Is Your Company Multinational, Transnational, International, Regional Or something else? Lessons from Schlumberger’s Shift
https://lnkd.in/gn3aeJTz - the link for the LinkedIn post as an introduction
Out of curiosity, I looked up the current classification of Schlumberger and was surprised to find it categorized as a multinational company rather than what I had long known it to be—a transnational company. This contradiction led me to revisit my old MBA notes from the Managing International Business course taught by Dr. Irham Dilmy and Tengku Nathan Machmud, Ph.D., at IPMI ( IPMI Institute )
In those notes, I found a case study discussing Schlumberger (now rebranded as SLB) and how it was once classified as a transnational company. However, business structures evolve, and so does the way companies are categorized. This discovery prompted a deeper look into how SLB’s organizational model has transformed over time.
1. Schlumberger in the 2000s: A Transnational Company
In the early 2000s, Schlumberger was widely recognized as a transnational company due to its decentralized structure and regional autonomy. Key characteristics included:
This model allowed SLB to adapt to different geopolitical, regulatory, and market conditions while maintaining strong global coordination—hallmarks of a transnational company.
2. The Evolution: What Changed?
Since the 2010s, and particularly after the 2022 rebranding to SLB, the company has undergone major restructuring, shifting towards a more centralized multinational model. Several factors highlight this transition:
These factors indicate a strategic shift away from decentralization—a key reason why SLB is now categorized as a multinational rather than a transnational company.
3. Schlumberger in 2000 vs. SLB in 2025: A Side-by-Side Comparison
This shift is not unique to SLB. Many companies that were transnational in the 1990s and early 2000s have moved toward a more centralized multinational model. The rise of digital transformation, cost-efficiency strategies, and the need for stronger global coordination has pushed many firms to standardize operations while reducing regional autonomy.
4. Conclusion: A Reflection on Changing Business Models
Was Schlumberger once a transnational company? Yes. Is it still one today? Arguably no. The company’s transition reflects broader global business trends, where firms move between classifications based on market conditions, corporate strategy, and industry dynamics.
This realization reinforces an important lesson: business models evolve—what was true decades ago may no longer be the case today. The classifications we once learned in business school must be constantly revisited as companies restructure and redefine their strategies to meet the demands of an ever-changing global economy.
Reflecting on this, my initial surprise at SLB’s classification change has turned into a deeper appreciation of how business structures adapt over time. Revisiting my MBA notes from IPMI provided a reminder that knowledge is dynamic—just as businesses evolve, so too must our understanding of them.
领英推荐
B. Is the company you are working for international/ multinational / transnational / global / regional/ domestic company?
International, multinational, transnational, global, regional, and domestic companies differ in their market reach, operational strategies, and degree of localization. Each type of company reflects a distinct approach to business expansion and integration. Below is a detailed explanation of each category, including examples relevant to Asia:
1. International Companies
International companies engage in business across multiple countries but primarily focus on exporting their products or services rather than deeply integrating into foreign markets. Their operations remain centralized in their home country, with minimal adaptation to local consumer preferences. These companies rely on strong brand recognition to generate revenue from international markets. Shin Ramyun (Nongshim), a South Korean instant noodle brand, is an example of an international company. It exports its products to many countries, including China, Indonesia, and Japan, but the recipes and branding remain largely standardized across different markets.
2. Multinational Companies (MNCs)
Multinational companies establish subsidiaries or local branches in multiple countries and tailor their products, services, and business strategies to suit local market conditions. While they maintain a strong home-country headquarters, they grant operational autonomy to their regional divisions. Toyota, headquartered in Japan, is a classic example of a multinational company. It manufactures vehicles in different countries, adapting models to local preferences, such as producing smaller, fuel-efficient cars for Southeast Asian markets while offering larger SUVs in India.
3. Transnational Companies
Transnational companies operate with a decentralized structure, fully integrating their global operations while maintaining local responsiveness. They do not function with a single dominant headquarters but rather as a network of regional hubs with shared decision-making. Unicharm, a Japanese company specializing in hygiene products, follows a transnational approach. It adapts its diapers, sanitary napkins, and personal care products to different cultural and regulatory requirements while maintaining a unified global strategy. For example, it modifies product sizes and materials based on the climate and consumer habits in different Asian countries.
4. Global Companies
Global companies prioritize brand consistency and operational efficiency by offering standardized products and services worldwide. They minimize local adaptations to maintain uniformity in quality and marketing. Samsung, a South Korean electronics giant, exemplifies a global company. Whether in China, India, or Southeast Asia, Samsung’s smartphones, TVs, and home appliances follow nearly identical designs, specifications, and branding across different countries.
5. Regional Companies
Regional companies focus on serving a specific geographic area rather than expanding globally. They tailor their business models to local cultural, economic, and regulatory environments within the region. Grab, a Singapore-based ride-hailing and financial services company, operates primarily in Southeast Asia, including Malaysia, Indonesia, the Philippines, and Thailand. Instead of expanding to Europe or North America, it refines its services for the unique transportation and financial needs of Southeast Asian consumers.
6. Domestic Companies
Domestic companies operate exclusively within a single country, catering to the needs of the local market without expanding internationally. They shape their business strategies based on national consumer preferences, economic conditions, and government regulations. Bank Mandiri, an Indonesian bank, is an example of a domestic company. It provides financial services across Indonesia but does not have a major presence in foreign markets.
Each type of company represents a unique strategy for conducting business in an increasingly interconnected world. The choice of market approach depends on factors such as industry trends, consumer behavior, regulatory landscapes, and competitive advantages.