loses and also interfering with its production levels. I think that if a company bases its analysis on the locals who are the primary consumers of their products, and then they fail to reach the predicted levels of consumption, then the company will face a significant loss. Therefore, if the locals consume the products of the multinational corporates according to their predictions, then they will make profits. It illustrates the power the local consumption can propel a company’s production.

Reduced consumption levels of products of multinational corporates may lead to the substitution of non-human labour for human labour. It can be caused by the effect of the inadequate consumption of products in affecting the production levels. In cases where the local target market doesn’t consume products according to the predictions by the company. Then most companies may decide a change in its labour force which can be linked to high production levels. Hence, the impact of locals in relation to consumption levels can be linked to affecting the production of a company. I believe that high consumption of produce by the locals can lead to an increase in technology in a company and minimal use of products may also affect the allocation of labour in a company. Hence showing the power the locals have towards the control of operations in multinational companies.

For a multinational company to be successful, there is a need for them to value the local market (Winterhalter, Zeschky,  Neumann and Gassmann, 2017). Since they are the primary consumers of their products. Therefore, there is need for the multinational companies to do in-depth analysis on the local market to enable them to avoid loses and maximize profits through making sure that the production and consumption of products are under control. It is clear that the power of the local market has control over the multinational cooperate production and consumption of their products. Therefore there is a need for the companies to come up with better strategies. It is because the locals have the power to the determine efficiency, calculability, predictability and control of the multinational cooperation’s.

References

Gertler, M. S. (2017). “Being there”: proximity, organization, and culture in the development and adoption of advanced manufacturing technologies. In Economy (pp. 351-376). Routledge.

Murto, P., Jalas, M., Juntunen, J., & Hyysalo, S. (2019). The difficult process of adopting a comprehensive energy retrofit in housing companies: Barriers posed by nascent markets and complicated calculability.

Winterhalter, S., Zeschky, M. B., Neumann, L., & Gassmann, O. (2017). Business models for frugal innovation in emerging markets: the case of the medical device and laboratory equipment industry.