Going Global

Despite their desperate need for U.S. investment, the Atlantic Council found, Europeans complain that the American investors' representatives often treat their hosts like cousins. U.S. cor porations are acutely aware of this complaint, and are indeed moving to mind their manners. With as much as half their sales now made outside the U.S., many large corporations have a growing tendency to think and act as global companies with world markets rather than as American companies doing business overseas.

Following this trend, Jersey Standard last week was deep in plans to transfer control of European operations this fall to a brand-new subsidiary called Esso Europe, to be based in London. Esso Europe will oversee a 14-nation area that already sells more oil and gas than Jersey does in the U.S., and where sales are rising three times as fast.

Unlike the long common custom of manning overseas offices with a few U.S. executives and a staff of nationals from the nation in which the office is located, Esso Europe will be a miniature United Nations. Its seven-man board of directors will include an Italian, Frenchman and Briton, its 450-man headquarters staff will comprise many nationalities. Already Jersey has an advance task force in London made up of Italians shopping for homes for Italian executives, Frenchmen seeking out French schools and shops, Americans finding American quarters. "We consider Esso Europe an interim step," says Nicholas J. Campbell Jr., 50, who resigned from Jersey's main board to run the new company, "in getting Europeans to leave their own countries and work for Jersey on a worldwide basis."

Supranational Thinking. Esso Europe is envisioned, however, as a lot more than a talent pool or an experiment in international living. Campbell will control Jersey's European budgeting, marketing and long-range planning. He will direct such supranational Esso activities as its interest in the new Trans-Alpine Pipeline, will even venture into high policy in such matters as contacts with the European Common Market about the new six-nation energy policy that the Common Market is developing.

In its revised approach to international operations and emergence as a multinational company, Jersey is sailing a course plotted by Dow Chemical. "We no longer consider ourselves an American company expanding overseas," says Dow Chairman Carl A. Gerstacker, who this week reported 1965 sales of $1.17 billion, 25% of them from outside the U.S. On Jan. 1, a reorganization plan took effect within Dow under which European operations, which account for $150 million of the sales, were folded into a Zurich-based division called Dow Chemical Europe. The new operating division is run by Zoltan Merszei, 43, a Hungarian-born Canadian citizen, who reports directly to Dow's Midland, Mich., headquarters rather than through an international division; he is responsible for his own budget, product % priorities, advertising and new-business development. "It is better to ask what I cannot do," beams Merszei. "I can do anything to improve Dow profits." Dow has two other divisions for Latin America and the Far East, which will be given the same broad authority that Dow Chemical Europe has whenever their sales grow big enough.

Route to the Top. Corn Products Co. has set up a Brussels headquarters to coordinate operations in 14 European countries instead of having all report to New York. Sperry Rand's computer and office-equipment sales forces in 18 nations are now run out of Lausanne; Merck Sharp & Dohme recently established an office in Brussels to supervise six European subsidiaries. Says Professor Raymond Vernon, international trade specialist at Harvard Business School: "For the first time in history, we're seeing global strategy in terms of corporate entities. What you are seeing is a fundamental reorganization."

Vernon believes that the time is not too distant when one of its European executives will become chief executive of an American company. To get there he will have to compete hard, however, with Americans sent abroad in the new reorganizations. As recently as a decade ago, a U.S. executive dispatched overseas was as likely as not being sent to Siberia. Today such a post is a testing ground for reaching the top. Says Corn Products International Vice President Beverly W. Warner: "For us, Brussels opens the door to New York."

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