Regional Headquarters as Multinational Global Strategies

The concept of Regional Headquarters (RHQ) was devised as part of the way in which multinational corporations are organized. The idea of the RHQ also challenged the American multinationals, which so far have dealt mainly with domestic markets, to incorporate regional strategies into the framework of their management organization, leading to the creation of a new model (matrix organization) through the combination of product and regional organizations. I have been studying regional strategies and structures of multinationals, especially comparative studies of Japanese and American multinationals and RHQs, since 1987. I visited the RHQs of Japanese companies in North America and interviewed their executives and managers. Since the Japanese yen was strong at the time, foreign investment by Japanese companies in developed countries was increasing rapidly. In the latter part of the 1980s, when the so-called Bubble Economy was coming to an end, the total annual amount of foreign investments reached its peak, at US$67.5 billion, and large Japanese multinationals established a number of business units within the same region.