Encyclopedia of International Strategic Management, 2024

The success of multinational corporations (MNCs) depends to a substantial part on their formal organizational structure. Yet, defining what exactly organizational structure is, is non-trivial. Building on, organizational structure can be understood as dealing with the fundamental problems of what shall be done (task division) by whom (task allocation to individuals and organizational units), and how the entire set of activities shall be integrated (eg, through coordination and control mechanisms). Organizational structure therefore deals with a very wide range of issues and phenomena.
The MNC literature has essentially approached the wide range of questions of organizational structure in two different ways:(1) macro structures, which embody—at least in their pure forms—specific manifestations of task division, task allocation, and integration;(2) substructures, notably the structure of subsidiaries.