Abstract
Multinational companies are moving towards a highly diversified world where domestic and global competition is really strong. In the business world, trends and demands of consumers are changing frequently, and firms have to adapt and struggle to find their way to retain their positions as market leaders. Generally the success of a multinational company is dependent on the efficient control system in the organization. However, control is not easy to exercise. All companies are facing many questions about control: "Where are decisions made? How can the company optimize globally? How should country units report to headquarters?" (Davies, 2008). In addition, control is more difficult for multinational firms as their operations are based abroad. Hence, external factors such as distance and all other uncontrollable characteristics have to be taken into consideration. The aim of this paper is to demonstrate how the environmental characteristics might affect the control process in multinational firms. This essay is divided into two sections. The first section gives details about the global environment which is chaotic, complex, dynamic and turbulent, generally increasing the level of uncertainty facing senior executives. The second section focuses on the way control is exercised in MNCs and provides some alternatives at the end, in order to avoid control problems in a company.
