The Redefinition of the Corporation and the Nation State

The emerging corporate structure of an organization operating in a network of value is significant because it is a prelude to an organizational shift towards a more transnational approach to business. A similar adaptation can be observed to some degree in a shift in the traditional structure of nation states. As stated in previous chapters, any company can now participate in some aspect of global commerce. In fact, it can be argued that all corporations now possess a global potential and must balance factors such as culture, religion, citizenship, social awareness, special interest and other external forces, as illustrated in Figure 4.1. Like national governments, businesses operating in a global network of value must integrate these globally focused aspects of business into strategic thinking; this is especially true when the firm must strike partnerships that span national boundaries. Keeping this in mind, it is clear that in a synconomy two or more firms can partner, affiliate or form an alliance in which a mutually beneficial set of products can be offered to a global audience, in effect creating a virtual transnational company. In the past, small firms were typically prevented from entering remote markets due to the massive investment needed to facilitate international commerce. Today, however, services which were offered exclusively to and by multinational firms such as IBM, Philips, General Motors and other large organizations can now be obtained and to some degree offered by much smaller firms.