Tara Barker president of Allen Autoparts was deeply concerned about being competitive in a new environment. As the company prepared to enter China, it was evident that additional effort was needed to exercise better control, reduce costs, and become more efficient. The type of environment in which a firm operates can have a significant effect on the type of control and communication system chosen and implemented. Consider for example , a firm that produces concrete pipes and blocks. The products and production processes are well defined and relatively stable. Functional skills are specialized to gain operating efficiencies. Interactions with suppliers and customers are mostly limited to arm’s-length transactions. Competition tends to be local or regional as opposed to national or international. A successful firm operating in this type of environment would tend to emphasize maintaining the status quo: preservation of market share, stable growth, and continuation of efficient production.