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1 – 10 of over 7000Bent Petersen and Rene E. Seifert
The chapter provides an economic explanation and perspectivation of strategic asset seeking of multinational enterprises from emerging economies (EMNEs) as a prominent feature of…
Abstract
Purpose
The chapter provides an economic explanation and perspectivation of strategic asset seeking of multinational enterprises from emerging economies (EMNEs) as a prominent feature of today’s global economy.
Approach
The authors apply and extend the “springboard perspective.” This perspective submits that EMNEs acquire strategic assets in developed markets primarily for use in their home markets.
Findings
The authors succumb that the springboard perspective is alluring theoretically as well as empirically as it suggests that when EMNEs acquire strategic assets, they experience liabilities of foreignness (LOF) that are low relative to those of MNEs from developed markets. The authors concede to this LOF asymmetry but also point out that liabilities of outsidership (LOO) can offset or weaken the home-market advantage of some EMNEs when competing with MNEs.
Research implications
LOO appears as the more relevant concept to use when explaining strategic asset seeking of EMNEs. A set of propositions are formulated to guide empirical testing.
Originality/value
The insights gained from using the springboard perspective and the LOO concept are non-trivial: They basically predict future dominance of ‘insider’ EMNEs at the expense of MNEs from developed markets.
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Frank Ohara and Robert Neil Mefford
This study aims to examine the corporate venturing strategy of successful emerging market multinational enterprises and discern commonalities and useful tactics for other firms…
Abstract
Purpose
This study aims to examine the corporate venturing strategy of successful emerging market multinational enterprises and discern commonalities and useful tactics for other firms attempting to follow in their footsteps. Understanding the corporate venturing strategies used by these successful firms may be instructive for other firms whether from emerging markets or developed countries.
Design/methodology/approach
We selected 11 multinationals in emerging markets for this study, from a variety of industries in China, India, Brazil, Mexico, Taiwan and South Korea. Success here is defined as rapid international expansion, increased revenue and greater innovation capacity. These firms have become globally competitive against established companies from the developed countries.
Findings
Some commonality in corporate venturing strategy has been found along with factors that have contributed to this use being effective. They may provide some worthwhile examples for other firms, both in developing and developed countries.
Originality/value
The contributions of this research are to add to the understanding of how some multinationals from developing countries have been able to rapidly build up their capabilities to become successful global competitors through their corporate venturing strategy.
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Upon entering developed markets, emerging market multinational corporations (EMNCs) from China and India must compete with both host companies and other developed nation MNCs to…
Abstract
Purpose
Upon entering developed markets, emerging market multinational corporations (EMNCs) from China and India must compete with both host companies and other developed nation MNCs to attract and recruit necessary local talent. The purpose of this paper is to examine to what extent EMNC firms will be perceived as less attractive employers than their developed nation counterparts due to a perceived liability of origin bias. Major demographic and psychographic factors that may affect this bias will also be identified.
Design/methodology/approach
Seven hypotheses were tested on a total of 626 German, French and American respondents. Participants were randomly presented identical job descriptions from four hypothetical MNCs (American, European, Indian and Chinese) and were asked to evaluate the perceived attractiveness of working for, as well as their intent to pursue employment with, the offering firm.
Findings
Using hierarchical linear regression testing, combined with analysis of variance testing, EMNCs were found to have significantly lower organizational attractiveness than equivalent European or American owned MNCs. Mixed results were found for the various hypotheses based on the moderator variables.
Research limitations/implications
Because the study included three distinct sub-groups, supplemental analyses controlling for possible variances between the sub-groups themselves are included. This multicultural study is one of the first to address the human perspective of EMNC outward foreign direct investment (OFDI) by identifying the existence of a potential liability of origin bias toward emerging market firms manifested by potential developed market job applicants. Furthermore, this study is one of the first to examine the influence of applicant age, professional status, gender and nationality with respect to the differences in the perceived level of organizational attractiveness between emerging market and developed nation firms.
Originality/value
This paper extends the literature in three important research areas. First, an extension to the literature on the highly relevant topic of OFDI by Chinese and Indian firms is made. Second, traditional research in the field of organizational attractiveness is further extended by combining it with the timely subject of Chinese and Indian OFDI into developed markets. Finally, this study extends international business literature by studying the influence of demographic and psychographic moderators on the perceived level of organizational attractiveness between emerging market and developed nation firms.
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Elitsa R. Banalieva, Laszlo Tihanyi, Timothy M. Devinney and Torben Pedersen
Do multinational enterprises evolve differently in emerging and developed economies? Although one camp argues that emerging economy multinationals are different from their…
Abstract
Do multinational enterprises evolve differently in emerging and developed economies? Although one camp argues that emerging economy multinationals are different from their developed country counterparts owing to the underdeveloped institutions in their home countries, another camp counters that they are the same and the existing international business theories can fully explain their strategies. A third camp suggests a more nuanced perspective by finding value in both approaches. In this introductory chapter, we review this debate and offer new perspectives on how to extend existing theories by accounting for four specific aspects of the home country institutional environments of emerging economies: breadth, depth, timing, and duration of exposure to institutional development. We then discuss how the chapters in this volume extend these ideas.
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In developed markets, emerging market multinational enterprises (EMNEs) seem to be more discriminated by host country nationals than foreign developed market multinational…
Abstract
Purpose
In developed markets, emerging market multinational enterprises (EMNEs) seem to be more discriminated by host country nationals than foreign developed market multinational enterprises (DMNEs). They are challenged with host country nationals’ prejudices and face a stigma of being from emerging markets. While literature agrees that EMNEs suffer from additional disadvantages due to their country-of-origin, research fails to identify those factors that may lead to a higher discrimination against EMNEs than against foreign DMNEs.
Design/methodology/approach
Based on institutional theory, we look at institutional-related and resource-related antecedents that have an impact on various forms of direct and indirect discrimination by host country nationals.
Originality/value
Our framework analyzes the crucial differences between host country nationals’ perception of EMNEs and foreign DMNEs and the resulting challenges for EMNEs in the developed world. It enhances our understanding of the importance of institutional environments in explaining differences in host country nationals’ discrimination against foreign MNEs.
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The purpose of this study is to provide an integrated framework that conceptualizes multifaceted antecedents pertaining to international expansion of emerging market businesses in…
Abstract
The purpose of this study is to provide an integrated framework that conceptualizes multifaceted antecedents pertaining to international expansion of emerging market businesses in relation to firm performance. This paper develops multiple-item measures of multiple dimensions to clarify ownership structure and three diversification strategy relationships to performance. We test how ownership structure and diversification strategy affect emerging market multinational enterprises’ financial performance. The result shows that the relationship between ownership structure and firm performance is a nonlinear relationship (S shape). We also found that excessive international diversification, product diversification, and geographic scope of the expansion process negatively moderate the impact of Asia Pacific multinational enterprises’ performance.
The purpose of this paper is to show that existing theories, principally Dunning’s OLI model, Mathews LLL model and Rugman’s version of internalization theory are unable to…
Abstract
Purpose
The purpose of this paper is to show that existing theories, principally Dunning’s OLI model, Mathews LLL model and Rugman’s version of internalization theory are unable to explain the rise of emerging market multinationals (EMNEs). The reason is that they over-emphasize the strategic importance of intangibles and ignore that of complementary local assets. Taking complementary local assets into account makes it possible to understand why EMNEs are able to finance their intangible-buying sprees and, often with the help of their governments, to swap market access for technology.
Design/methodology/approach
This is a conceptual paper based on the bundling model (JIBS 2009) and backed by the case histories of four EMNEs.
Findings
The author shows that EMNEs have much better prospects vis-à-vis established MNEs than generally thought in Western Europe and the USA and that they will become serious competitors.
Originality/value
This is, as far as the author knows, the first explanation of why EMNEs have the bargaining power and the resources necessary to swap or buy technology from established MNEs.
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Luis Alfonso Dau, Elizabeth Marie Moore and Margaret Soto
The purpose of this chapter is to examine how multinational firms have an added incentive to promote corporate social responsibility (CSR) in order to maximize profitability and…
Abstract
Purpose
The purpose of this chapter is to examine how multinational firms have an added incentive to promote corporate social responsibility (CSR) in order to maximize profitability and adapt to the changing normative climate in a post Great Recession economy.
Methodology/approach
This chapter builds on institutional theory using contextual evidence from Mexican firms to provide insight into the varying pressures facing local and multinational enterprises in emerging markets.
Findings
This chapter highlights different sets of pressures faced by emerging market firms, both domestic and multinational. This chapter contends that emerging market multinational enterprises (EMNEs) are incentivized to uphold CSR practices to a greater degree than domestic firms from emerging markets.
Research limitations
Contextual evidence for this chapter was confined to Mexican firms, which provides an opportunity for future research to be carried out from alternative emerging markets.
Social and practical implications
From a social standpoint, this chapter sheds light on the challenges of globalization and the current rift between national level policies, coinciding behavior, and global expectations. From a practical standpoint, this chapter could inform and alert CEOs and practitioners to the nuances of CSR expectations, contingent upon the sphere in which they choose to operate in.
Originality/value
This chapter contributes to the growing dialogue on EMNEs while highlighting the schism between national and global expectations for CSR. Further, this chapter adds to the literature on institutional theory by connecting it to the in-group and out-group literature from sociology.
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The purpose of this paper is to examine entry modes employed by foreign multinational manufacturing enterprises entering Russia. It is designed to discover how multinational firm…
Abstract
Purpose
The purpose of this paper is to examine entry modes employed by foreign multinational manufacturing enterprises entering Russia. It is designed to discover how multinational firm decision makers perceive country conditions in Russia and to provide the basis for further study to uncover what factors influence their decision to locate manufacturing in such volatile markets rather than employing other, less riskier modes of entry.
Design/methodology/approach
This paper uses in‐depth interviews of decision‐makers operating foreign manufacturing firms in different industries in Russia. Under the author's guidance, the interviewees discuss open‐ended questions concerning country conditions in Russia, their evolution and effect on entry modes. The interviewers take notes which are shown to the interviewees at the end of each interview to make sure the notes represent the true and unbiased views of the interviewees.
Findings
Finally, favorable economic conditions and large multinational firms' internal factors seem to have become the single decisive factor affecting these firms decision to use the riskiest mode in Russia which described in some literature as one of the least stable emerging markets.
Research limitations/implications
The paper is limited to a small number of cases and qualitative research.
Practical implications
This paper is an insight into country conditions in emerging economies.
Originality/value
Country conditions in emerging markets have not yet been considered from this perspective and effects of all have been studied. However, effects of globalization on large firms adaptability to country conditions have been overlooked by scholars.
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Stéphane J.G. Girod and Joshua B. Bellin
Using Triad-based multinational enterprises as their empirical setting, influential scholars in international management uncovered key organizational characteristics needed to…
Abstract
Using Triad-based multinational enterprises as their empirical setting, influential scholars in international management uncovered key organizational characteristics needed to create globally integrated and locally responsive multinationals. They proposed a “modern” theory of multinationals' organization (Hedlund, 1994). But recently, a new generation of multinationals from emerging markets has appeared. Little is known about their organizational choices and some scholars even doubt that they leverage organizational capabilities altogether. Does the “modern” theory still hold in their case? This exploratory study of three emerging-market multinationals (EMNEs) discloses that for reasons related to their origin in emerging economies and to the competitive specificities of these economies, EMNEs approach the global and local conundrum in ways which are both similar – and vastly different – from recommendations of the “modern” theory. We inductively develop a new theory that accounts for the evolution of organizational capabilities in EMNEs to reconcile global integration and local responsiveness. We discuss its implications for the executives of both emerging and Triad-based multinationals.
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