 We are discussing about stages of internationalization of an organization, and this is the fourth stage and the one which corresponds with the network of subsidiary stage in the stages of internationalization model. And this is the stage of global product area division. Whether the organization can have a global product division structure, or it can have a global area division structure. So when your international operations are very much spread and your international sales are growing, then either you can go towards the product division structure, if your multinational is making different products, then you can go towards the product division structure, or if your organization is making only one product or are making a few products, then you can go towards the area division structure. Let's take a look at both of them. This is a global product area division structure, a combination of both of them. In the first layer, you can see that this is a product division structure. And on the second layer, you can see that area divisions have also been added. So if an organization is producing three products A, B and C, if they want to go for a product division structure, they would have one worldwide production group or division A, worldwide production group or division B, worldwide production group or division C. And now if they are even more complex, they can go for an area division as well. For example, if they are making one product whose overall management is worldwide production of that product, for example product B, and then they are selling in the entire world, then they can also go for adding the area structure in that. So this diagram you can see that area one is concerned with domestic sales and area two is concerned with international sales. And then under that, there are functional units under each area operating in the domestic and international domain. So basically this diagram is showing you how a product division structure operates. This is particularly a global area division structure in which the organization is divided into various geographical areas. So it may be divided into North American area, Latin American area, European area, Middle East African area, Far East area, but that is hypothetical. In real terms, the organization will have those divisions in geographical terms in which they are operating. Examples of product division structures or area division structures could be found in many different multinationals. For example, you may have heard of the auto company Voxvegan, but Voxvegan is a parent company of many automobile companies which are known to you as separate companies. For example, Audi, Bentley, Porsche, Scorda, CR and many other automobile companies, they all are owned by Voxvegan Corporation. Now Voxvegan Corporation, because it is selling all these different products, they are selling Audi under a different brand name, they are selling Bentley under a different brand name, they are selling Porsche under a different brand name. So basically their products are diversified. So according to that, they have a global product division structure in which they have worldwide production facilities which are catering to each product. Whereas if you look at Coca-Cola, now Coca-Cola has got one type of product, Coca-Cola or there are different variations, but the product is made in the same factories. So they would not be going for a product division structure. They would be going for an area division structure. So they would have an area division which is related with the America, with the Europe, then with the Far East, with the Middle East, with Central Asia and all the geographical divisions which are possible in which they are operating. Why do we go for a product or area division structure? Because growth and size, they create issues of communication. So then you want to go for a complete division which is looking after a particular area or it is looking after a particular product. So you want to completely give them the autonomy. And you also want to give them the autonomy because their tensions may emerge as corporate managers, they pull for more control between the corporate managers and subsidiary managers. So subsidiary managers, they would want more autonomy and corporate managers, they would want more control. So there would be tensions coming up. But to make it more efficient, you need to delegate. In current scenario, particularly, we are going for delegation of authority, decentralization, participatory management styles. So in order to do all that, when your volume gets that big, you need to give autonomy to your international functions. And then there is always dilemma between national responsiveness and global integration. Either on one side, you want to be globally integrated. You don't want to be completely located in the local market. You want to have a company which is globally integrated. But yet you also want to be nationally responsive in which you are responsive to the needs of that particular country and the local market. So there is always dilemma. And to resolve that dilemma, you have to go for a global division structure. All right, so if the growth strategy, it involves product diversification, then you go for a product division structure, global product division structure. And if growth strategy that involves geographical expansion, then global area division structures will be established. When you're growing at that extent, then there would be a number of implications for your organization. So number one implication you would have heard this sentence many times is think global, act local. So you need to think globally, but you need to act locally. That is the first implication. Then it is an extremely complex environment and it includes global competitors, global customers, universal products. So you have universal products, you are selling your product to the entire globe. So your customers are global, your competitors are global, your products are universal. Then you have world scale factories, factories which are producing that can sell to the entire world. And technological advances, so you will be concerned with all these aspects that are implications of glowing global at that scale.