Regardless of the thoroughness of the planning done, a program or decision still may be poorly or improperly implemented without a satisfactory control system in place.
Controlling is that process of regulating organizational activities so that actual performance conforms to expected organizational goals and standards. While interrelated with all of the other management functions, a special relationship exists between the planning function of management and controlling. Planning, essentially, is the deciding of goals and objectives and the means of reaching them. Controlling lets manager tell if the organization is on track for goal achievement, and if not, why not. A well-developed plan should provide benchmarks that can be used in the control process.
Read more: MGT503-Princilpes of Management-Lecture Handout No 44
Companies may accumulate foreign assets through acquisition (buying them) or by building these assets themselves.
In order to acquire a foreign asset, firms usually move capital from one country (often the home country) to the country where the newly acquired facility is located (the host country). Sometimes, if the firm already has operations in the host country, it can simply use revenues from host country operations to acquire another facility. In such instances, no international capital movement would occur.
Instead of buying an existing foreign operation, the investing firm might decide to build a new facility from scratch.
Reasons for buying: The investing company might wish to acquire a locally existing name brand, might
wish to avoid adding additional capacity to the industry, might wish to avoid having to hire and train new
workers. Furthermore, by buying an existing company, the investor avoids inefficiencies during the start-up
period and gets an immediate cash flow rather than tying up funds during construction.
Reasons for building: Companies often make investments where there is little or no competition, so
finding a firm to buy may be difficult. Furthermore, when acquiring a firm, the investor inherits all the
problems that exist in the firm. Finally, a foreign company may find local financing easier to obtain if it
builds facilities.
Read more: MGT520 - International Business - Lecture Handout 33