Search results

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.

The purpose of this paper is to clarify how Chinese multinationals perceive factors affecting the integration-responsiveness (I-R) framework.

This study extends quantitative and conceptual studies that have clarified and assessed the underlying factors that influence multinational enterprises’ (MNEs) international business strategy choices relating to global integration and local responsiveness with the use of cross-level and in-depth interviews. Top management perceptions from nine Chinese MNEs with operations in Australia are detailed.

The study obtains empirical evidence on applying the I-R framework in the context of MNEs from emerging markets. Also the hybrid factors affecting both integration and responsiveness synchronously have been confirmed by Chinese multinationals.

As a cross-sectional study, the paper focuses on senior executives’ perceptions on factors affecting the I-R framework. This analysis would be enriched by melding these perspectives with extensive secondary data on the companies concerned to assess the ratings assigned.

When studying factors affecting global integration and local responsiveness prior studies have centred on multinationals from advanced economies and/or their subsidiaries in emerging markets. This concentration leaves unclear the relevance of developed country centred findings to MNEs from emerging markets and their subsidiaries in advanced economies, and the demonstration of how emerging markets MNEs perceive factors affecting the I-R framework.

This paper explores how key insights from highly cited and well-used frameworks that describe the strategies and structures of MNCs are reflected in the international configurations of US MNCs. After reviewing existing frameworks that highlight different MNC choices regarding the integration, responsiveness, and dispersion of firm value chain activities, I perform a cluster analysis on a comprehensive and confidential database of US MNCs. The results reveal five configurations which both support the importance of key insights from existing frameworks while at the same time highlighting underexplored configuration characteristics, like the low levels of integration in US MNCs, the global sourcing arrangements for accessing foreign inputs and distribution, different approaches to regional expansion, and the limited geographic expansion of US MNCs pursuing product diversification. I argue that these underexplored characteristics suggest directions for future research to better reflect the international configuration choices of MNCs.

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

The primary goal of this study is to examine the relationships among Taiwan’s overseas subsidiaries based on their strategic roles, organizational configurations and business performance. However, their relationships also depend on the subsidiaries’ cultural differences between parent company and its subsidiary. Using regression analysis, we show that different types of industries, stages of internationalization, degrees of integration, degrees of localization, and degrees of resource dependence are the most important factors on the subsidiaries’ perceived activity satisfaction. The results indicate that the sample of Taiwanese MNC affiliates falls into three subgroups depending on their global strategies. Active Subsidiaries are highly integrated and have high local responsiveness, Autonomous Subsidiaries have high local responsiveness but low integration,while Respective Subsidiaries have low local responsiveness, but are highly integrated.

The purpose of this paper is to examine how the location of a firm’s headquarters and component sourcing impact a firm’s responsiveness in a product-harm crisis in local market.

The authors collected data on 1,251 vehicle recalls from 12 manufacturers, six in the USA, three in Germany, and three in Japan. All of the recalls occurred in the USA between 2002 and 2010. The time the product was first released into the marketplace was used as the starting point while the time the recall was initiated (if at all) was used to record the probability of the product recall over time. Specifically, a survival analysis with an accelerated failure time model was employed to examine the speed with which a product is recalled. The authors examined the impact of foreign composition using information provided by the American Automobile Labeling Act, which lists the proportion of each vehicle that is composed of domestic parts (USA/Canada) and foreign parts. Organizational characteristics (i.e. size, market share, assets, net income, and reputation) and recall size (i.e. number of affected vehicles) that might have an effect on time to recall were controlled for.

The authors found that firms headquartered outside the local market would take longer to issue a product recall than firms that were headquartered in the local market. Firm headquartered outside the local market can reduce the time taken to recall by sourcing parts from the local marketplace, rather than from abroad. Interestingly, even local firms are affected by the location of component sourcing, such that they take longer to issue a recall if they sourced parts from abroad.

Research in international marketing has examined the benefits of integration to firms, but has not studied the risks of integration. By highlighting the challenges of managing institutional differences and integration difficulties, the authors show that location of headquarters and the location from where components are sourced have an effect on firm responsiveness in product-harm crises. Further, the authors build on the global supply chain management literature that has shown the effect of upstream activities (i.e. foreign production) on downstream activities (i.e. product quality). Specifically, the authors show that upstream activities can not only affect product quality, but also the ability of firms to respond to those product qualities in a timely fashion.

Global mindset is an important theme in the international business strategy and organizational behavior literatures. However, these different paradigms define and operationalize global mindset in disparate ways, which creates problems for conducting empirical research as the disparity hampers the development of testable models. This article seeks to unify the different paradigms by introducing a third perspective from cognitive psychology that clarifies the process of mindset activation. We apply a process model of mindset activation to global mindset to build a theory of mindset switching relevant for global leaders. We operationalize global mindset as a dynamic process of mindset switching and suggest that the most appropriate mindset for a situation can be primed to activate. We also propose cosmopolitanism and cognitive complexity as antecedents to appropriate mindset activation and mindset switching. Finally, we suggest that mindset/situation congruence results in global leader creativity and boundary spanning. By applying the cognitive psychology literature to global mindset research, we clarify the process of global mindset and why it is important for leaders to understand how different primes might activate the most appropriate mindset. Our model provides a means for managers to become more cognitively aware of how they problem solve in a highly complex and multilayered world. This paper proposes a unique, dynamic model that captures dualities of global leadership. The model provides a new perspective of global mindset that is testable with existing measures and procedures.

This paper revisits Bartlett and Ghoshal’s transnational theory of the MNC in relation to multi-domestic MNCs. We argue that the aggregate level of analysis adopted by Bartlett and Ghoshal is unhelpful for identifying significant changes in multi-domestic MNCs at the level of discrete functions. We argue that a more disaggregated level of analysis is required. Our analysis of two cases of multi-domestic MNCs that have undertaken the global integration of their locally distributed purchasing functions indicates that while significant change to the purchasing function has occurred, at the aggregate level both MNCs remain multi-domestic. In both cases the decision to integrate local purchasing was regarded as having more obvious benefits than integrating other functions such as marketing. While both of our case multi-domestic MNCs may in future choose to integrate other functions and develop into full-fledged transnational companies we argue that there is no inevitability to this. Indeed global integration may cease with the purchasing function. A second theme in this paper is that we argue that Bartlett and Ghoshal’s transnational theory has a biased view of what constitutes effective governance mechanisms for achieving global integration, local responsiveness and worldwide learning and that it would greatly benefit from a more balanced application of hierarchical and relational governance mechanisms.

The purpose of this paper is to explore the fit between process standardization and international management strategy of multinational corporations (MNCs) by assessing the compatibility between process standardization and corporate structural characteristics in terms of asset configuration and headquarters-subsidiary relationships.

First, after a literature review on MNCs’ strategy and process standardization, the study suggests two propositions on the fit between corporate international management strategy and process standardization. Second, to empirically examine the propositions, the study investigates the outcome of process standardization in three cases with different strategic and structural contexts. Third, using the propositions and empirical findings, the study proposes a framework for aligning process standardization with MNCs’ structural characteristics.

Process standardization has a higher degree of fit in MNCs pursuing global integration where process standardization parallels the need for coordinating interdependencies in the functional structure, and is consistent with the headquarters’ operational control over the subsidiaries. Process standardization has a lower degree of fit in MNCs seeking local responsiveness as process standardization disturbs the financial control relationship between the headquarters and subsidiaries and is less crucial for coordination as the subsidiaries contain the necessary coordination mechanisms.

The study provides in-depth understanding of how the international management strategy and consequent structural characteristics of MNCs affects process standardization in the course of a global enterprise resource planning implementation. The study proposes conditions of fit for aligning process standardization with asset configuration and headquarters-subsidiary relationships of an MNC.

Purpose – The purpose of this chapter is to analyse the evolution in the local, global and multinational network embeddedness of foreign subsidiaries in China

Methodology – The study focuses on Sino-Belgian subsidiaries in China. Factor analysis was used to determine the local responsiveness, global integration and multinational network embeddedness of firms. Next cluster analysis was carried out to classify groups of subsidiaries, while ANOVA analysis assessed their different characteristics.

Findings – Although most firms remain the same type of subsidiary throughout the period of 1995–2005, the most prevalent trajectory of strategic evolution by multinational subsidiaries in China is by increasing the integration in the multinational network before gaining more local embeddedness towards a more active role within the multinational network.

Research implications – Changes in the strategic setting and operations of MNEs occur over time because of the dynamic patterns and changing interactions of firm- and country-related factors and policies, especially when the host economy is involved in a rapid transformation process, such as China. Further research could focus on the determinants of strategic evolution.

Originality – This is one of the first chapters to analyse the changing roles of subsidiaries, in particular in an emerging economy.