Organization

In order for us to fully to understand the industry structure it will be prudent to consider one organization in a particular country and in our case we will study and analyze British American Tobacco (BAT) Company which is in London, U. K, particularly on how it has responded to global events. BAT Company is the second largest listed producer of tobacco products in the world and it is categorized to be in the tobacco industry. BAT Company is said to be among the top market leaders in the tobacco industry. BAT Company is also reported to be employing over fifty five thousand employees and its annual revenue is estimated to be ?

9,762 million from each subsidiary. The company’s workforce is diverse and multicultural in nature. The objectives of the company include increase of its products that is its brands, building worth of its dealing, enhance efficiency in production, and to implant the main beliefs of corporate social responsibility in all the branches of the company. The vision of the company is to be the leader of the worldwide tobacco industry. The company has Board of Directors who has played the role of ensuring that the company is directed to a success.

Further the management of the company is considered to be effective and efficient in carrying out their expected duties. (Mark, 2001) The subsidiaries of the company in the different countries have the autonomy to make their decisions so long as it is in line with the company’s overall main objectives. This has enabled decision-making processes to involve all the shareholders of the company in the respective subsidiaries. The company’s management is aware of the risks caused by the tobacco products that they produce and it has formulated an effective operating responsibility that guides the consumers of the products.

The company’s interest lies mainly in tobacco leaf planting and the company work hand in hand with farmers globally. The company does this by giving the farmers agronomy support that wraps all dimensions of crop production and environmental best practice as set by international standards. This aspect enabled the company to buy over four fifty thousand tones of tobacco leaves from two hundred thousand farmers around the globe. (Daniels, Radebaugh and Sullivan, 2007)

This study focuses on the different financial management practices being used by Multinational firms, such examples are the provision of dividends on the firm’s dividend policies in relation to its earnings, the different applications of management of ownership to benefit from its various advantages depending on the firm’s needs. The debt financing structure, how these companies allocate payments for its debts from its net income; and how credit becomes important to their overall operations. And lastly the structure and challenge a multinational firm has with its corporate governance.

The grip on power by the United States on World Economy since the end of World War 2 up until the 1970s has wore down a little bit, since a variety of raw materials, goods, services and including innovative ideas and new technologies coming from different countries who utilizes free flow of their goods and export to different national boundaries (Brigham & Houston, 2007 p. 615). These types of companies who operate in more than one country are called Multinational Corporations (Eldridge, 2010).

As for the US and Canada; in order to remain competitive they also have created multinational companies to maximize shareholder value. Factors like obtaining capital from foreign investors, breakthroughs in foreign laboratories and employing foreign workers have paid well in terms of revenue for top US multinational companies (same as Brigham & Houston, 2007 p. 615). This essay will discuss an overview of potential factors or differences affecting financial management practices for a multinational company.

Then it will study how financial managers cope with a multinational company, what are the main strategies employed and how do they differ by strategies employed on their homeland country; by citing a couple of multinational companies for analysis. Possible factors/Differences affecting the Financial Management of a Multinational Company Operating in a different country a lot of times demands different strategies due to the potential numerous challenges that a firm encounters outside their homeland. The basic factors are Language, Currency, Regulations or Governmental interference and culture.

For American or Canadian firms, depending on the country they plan to operate, English usually becomes a secondary language, as the firm in order to operate effectively needs to adapt the host country’s language. Currency can also be tricky, especially with the fluctuations of currency rates depending on the economic situation of the country being operated on. It could be either advantageous or disadvantageous to the firm depending on the currency’s strength. Firms need to also understand basic regulations and policies imposed by the country’s government, and must follow exactly all those rules to continue operations.

In terms of culture, diversity is another aspect that firms should be aware of treating foreign customers’ right with the knowledge of their culture can be profitable in the long run. Challenges on this aspect can happen if the culture of a different country is not in line with the Multinational company’s goals (Dossing, 2010). Financial Management Practices by Multinational Companies Dividend Policy One important practice of Multinational companies is the provision of a dividend policy. This policy simply means is the provision by companies regarding the amount it would pay to their shareholders as dividend.

With profit making comes the question of utilizing the profit gainfully (MapsXL Inc. , 2009). Financial managers employ this method to either attract more investors or maximize current shareholders value. Thus with this goal in mind firms presents an attractive dividend policy for its investors, but one of the real purpose for multinational companies is mainly to reduce taxation since these companies are now subject to different tax rates and also these different organizational forms has a corresponding tax factors (Desai, 2007).

Usually multinational firms operating on a host country is taxed locally, and then funds repatriated may be subject to US taxes. This US Tax treatment of foreign income has a strong implication to American multinational corporations should not simultaneously remit dividends from low-tax foreign locations and transfer equity funds into the same foreign locations. If this is applied it would generate to what is called a Home-Country Tax liability that can be easily avoided by equity transfers and reduction of dividends. Multinational firms act as though in relation to fluctuations in their earnings, chooses target payouts for their foreign affiliates (Desai, Foley and Hines, 2007 p. 3). This method is quite an important part of multinational financial management as also the pronouncement to repatriate earnings from a foreign subsidiary. The factors that affect the concept of a dividend policy besides the taxation of dividend income are domestic financing and investment needs, including internal agency problems (same as Desai, Foley and Hines, 2007 p.

Managing Ownership

Managing ownership is another way managers and directors use when running a multinational company, depending on the goals for possible profit realization, cost reduction and even tax avoidance, multinational firms may opt to use various ownership strategies such as management contracts, joint ventures, subsidiary production, Franchising or licensing, turnkey contracts, marketing contracts, expatriations and mergers and acquisitions.

McDonald’s for example uses its wide influence of media to enter foreign markets via franchising, Under their conventional franchise arrangement, franchisees provide a portion of the capital required by initially investing in the equipment, signs, seating and decor of their restaurant businesses, and by reinvesting in the business over time, but the Company owns the land and building or secures long-term leases for both Company-operated and conventional franchised restaurant sites.

This maintains long-term occupancy rights; helps control related costs and assists in alignment with franchisees . Other Multinational firms may also decide based on the unfamiliarity of the economic environment may elect the host country to be its partner on a joint venture which in turn can help them be familiarized local economic conditions. Microsoft used licensing to ensure that their softwares would not be easily pirated or copied if sold to foreign markets.

Foreign direct investment via a merger or direct acquisition of an existing firm is also a common practice to have the advantages of large economies of scale and easy access of the new local markets. Debt A healthy financial position of a multinational company can be assessed by its proper management of its debt. Managing debt could be a challenging task for any firm’s manager especially those working in a multinational firm, it is always best to ensure that there are enough revenues to even partially repay its debts, even with this challenge, having a global corporation has also its own distinct advantages.

An example is the Coca Cola which is currently enjoying the privilege of a global presence due to strong brand marketing, have uncomplicated access to key financial markets all over the world, this have helped them maintain debt levels by using their debt financing practice to lower overall cost of capital which in turns increase returns on shareowners’ equity . This strategy is a fundamental part of managing debt for multinational companies; firms also look at strong foreign currencies to operate to partly offset debt by repayment from gained profits.

A company like McDonald’s employ the same approach as Coca-cola’s due to its significant revenues and substantial credit availability which can cover its debt repayments (McDonald’s Corporation, 2009 p. 21). Some employs this strategy to further expand their operations, borrowing heavily which can also have adverse effects multiplied also by higher interest rates, which have affected Wal Mart during its early stages before becoming an Global industrial giant it is now, they still do have enough net cash flow provided by its operating activities of continuing operations for payments for its long term debt (Wal-Mart, 2009).

But what if the multinational firm doesn’t have the ability to allocate partial payments for its debts due to low net income, then comes the necessity of credit or borrowings. Being a multinational company, credit becomes more vital since business especially to lesser-developed economies of countries always depend on credit. Multinational firms find countries especially those who have relatively low inflation rates, since this equates to lower interest rates as well, which in turn may appear attractive to most firms who operate globally.

Debt can also be applied by multinational firms such as highly rated companies Berkshire Hathaway and Kraft Foods to find buyers for their debts, this is due to their strong portfolio and almost recession proof product staples (Thomson Reuters, 2010). Corporate Governance One characteristic that stands out of a multinational company is its complex corporate governance in which is the responsibility of its board of directors to ensure continuous monitoring of its management from its homeland and its foreign affiliates.

The purpose of the headquarters or parent corporate governance is to align all of its policies across its subsidiaries internationally. A challenge can occur here, when the factors of different cultures and divergent backgrounds collide with the bundle of specific governance . An approach for any specific country can almost be executed independently of the firm’s interest and operations in other parts of the world.

The purpose of this so-called bundled corporate governance is in direct relation to the principle of value maximization, in which the bundle of corporate governance mechanisms is designed in order that the benefits and advantages from the bundle monitoring and bonding mechanisms can be achieved with the minimum possible costs.

Conclusion

In order for a firm to stay competitive especially in a Global Market, they employ various financial management practices to adapt to their position. This study have discussed some of those approaches such as the use of Dividend policies to reduce taxation and to benefit from its cost savings, The way multinational companies use different types of ownership for both market entry and to sustain growth, How do they handle debt and values credit especially on low inflation countries and finally the structure of the corporate governance and how it applies specific bundles for its subsidiaries. These practices are all important to consider ensuring long term growth and continuous profitable operations by such multinational firms.

Reference

1. Brigham, E. & Houston, J. (2007). Fundamentals of financial management (11th ed. ). Cengage Learning.
2. Costello, A & Costello, T. (2010). Corporate Governance in Multinational Corporations. [doc] Retrieved from May 03, 2010 < http://www. cobacourses. creighton. edu/MAM/… /Costello%20and%20Costello. doc>
3. Desai, M. (2007). Taxation and Global Competitiveness. [PDF] Retrieved from May 03, 2010 < http://www. people. hbs. edu/mdesai/desai%20%282%29. pdf>
4. Desai, M. Foley, C. & Hines, J. (2007). Dividend Policy inside the Multinational Firm. [PDF] Retrieved from May 03, 2010 < www. people. hbs. edu/ffoley/dividends. pdf >
5. Dossing, H. (2010). How Multinational Corporations Maximize Shareholders’ Wealth. Retrieved from May 03, 2010 ; http://multinationalexpansion. suite101. com/article. cfm/how-multinational- corporations-maximize-shareholders-wealth;
6. Eldridge, G. (2010). Multinational Corporations. Encyclopaedia of Business, (2nd ed. ). Retrieved from May 03, 2010 ; http://www.referenceforbusiness. com/management/Mar-No/Multinational- Corporations. html;
7. MapsXL Inc. (2009) Dividend Policy. Retrieved from May 03, 2010 ;http://finance. mapsofworld. com/dividend/policy. html;
8. McDonald’s Corporation (2009). Annual Report 2009. [PDF] T
9. he Coca-Cola Company (2009). Annual Report 2009. [PDF] Thomson Reuters (2010). Companies can be safer than countries. Retrieved from May 03, 2010 ; http://blogs. reuters. com/columns/2010/02/17/companies-can-be-safer-than-countries/; Wal-Mart (2009). Annual Report 2009. [PDF]

LSI GM591 Leadership and Organization Behavior September 9, 2011 According to my LSI, my Primary personal thinking style is avoidance at 80% and my back-up personal thinking style is affiliative at 75%. I agree with my primary personal thinking style, avoidance and my back-up personal thinking style, affiliative. With the avoidance style, I can live life more positively and I can confront the people that cause my distress. With the affiliative style, I can acquire stronger interpersonal skills that will help form healthy relationships. Some of the statements about avoidance are true about me, while others aren’t.

Example of true statements are: having few strong interests, having difficulty making decisions, uncomfortable discussing feelings and self-doubting and self-blaming. Some of the false statements are: lacking initiative, having difficulty establishing relationships, preoccupied with my own concerns, recently experienced something traumatic and feeling overwhelmed by circumstances. If you tally the true and false statements up, then you would see that I have more false statements than true ones, which tells me that I am less avoidance-oriented now.

However, if you look at the definition of avoidance, as avoiding situations that may cause distress, then I would be a more avoidance-oriented person. When I get upset with a friend or family member, then I tend to shut down completely and avoid them for a few days till I am able to discuss what is wrong with me. I also agree with the affiliative style being my back-up personal thinking style because I don’t have a hard time meeting people, I don’t lack effectiveness at work, I don’t avoid group activities, I am able to relax around people and I don’t feel unimportant or disliked.

I might feel lonely sometimes, but everyone does at one point or another. Being in the affiliative style benefits me with being liked and feeling a sense of belonging. I would identify achievement as limiting personal thinking style because it was my lowest scoring percentile at 21%. Being achievement-oriented involves recognizing where your efforts make a difference, deciding on a desired outcome, and setting specific goals to help you accomplish it. I would say that my achievement style is lowered because I feel like my efforts makes little differences, I on’t set goals, and I lack interest. However, I don’t lack initiative at work, I take responsibility for my actions and I don’t blame other people for my problems. In school I don’t do homework to achieve or excel, I just do it to get it done and hopefully pass. My dependent, approval, and conventional personal thinking styles all being at 69% percentile could be preventing me from being an achiever. For me to become more achievement-oriented I need to start pleasing myself and stop focusing on what I think I should be doing and instead do what is important to me.

I am not a manager yet, but I am pursuing that degree and field now. After reviewing my LSI and learning what it all means, I am going to have a hard time achieving a manager type persona. I think that a manager needs to be encouraging and have a high percentile in the humanistic-encouraging style and mine is only at 25%. I am not uncomfortable with interacting with others, nor do I lack close relationships, nor do I have a problem working in groups. However, I do have a difficult time communicating in terms of speaking in public and telling people what do to or how to do something.

Improving my humanistic-encouraging style will improve my ability to lead, manage and teach. Looking back now, it’s weird to see some connections with my growing up strategies with certain personal thinking styles. I remember my mom never making me do any homework or bribing me with rewards if I got all A’s or anything like that, so I have a feeling that had an affect on why I don’t feel a big need to be more achievement-oriented. When my mom got upset with my brother, and me she would just run to her room and I guess, “avoid” us. So, now when I am upset with a friend, I “run” away and let it just pass by.

My mom was always encouraging me to do things and always said that I can do whatever I put my mind to, so I don’t know why my encouraging style is in the lower percentile. I have learned a lot about myself while taking and reviewing my LSI results. This exercise made me aware of knew things about myself, while letting me admit to myself some other things. For example, I had a feeling I had avoidance problems, but taking this survey and it finding out that information made me think that it is actually real and hurting me more than I thought. I would love to improve my avoidance personal thinking style.

?Role Set Analysis is a method that helps people to think through what is expected of them and they could clash and cause other issues. This method helps managers to check whether or not they are using time effectively. It compares existing procedures with current priorities. By using this method it can help to show what the end objective of the job being analyzed should be. There are many advantages of using the Role Set Analysis. It is easy to apply or update, it assists managers to ask certain questions of themselves about their priorities and objectives.

It can also work with a group or team to see if the activities that are being done need to be changed and lastly, it can be used for a entire department or organization to make sure they have the correct resources in the correct places. This process uses a market research approach to a particular job. The data that is collected consists of the expectations of the main individuals or groups that communicates with the person. The main question that needs to be asked is “What do others expect from me? ” instead of “What should I be doing? ” The first step is to accomplish is to identify what the main elements in the role set are.

The next step is to combined the data and the pressures into a logical form. This is done by creating a flow chart to make it easier to review and understand. Once this is completed, the next step is to that the time and priorities that are allocated to each element in the role set is in line with what is actually needed. This can be done effectively by keeping a daily log of what their daily tasks are for a couple of days. This information can be compared with what is being reviewed for change. This information will help to ensure that the analysis that has been created is going to be effective.

Management and Organizational Structure

Given the business situation for Spectrum Brand p. 251, explain how the firm might organize using a Matrix structure for the organization. Spectrum Brands Corporation, after several years of producing and marketing only batteries has diversified by adding pet products, personal grooming items, and lawn and garden care products. To organize the Spectrum Brand, formerly known as Rayovac Corporation, using a matrix structure would involve setting up teams in different departments where lines of authority may intersect. This form of organizational structure is also called a project management structure. Ferrell, Hirt, and Ferrell, 2009). If Spectrum where to develop a pet product that may be battery operated, this may require employees from the pet products division and battery division to work with a project manager and their respective division managers to be successful in the development of this product. This organizational structure would be beneficial in this instance. Explain how the firm could operate using Multidivisional structure. The multidivisional structure or M-form of organizational structure organizes departments into larger groups called divisions.

These divisions could be focused on either a product, region, or customer. There is delegation of decision making authority in a multidivisional structure (Ferrell, Hirt, and Ferrell, 2009). With Spectrum’s diversified marketing, the firm could operate using a multidivisional structure by establishing divisions for each of its products. Discuss which structure would be more effective. Explain. I believe a multidivisional structure would be more effective and beneficial to the Spectrum Brand Corporation as it “helps firms successfully manage the many demands of diversification” (Organizational Structure and Controls p. 47). Since diversification is where Spectrum appears to be headed, the multidivisional structure will allow the company to “(1) enable corporate officers to more accurately monitor performance of each division, simplifying control problems; (2) facilitate comparisons between divisions, improving the resource allocation process; (3) stimulate poorly performing divisions to look for ways of improvement” (Organizational Structure and Controls p. 347). For each of your two organizational structures, give three examples of potential communication problems the structure might cause.

Recommend corrective actions the company can take to address these issues. Matrix Structure -Potential Communication Problem When reporting to two managers employees may not know who to report to on certain tasks. Managers may have different goals or different expectations or routes to meeting a certain goal or deadline. A potential communication problem can arise from different departments collaborating with little to no knowledge of the other.

Corrective Action

To correct these potential communication deficiencies in a matrix organization structure, I recommend management outline all job responsibilities to include reporting assignments according to tasks. Division managers and project managers should also be very detailed and specific on all job tasks collaboratively. Expectations and exact means to meeting goals and deadlines should be clearly defined with employees should problems in communication arise.

If a communication problem occurs due an issue with the lack of knowledge of a product or task management should immediately assess the deficiency and provide any training or even cross train departments to eliminate such occurrences. Multidivisional Structure-Potential Communication Problem Employees may feel less likely to air grievances. Employees may have different views or innovative ideas but feel reluctant to communicate these to management. Some product knowledge may not be shared across divisions although under the same company. Corrective Action The corrective action I would recommend for potential communication problems n a multidivisional organizational structure would include always including select lower level employees in decision making. I would also recommend cross training employees to learn other products the company markets. For each of your two organizational structures, recommend the degree of centralization that would be most effective. Explain. For a matrix structure the degree of centralization that would be most effective would be a decentralized organization. With this degree of centralization, “decision making is delegated as far down the chain of command as possible” (Ferrell, Hirt, and Ferrell, 2009 p. 44) . In a multidivisional structure a centralized organization would be most effective because of the many divisions its comprised of. In a centralized organization “authority is concentrated at the top and very little decision making authority is delegated to lower levels” (Ferrell, Hirt, and Ferrell, 2009 p. 243).

References

1. O. C. Ferrell, (2009 Custom Edition). Business: A Changing World, Seventh Edition.
2. McGraw-Hill. Organizational Structure and Controls. Retrieved May 2010 from http://asso. nordnet. fr/adreg/hitt%20et%20al%20chapitre%2011%20structure%20et%20controle. pdf

Bureaucratic control is the use of rules, policies, and hierarchy of authority, written documentation, reward systems, and other formal mechanisms to influence employee behavior and assess performance. It is control through a system of rules and standard operating procedures that shape the behavior of divisions, functions, and individuals (Bateman-Snell, 2008). What are the pros and cons of bureaucratic controls such as rules, procedures, and supervision? The pros of rules, procedures, and supervision cause an organization’s personnel to focus on those behaviors that management requires or desires.

They provide employees with a set of day-to-day guidelines with which they can function. By observing the rules and procedures, people do what the system requires. In contrary, they can also result in rigid and inflexible behavior. Employees become accustomed to obeying the rules and doing nothing more. They often make the organization slow to react … and stifle creativity and innovation (Bateman-Snell, 2008). Would you rather work in an organization that uses teams and does not have supervisors?

Teams are cohesive units of people who enjoy the privileges of making decisions and continuously work to improve the organization. They help to align the organization around the functions and they have the ability to work toward a common vision. Teamwork is a concept where people work together effectively to achieve a common target, so teamwork is an important factor for the success of an organization. In times of change, managers and supervisors can be both the greatest ally and the greatest obstacle for change teams.

They are the closest to the employees who must adopt the new processes and behaviors associated with a project or initiative. In many cases, the work of managers and supervisors will also be impacted by a project. Getting managers and supervisors on-board and taking the lead in supporting employee change is crucial (Bateman-Snell, 2008). As much as it sounds good to work for an organization that uses teams without supervisors, I personally would not want to work for one.

Although I work well independently, I also enjoy working with teams, especially with a leader. The President of my organization believes in teamwork and often uses the cross-functional type of teams when working on various projects. Due to my position, I’m usually pulled to be one of the team members. Our teams are usually pulled together from various departments (e. g. Student Services, Academic Affairs, etc. ) to deal with specific service, issue, customer, problem or to improve a particular process.

We meet on a regular basis to analyze our customer (faculty, staff, students and other departments) needs, solve problems or find resolutions, provide departmental support, promote continuous improvement, and share information with each other. I’m very fortunate that my organization believes in teamwork. Bateman-Snell. (8th ed). (2008). Leadership. In Management: Leading and collaborating in a competitive world. McGraw-Hill. Bateman-Snell. (8th ed). (2008). Managerial control. In Management: Leading and collaborating in a competitive world. McGraw-Hill.

Case study in organizational behavior

            The case study mentioned in the paper is about Leo Burnett Company that is an advertising agency and Ontann Beauty Care who are its client, and how they use the concepts of organizational behavior and its theories while their decision making process.

Leo Burnett Company

           Leo Burnett Company is a North American company that was founded in 1935 in Chicago and is one of North America’s premier advertising agencies and has made many famous brands. LB is an international company that has 93 offices in 84 markets and has 9000 employees working for the company. They have a multidisciplinary team that is specialized in various services. Their workforce mostly consists of young employees who work efficiently for around 60 hours weekly.

Ontann Beauty Care

            This company is an international manufacturer of health care products. By the end of 1990’s, the company centralized the global marketing of its brands and products. Moreover, an international team was also designated in order to develop communication that could also be followed by the local market.

            The relationship between Leo Burnett Company and Ontann Beauty Care is that both the companies were founded in Chicago and OBC was one of LB’s original clients and both did their business together. (Seijts, 2005).

             OBC launched a skin care product by the name of “Forever Young” and LB was the agency that was supposed to advertise for the product and the product was to be launched internationally. However, the pre-launch research conducted in Canada showed positive results but it was vice versa when the company actually launched the product on a national level. The sales of the product were very less as they were expected to be. Therefore, in order to create a competitive advantage for the brand “Forever Young,” in Canada, it was necessary that the team that was responsible for Canada was to have extensive knowledge about the demand and the reaction of the people towards the launch of the brand. Compared to other countries, Canada was the place where there was a high demand of such products. However, it did not prove to be right for OBC.

            While comparing Canada and London, more knowledge of the brand was found in London where there was a greater demand of the skin care products than their demand that existed in Canada, therefore the prospective consumers of skin care products and the target market should be made aware of the product in order to create market awareness that would further create attractiveness of the consumers towards the brand.

           The client’s responsibility was to do a proper pre-launch research that could have helped them at the time when they has planned the national launch. As the brand was launched in many different countries such as in Canada, UK and Taiwan, people in all three countries reacted differently towards the brand. It was more successful in Taiwan and the sales were pathetic in Canada.

           Furthermore, as the London based global vice president of skin care was retiring, the client considered to create a global virtual team so that the team could be managed, having their headquarters at the United States that consisted of the members of the original United Kingdom OBC team that was preparing for a launch in the United States. However, if the team had their headquarters in North America, it is not necessary for the Leo Burnett Company to totally base the structure of its team in this way. This is because if both parties exist in the United States, it would not be as much difficult for the team to interact and communicate with each other while working in the US as it would have been if the team would have been in the UK while having their headquarters in the US.  The importance of managing a team virtually is that it saves both time and money and interaction between people can be done easily and this would basically the most suitable option if the headquarters of Leo Burnett Company being in North American have their client in some other country.

             If Carmichael decentralized the brand giving the team of Toronto more autonomy, Tara Powell would lead the brand in Toronto after Davids leaves the agency because she was the one who used to report to Davids and is expected to have most of the know-how. (Neil, 2003). However, once he leaves the agency, a new leader will have to be appointed and a leader is basically there to guide the other people, therefore he must have certain knowledge so that he can manage things in an orderly way while taking care of efficiency and effectiveness. The new leader should have the knowledge of conducting a proper research before launching the product after which the results should be evaluated well and then the advertising campaign should be launched to make more and more consumers aware of the presence of the brand.

            In case if they remain centralized, the team would not be make it through before it self-destructured. This would surely risk the relationship with the client in a way that the sales of the client would not meet up their targets and this could strain the relationship between them. Furthermore, the budget that has been allocated could not be further increased so they have to manage somehow in the finance that is allocated for them.

            Carmichael is supposed to take a decision, however the decision that they will take should be preeminent for the brand, Leo Burnett Company and Ontann Beauty Care, therefore they must go for decentralizing. This should be done because it is an international company that is operating in many different locations and the needs and the requirements of the people in different countries vary. Therefore, the team responsible for a particular country should be given power so that they can work without being given orders that might not suit the country they are operating in. The team must not be given full power, they should always know that they are accountable but they should have at least enough power that can make them do their work well. (Judge & Robbins, 2007).

                                                                     References
Judge,T. & Robbins,S.P. (2007). Essentials of Organizational Behavior. 9th Edn.  Prentice Hall,

            Paperback.

Neil,O’Elizabeth. (2003). The Leo Burnett Company Ltd: Virtual Team Management. Pgs 161-
175.
Seijts,G.H.,(2005). Cases In Organizational Behavior (The Ivey Casebook Series). 1st Edn. Sage
Publications, Inc; Paperback.