Is the Governance of Transnationals Really ‘Beyond the M-form’? A Critical Review of Bartlett and Ghoshal’s ‘New Organisational Model’

Abstract

In a series of articles and books published over the last 13 years, Bartlett and Ghoshal have described and analysed the evolution of multinational companies with a particular focus on the functioning of the so-called transnationals such as ABB, General Electric, 3M, Toyota and Canon. Their approach has been heavily managerial in the sense that ‘the model was developed by analysing the operations of a firm from the perspective and in the language of the managers who live within the system’ (Bartlett and Ghoshal, 1993: 117). In their view, managers of transnationals tend to lead their company more by influencing cultural, social and psychological processes than by influencing strategy, structure and system. They contend that their roles have evolved so radically as to make them significantly different from those typically found in M-form organizations (Chandler, 1962, 1986; Williamson 1971, 1986, 1981). In their view the classic responsibilities of M-form leadership comprise the formulation of corporate strategy, the design of formal structure and the implementation of systems of control. In the last decade, in the context of the transnational, Bartlett and Ghoshal contend that each of these has been respectively replaced by three distinctively new responsibilities. The first involves an emphasis on shaping institutional purpose in such a way that employees can identify with it and commit to it. The second is the development of organisational processes that both capture individual initiative and create supporting relationships.