How EMNEs choose location for strategic asset seeking in internationalization? Based on strategy tripod framework

Qiuling Gao (Business School, University of International Business and Economics, Beijing, China)
Zijie Li (University of International Business and Economics, Beijing, China)
Xinli Huang (The University of Western Australia, Crawley, Western Australia, Australia)

Chinese Management Studies

ISSN: 1750-614X

Publication date: 5 August 2019

Abstract

Purpose

Based on the strategy tripod perspective, this study aims to address how emerging economy multinational enterprises (EMNEs) make a strategic decision of choosing a foreign location for their strategic asset seeking and under what mechanism EMNEs make foreign direct investment (FDI) location choice.

Design/methodology/approach

This paper first reviews the literature on strategy tripod and strategic asset seeking strategy of EMNEs. Then, six cases of Chinese multinational enterprises operating in manufacturing industry have been introduced, emphasizing on interactions within three dimensions of strategy tripod framework, namely, resource-based dimension, industry-based dimension and institution-based dimension. By triangulating with multiple sources of archival and interview data, this paper identified a conceptual model presenting location choice mechanisms.

Findings

Based on a comparative multi-case study, four mechanisms of EMNEs’ location choice when seek strategic asset by FDI within a strategy tripod framework have been revealed. Specifically, EMNEs make their strategic decision of choosing a foreign location for their strategic asset seeking under mechanisms of seeking complementary resources based on industry characteristics; echoing with institutional dimension of home country when exploitation of resource; matching institutional dimension of host country when consider industry fitness; and institutional leveraging combined with understanding of resource and industry dimensions inside strategy tripod.

Originality/value

The findings shed novel insights into the mechanisms under which EMNEs choose their location for strategic asset-seeking FDI. It also broadens the strategy tripod framework by looking deeper into the characteristics of each dimension within a new research context of EMNEs’ FDI location choice.

Keywords

Acknowledgements

The authors thank their CMS reviewers for their valuable feedback and guidance throughout the review process. They also thank the financial support from the National Natural Science Foundation of China (Grant No. 71872043, 71772038), and Scientific Research Innovation Fund for Postgraduates of University of International Business and Economics (Grant No. 201805).

Citation

Gao, Q., Li, Z. and Huang, X. (2019), "How EMNEs choose location for strategic asset seeking in internationalization? Based on strategy tripod framework", Chinese Management Studies, Vol. 13 No. 3, pp. 687-705. https://doi.org/10.1108/CMS-06-2018-0573

Publisher

:

Emerald Publishing Limited

Copyright © 2019, Emerald Publishing Limited

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