Organizational slack as an enabler of internationalization: The case of large Brazilian firms

In this paper, we address an empirical puzzle. We note that a deliberate and serious drive to internationalize has occurred rather late in the evolution of large Brazilian firms. Meanwhile, and despite their late internationalization, these Brazilian firms expanded rapidly and intently. Despite the rich literature on Emerging Market Multinational Enterprises (EMNEs), there is still much contention on what drives rapid EMNE internationalization, particularly for the less explored firms from Latin America. Using an inductive case study of five leading Brazilian MNEs, we bring new insights on this neglected question. We unveil that the existence of organizational slack (of operational, managerial, and financial nature) can indeed facilitate rapid internationalization, particularly when triggered by unique home country conditions (e.g., regulation; rising cost of doing business at home; exhaustion of profitable growth opportunities in the domestic market).     

Gaining legitimacy through hiring local workforce at a premium: The case of MNEs in the United Arab Emirates

This study examines the process and outcomes of cultivating external legitimacy through the employment of host country nationals by multinational enterprises’ (MNEs) affiliates in the United Arab Emirates. It builds on the literatures of both institutional theory and legitimacy. Analysis of data obtained from 48 managers of MNE's affiliates located in the UAE shows that in sectors where the employment of host country nationals is almost taken for granted such as in banking, MNEs are driven by a sense of appropriateness and social legitimacy. In contrast, in sectors where the employment level of UAE nationals is almost nonexistent, those MNEs engaging in localization are driven by the logic of economic efficiency and tend to employ nationals in order to extract rent from the government. The authors discuss the results and their managerial and policy implications.     

Diversity & internationalization: The case of boards and TMT's

Using a mixed US and European sample where both the board and TMT units are analyzed at the same time, we test the variables age, tenure and functional background.We extend the information/decision making perspective (Williams & O’Reilly, 1998) to both TMTs and boards by analyzing them as separate but related entities. In line with our hypotheses we find a positive effect on internationalization for functional background diversity of both boards and TMTs.Contrary to our expectations longer TMT tenure and younger board age also have a positive effect on internationalization.     

Ethical banking: The case of the Co-operative bank

The aim of this paper is to present a significant current British case of the application of an ethical approach to banking practice — it relates to issues of stakeholder dialogue, corporate strategy, and marketing.The Co-operative bank traces its organisational origins to the 1870s, and its founding principle to the beginnings of the co-operative movement in the 1830s.In today's fiercely competitive and rapidly changing financial services market, dominated by four major players, the bank has only a 2% share and its advertising spend and marketing profile have been low.Against this background, the bank searched for a positioning statement which would counter its low profile; express where it wanted to be; and give direction to its necessarily limited marketing and communications budget.What slowly evolved was an ethical banking strategy which built on the bank's differences from the others, and which benefited from an opportunity which was being ignored by them. The key concept was a commitment to the responsible sourcing and distribution of funds. A quantitative research project was undertaken with 30 000 customers which revealed major support for the overall strategy, and which was used to prioritise the practical issues of greatest concern. The outcome was an ethical banking policy which communicated what we are and what we stand for and strict guidelines on who we will, or will not do business with.Professor Brian Harvey is The Co-operative Bank Professor of Corporate Responsibility at Manchester Business School, University of Manchester and Honorary Secretary of the European Business Ethics Network. His books have been published by Prentice Hall, Macmillan & Kluwer, of whose series Issues in Business Ethics he is joint Editor.     

Microenterprises and multiple bank relationships: The case of professionals

The present paper focuses on professionals as a special group of microenterprises. It explains their characteristics and financial relationships, using data from a survey conducted in Germany in 2002. Consistent with the theory of asymmetric information and relationship lending, we find that these firms maintain a small number of bank relationships, which increases in firm size and age. They tend to choose multiple banking relationships to overcome credit rationing and finance larger loans. Credit risk and the structure of the banking market do not seem to matter.     

Islamic financing and bank risks: The case of Malaysia

We examine whether Islamic financing can explain three important bank risks in a country with a dual banking system: credit risk, interest‐rate risk, and liquidity risk. Using Malaysian data, we find that commercial banks with Islamic financing have significantly lower credit and liquidity risks but significantly higher interest‐rate risk than banks without Islamic financing. There is also evidence that bank size is significantly related to credit risk; the proportion of loan sales to total liabilities and bank size are significant determinants of interest‐rate risk; and off‐balance‐sheet financing, the extent of securitization, loan volatility, bank capital, and bank size are statistically significantly related to liquidity risk. © 2005 Wiley Periodicals, Inc.     

Intellectual capital reporting practices in an Islamic bank: A case study

Given the nature and importance of Islamic banks in recent times, we can expect them to have significant intellectual capital anchored in their Sharia‐based knowledge and expertise. However, we know very little or nothing about how and why intellectual capital‐related information is provided in their corporate reports. We fill this gap in our existing knowledge of the field with a view to enhance relevant literature. As far as we know, this article is one of the earliest exploratory attempts to examine intellectual capital reporting practices of an Islamic bank. We have undertaken a longitudinal (2001–2015) case study related to the intellectual capital reporting practices of an Islamic bank. Key results include significant rise of intellectual capital reporting over time, dominance of internal capital‐related items in intellectual capital reporting profile and the dynamics of changes in intellectual capital reporting practices over time. Through an institutional theory lens, we explain that this is due to the changes in the external institutional environment and various intra‐organisational factors such as strong ethical culture, unique knowledge base (Sharia), and corporate governance regime.     

Serial nonlinear internationalization in practice: A case study

International business scholars still pay the most attention to two firm types: (1) gradual/step-by-step/Uppsala type internationalizers and (2) international new ventures/born globals. Serial nonlinear internationalizers (SNIs) – firms with several subsequent exits and re-entries or considerable foreign involvement fluctuations – have received almost no attention. This exploratory study aims to contribute to the emerging serial nonlinear internationalization literature by (1) discussing the nature of an Italian machinery producer's serial nonlinear internationalization, (2) explaining why it internationalized nonlinearly and (3) developing research implications. It concludes that despite having had a year or more without export activities in 29 countries (in eight of them twice or more) and activities only in seven countries in 2011, this firm has been relatively successful. Thus, de-internationalization is not automatically a sign of failure. Moreover, subsequent de- and re-internationalizations are normal for other firms besides project businesses, especially if their markets are small and exit/re-entry costs low.     

Representation as a driver of internationalization: The case of a singular Russian SME

This exploratory research focuses on an unconventional practice in a Russian small- and medium-sized enterprise (SME). While studying the decision-making process of the entrepreneur and executives of this firm, we noted some differences with extant theories. This article aims to shed light on the influence of the SME entrepreneur’s representation of internationalization on his decisions in a foreign context. The results support the assumption that the representation plays a role in guiding strategic decisions and mobilizing subordinates to support the strategic orientation defined by the leader. In particular, we will see that a very favorable representation of internationalization can lead to unexpected success abroad.     

Motives,choice of entry mode,and challenges of bank internationalization: Evidence from China

This study examines the motives, entry mode choice, and challenges of the international expansion in an emerging country context. Data were collected via interviews from 30 senior managers based on a sample of 10 Chinese commercial banks (CCBs) involved in international expansion over the period of 2001–2013. This study finds greenfield and mergers and acquisitions are the most popular foreign entry mode used by CCBs. The motives of emerging market banks’ internationalization appear to be intrinsically linked to market development to serve customers operating in overseas market, government policies, and strategic knowledge sourcing. In terms of challenges, the study finds lack of management resources/technical capacity, culture, adapting to the host country regulatory environment, and lack of experience to be the main challenges to bank internationalization.     

Transaction services and SME internationalization: The effect of home and host country bank relationships on international investment and growth

Building on the argument put forward by North and Wallis (1994) that the transaction sector enables economic growth by lowering the costs of transacting, we investigate how internationalizing firms’ host and home country bank relationships affect their international specific investments and growth. Banks provide payment, liquidity, and risk management services, which are essential to international business relationships, yet little is known about how banks affect international business relationships. In a sample of 255 small and medium-sized enterprises (SMEs), we find that host and home country bank relationships affect the dependent variables differently. We contribute to the literature by explicating the role and effects of banks in international business relationships. Our findings have implications for understanding transaction services in international business as well as the choices made by their customers.     

Selecting the country in which to start internationalization: The non-sequential internationalization model

The paper analyses the selection of the country in which a firm starts internationalization. It proposes that some firms strategically choose a non-sequential internationalization, that is, they select a country that is dissimilar to their country of origin for their first foreign expansion. The reason for this is that some firms develop, in their home country, three types of knowledge that are useful to overcome foreign expansion difficulties: knowledge to manage complexity, developed by having multiple operations at home; knowledge to manage differences in competitive conditions, developed by operating in business-to-business industries, and knowledge to manage differences in institutional environments, developed by allying to a foreign firm at home.     

International briefing 9: Training and development in the United Arab Emirates

This article explores the training and development strategies and practices of large business organisations in the United Arab Emirates (UAE). The survey reveals that Emirati companies are very aware of best training and development practice as implemented in their foreign counterparts, and that they generally adopt similar methods and strategies. The article considers the influence of national culture, religion, government policies, education and the economic environment upon the training and development strategies and practices of companies in the UAE. It is argued that despite the negative effects of a dwindling oil sector, the UAE's companies are well placed to maintain their current regional success and that they will soon be playing an increasingly important role in international trade, thus significantly contributing to the continuing economic growth of the country.     

进入中东的桥梁--阿联酋

阿拉伯联合酋长国总人口237.74万人,位于阿拉伯半岛东部的波斯湾南岸.西北面与卡塔尔为邻,西南面与沙特阿拉伯为邻,东和东北与阿曼交界,海岸线长643公里.在阿联酋,阿拉伯人仅占1/3,其了为外籍人,来自35个国家.阿拉伯语为官方语言,通用英语,沿海地区使用波斯语.     

The internationalization of small firms: The relationship between the global mindset and firms’ internationalization behavior

Some firms in internationally oriented industries are internationalized while other comparable firms in the same sector or industry do not. Observing this difference in strategic behavior among small firms led us to consider how differences in CEOs’ attitudes, international orientation, and mindset might explain it. Therefore, this study adopts a cognitive perspective on management to explore the formation of the global mindset and the relationship between the global mindset of small-firm decision makers and their firms’ internationalization behavior. A theory-based conceptual model and measurement instrument are developed and—using structural equation modeling—the model is estimated based on empirical data from cross-sectional samples of small Norwegian and Portuguese firms. The study finds: (1) a strong causal relationship between the global mindset and firms’ internationalization behavior; (2) the combination of the findings and substantive theory indicates that the main driver of firms’ internationalization operates through the global mindset. This study also covers the factors that strongly influence the formation of a global mindset, especially the decision makers’ work experience and personal characteristics in terms of propensity to interdisciplinary collaboration, cognitive flexibility, and networking capability. Based on these findings, suggestions are made for policies that can foster the internationalization of small firms.     

Firm internationalization,business group diversification and firm performance: The case of Latin American firms

We examine the influence of multinationality and business group diversification on firm performance. Further, we examine how their interaction varies between service and manufacturing firms. We assess these relations in three Latin American countries using a sample of 103 firms over the period from 2000 to 2007. We found that there is a limit to the positive effects of business group diversification and that business group diversification effectively moderates the multinationality-performance (M-P) relationship. Our results also suggest that diversified business groups have a stronger positive influence on the M-P relationship for service firms compared to manufacturing firms.     

Accelerated internationalization by emerging markets’ multinationals: The case of the white goods sector

The emergence of a “second wave” of developing country multinational enterprises (MNEs) in a variety of industries is one of the characterizing features of globalization. This paper documents how emerging markets’ MNEs (EM-MNEs) may follow quite different patterns to reach, or at least approach, global competitiveness. In particular, it investigates how three EM-MNEs pursued global growth through accelerated internationalization combined with strategic and organizational innovation. Haier (China), Mabe (Mexico) and Arçelik (Turkey) emerged as multinationals in the large home appliances (so-called “white goods”) industry. The recipe for the success of these firms seems to lie in their ability to treat global competition as an opportunity to build capabilities, move into more profitable industry segments, and adopt strategies that turn latecomer status into a source of competitive advantage. At the same time, their experiences show that there are many strategies and trajectories for going global, consistent with a pluralistic conceptualization of globalization.     

The legal framework and initiatives for promoting safety in the United Arab Emirates

Injury is a leading cause of morbidity and mortality in the United Arab Emirates (UAE). The UAE is a rapidly developing country with fast economic growth, demographical and environmental changes that are associated with new hazards emerging at a similar pace. The UAE as a federal entity has federal and local systems responsible for safety policy, regulations and enforcement. To set priorities for safety promotion and injury prevention, it is necessary to have data on the most frequent external causes of injury and the main individual, equipment and environmental risk factors that contribute to injury. However good quality data for injury prevention are scarce. The aim of this paper is to describe the scale of injury as a public health problem in the UAE, and the development of safety policies, regulations and promotion efforts with special emphasis on traffic, occupational and child safety.