BRL Hardy

BRL Hardy came into existence with the merger of two Australian wine producers; BRL, who was a low- cost bulk wine producer, and Hardy, who was a high-end marketer of table wines. Leading the combined company was a CEO who wanted to implement a new corporate strategy of developing global brands and international distribution. The country subsidiary manager, however, was often in direct conflict with headquarters as he sought greater local control over branding, labeling and pricing. This conflict between the perspectives and objectives of the local subsidiary manager and the corporate offices is difficult to manage.

Transnational management issues:

Because of the complexities of the new transnational companies, there are new management challenges that must be met as the global leaders try to get the benefits of global economies of scale, mixed with national flexibility and responsiveness, and the benefits of worldwide learning. Because these goals are sometimes contradictory, the management of these organizations is sometimes very complex and difficult to manage. We saw this difficulty exemplified with the BRL Hardy case in which there were conflicting desires to develop global brand awareness, and the desire to achieve local responsiveness to local market conditions at the same time. As we discussed in class, many companies will find this complexity too difficult to achieve, but may have to give up local flexibility, global efficiency, or worldwide learning if they are not able to do so. In addition to shifting external business factors, there will be new management requirements for companies attempting to internationalize. Companies that are lacking in organizational strength may want to consider selling or licensing technology or brand name, exporting, or franchising as less- risky ways of going abroad. Once a firm internationalizes, they typically run into the dilemma of trying to achieve global scale and local responsiveness at the same time.