Expatriation and its effect on headquarters' attention in the multinational enterprise

We explore the circumstances under which expatriates can help their host‐subsidiary capture headquarters' attention. Our central contention is that expatriates will be particularly helpful in situations where a subsidiary or its market is showing signs of growth, allowing headquarters to recognize information signaling opportunities for the firm that could otherwise go unnoticed. We test this contention using a robust instrumental variable approach in a single multinational enterprise. Our results show that subsidiaries hosting expatriates and experiencing growth at the subsidiary or market level have a higher probability of capturing headquarters' attention. Copyright © 2013 John Wiley & Sons, Ltd.     

Geographic scope and multinational enterprise performance

Through an internalization theory lens, an argument is developed to suggest that the traditional concept of geographic scope should be split into two related, but more precise, elements of international asset dispersion and country environment diversity. Subsequently, these new concepts are tested using a structural equation modeling approach on a sample of 580 large multinational enterprises (MNEs). We find that the relationship between economic performance and international asset dispersion is positive, but that country environment diversity is negatively associated with performance, with a positive interaction between them. This study adds to our theoretical understanding of MNEs, and also provides a bridge between the mixed findings of prior research on multinationality by disentangling the unique effects of the latent subcomponents of geographic scope on firm performance. Copyright © 2003 John Wiley & Sons, Ltd.     

Life duration of foreign multinational subsidiaries: Evidence from UK northern manufacturing industry 1970–93

Duration analysis is employed to examine the survival of 252 foreign manufacturing plants in the UK Northern region during 1970–93. Contrary to expectations, the hazard function is approximately inverse quadratic rather than monotonic decreasing. Greenfield entrants face a lower risk of failure than acquisition entrants, particularly early in life. Acquisitions of older plants exhibit stronger survival than acquisitions of recently established plants, so that the age of (indigenous) acquired plant at the point of foreign takeover appears to matter to the survival of acquisition entrants. Plant size and industrial concentration also emerge as important. Home country of parent firm and location within region are unimportant. Consistent with the inverse U-shaped hazard function, the lognormal regression model provides a reasonably satisfactory fit to the data, certainly tighter than the Weibull model.     

Orchestrating corporate social responsibility in the multinational enterprise

Research Summary: Multinational enterprises (MNEs) invest significant resources in corporate social responsibility (CSR), but their attempts to build a global “social brand” may clash with the execution of operational strategies at a subsidiary level. Using a game-theoretic model, this research addresses the complex interplay of different contingencies that shape the coordination and control challenges facing MNEs when they implement global CSR strategies, including brand spillovers, the risk of public scandals caused by irresponsible behavior, the size of the MNE network, as well as the roles played by nongovernmental organizations and altruistic managers. Challenging the view of CSR as insurance against lapses of responsible conduct, our model shows that investment in social brands helps avoid irresponsible practices across the MNE network, thereby inducing subsidiaries to “walk the talk.” Managerial Summary: Global social brands are increasingly valuable to multinational enterprises (MNEs), which makes the control and coordination of responsible behavior across their network of foreign subsidiaries a relevant managerial challenge. Indeed, lapses of responsible conduct at the subsidiary level often generate reputational damage at the multinational level. This research explores several mechanisms that help MNEs manage this coordination and control challenge. First, it shows under what conditions MNEs can leverage their investments in social brands to induce responsible practices across their global network. Second, it illustrates how MNEs can exploit collaborations with nongovernmental organizations to reduce the costs of coordinating and controlling their subsidiaries. Finally, it identifies conditions under which MNEs benefit from hiring altruistic managers to run their subsidiaries.     

论中国跨国石油企业文化

中国跨国石油企业文化是基于中国石油企业跨国经营的实际,以中国石油企业特有精神文化为基础,融合各国文化特色的跨国企业文化的特有体现.中国石油企业直接参与国际竞争是中国跨国石油企业文化形成的外在条件.在十多年的跨国经营中,中国的石油企业已经形成了一批直面国内外市场竞争的企业家和职业经理人团队,这是中国跨国石油企业文化最值得珍惜的宝贵财富.面对国际石油市场激烈的竞争,通过有效整合跨国石油企业组织要素来降低交易成本是提高跨国石油企业竞争力的关键.跨国石油企业的价值观是指导跨国石油企业决策和行为的理念基础,是跨国石油企业管理和发展的灵魂.中国石油企业在跨国经营时面对多元的文化环境,"爱国主义精神","铁人精神"、"奉献精神"是中国跨国石油企业文化的核心内涵.     

Globalization, new ecologies, new zoologies, and the purported death of the eclectic paradigm

This paper provides a commentary to John Mathews' article in issue 23(1) of the Asia Pacific Journal of Management. I discuss how globalisation is fundamentally altering the milieu within which international business is conducted, and this new ‘ecology’ may indeed require scholars to consider a new ‘zoology’ of firms in the future. However, his specific suggestions are based on sparse evidence, and his alternative to the eclectic paradigm is founded on a misunderstanding of some fundamental concepts.     

How advanced is the strategy paradigm? The role of particularism and universalism in shaping research outcomes

As the field of strategy reaches its 25th anniversary, we examine how far the field has progressed during that time. Both management and strategy research have been characterized as being in an early stage of development. We draw on Kuhn's ( 1996 ) paradigm development model, which posits a connection between a field's stage of maturity and research processes and outcomes, to assess the maturity of the strategy field. We conduct two studies. The first is a cross‐discipline comparison of productivity norms for university faculty. The second study examines longitudinal research outcomes for a sample of 945 strategy faculty. Our results indicate that strategy has the attributes of both an early stage and mature field: while overall research norms are low relative to other fields, they are driven far more by merit‐based than non‐merit factors. Copyright © 2005 John Wiley & Sons, Ltd.     

The effect of alliance network diversity on multinational enterprise performance

This paper examines the impact of alliance network diversity on multinational enterprise (MNE) economic performance. We consider competing hypotheses derived, alternatively, from transaction cost theory and network theory. Using a latent variable structural equation modeling approach on a sample of 580 large MNEs, we find that MNEs with more diverse alliance networks experience lower economic performance on average than those with less diverse alliance networks. Copyright © 2005 John Wiley & Sons, Ltd.     

Institutions and business networks: A comparative analysis of the Chinese, Russian, and West European markets

The paper analyses business networks originating from three markets: Chinese, Russian, and West European. So far, little attention has been given to the fact that business networks in particular markets may be dissimilar because of differences among institutions. The paper advances a model where institutions are assumed to influence five major characteristics of business; (1) the processual aspects of the network, (2) the structural aspects of the network, (3) the function of firms and relationships in the network, (4) the meaning of strategy and planning, and (5) social relationships in the context of inter-firm relationships. The analysis builds on three types of substances of institutions — cognitive, normative, and regulative, which in turn are specified according to different aspects. The cognitive substance of business networks is explored through the aspects of self, time, and causality. The normative substance is explored through the aspects of achieved versus ascribed status, inner versus outer direction, universalism versus particularism, and trust. The regulative substance is specified as an authority system and a sanction system. The analysis demonstrates that, as institutions differ in these three markets, the business among them also differs in terms of the five characteristics, and this variation calls for different strategies for firms operating in these markets.     

Varieties of Asian capitalism: Toward an institutional theory of Asian enterprise

In this paper we respond to calls for an institution-based perspective on strategy. With its emphasis upon mimetic, coercive, and normative isomorphism, institutional theory has earned a deterministic reputation and seems an unlikely foundation on which to construct a theory of strategy. However, a second movement in institutional theory is emerging that gives greater emphasis to creativity and agency. We develop this approach by highlighting co-evolutionary processes that are shaping the varieties of capitalism (VoC) in Asia. To do so, we examine the extent to which the VoC model can be fruitfully applied in the Asian context. In the spirit of the second movement of institutional theory, we describe three processes in which firm strategy collectively and intentionally feeds back to shape institutions: (1) filling institutional voids, (2) retarding institutional innovation, and (3) deploying institutional escape. We outline the key contributions contained in the articles of this Special Issue and discuss a research agenda generated by the VoC perspective.

Managers’ view of a new inventory paradigm

The significance of inventories in business operations have never been denied. The actual role of inventories, however, is changing over time, as required by the business environment. This paper provides empirical background to the thesis, which says that the role of inventories in the “Golden Era” of inventory research, which was in the 1950s, was significantly different from that of today because of fundamental changes in business. This development requires new approaches in research as well.After a summary of the antecedents, the results of a survey are analysed, and they support the above thesis. The lack of difference between the inventory performance measured by the turnover rate of those companies, whose managers accept and those who deny the birth of the new paradigm calls attention to the need for the elaboration of a more complex inventory performance measurement.     

Assessing the greenness of environmental advertising claims made by multinational industrial firms

Growing skepticism about green advertisements calls for a thorough investigation of the environmental claims made by firms. This is particularly important in the context of industrial and international markets, where research on the subject is virtually non-existent. By employing legitimacy theory, this article develops several research hypotheses linking various dimensions of environmental claims made in green advertisements (i.e., focal points, evaluation areas, leverage aspects, driving forces) with advertising greenness (i.e., shallow, moderate, deep). It then tests these hypotheses with data obtained from a content analysis of 383 green magazine advertisements by multinational firms producing industrial goods. In accord with legitimacy theory, the results indicate that, the stronger the greenness of an advertisement: (a) the greater the use of focal points relating to a product, processes, image, and facts; (b) the more specific, strong, substantive, and acceptable are the issues raised; (c) the higher the employment of rational, emotional, and moral points to leverage environmental matters; and (d) the sharper the driving forces relating to the planet and its flora, fauna, and human entities. Several important conclusions, managerial implications, and directions for future research are derived from these findings.     

Innovation and control in the multinational firm: A comparison of political and contingency approaches

This study focuses on control mechanisms used by multinational corporations (MNCs) to manage their extra‐national R&D units. Drawing on both the literature on organizational power and contingency theory, this study develops and empirically tests a set of hypotheses aimed at explaining how headquarters control their overseas R&D units. Data collected from 134 R&D units of German MNCs serve to test the hypotheses. Results highlight the importance of the units' R&D mandate and its interdependence in explaining control mechanisms. Moreover, they indicate a relatively weak predictive power of political approaches compared to contingency approaches. Copyright © 2007 John Wiley & Sons, Ltd.     

Competition and regulation in China's 3G/4G mobile communications industry—Institutions,governance, and telecom SOEs

When it comes to the analysis of the intrinsic mechanism of market behaviors and hence competition development and regulatory imperatives in the Chinese telecommunications industry, currently there is no consistent pattern offered in the literature. In China's emergent 3G/4G era, market behaviors can be affected by various institutional factors, along with various forms of informal forces, which may translate into different implications for competition regulation. Based on extensive archival research and interview, this current study aims to bridge the gap by following an interpretive approach. An input–output model was substantiated for pattern-matching in the Chinese context base on the postulation of a series of propositions and hence Industry-Gray-Box. Accordingly, two categories of market behaviors, that is, market-driven vs. institutions-driven, were arguably delineated as being underpinning the competition development. Policy implications and future reform imperatives were discussed. This study may advance knowledge in terms of: (1) the establishment of a relatively consistent pattern for mapping the landscape of China's communications industry; (2) the substantiation of the inner working mechanism of China's SOE system in the telecommunications sector; and (3) original first attempt in identifying different roles of telecom SOEs and the governing forces that affect them. The paper also offers extensive and cohesive insights on China's formal and informal institutional environment in general and for telecommunications in particular. Measurements developed in this study may serve as basis for future study.     

Institutions,resources, and entry strategies in emerging economies

We investigate the impact of market‐supporting institutions on business strategies by analyzing the entry strategies of foreign investors entering emerging economies. We apply and advance the institution‐based view of strategy by integrating it with resource‐based considerations. In particular, we show how resource‐seeking strategies are pursued using different entry modes in different institutional contexts. Alternative modes of entry—greenfield, acquisition, and joint venture (JV)—allow firms to overcome different kinds of market inefficiencies related to both characteristics of the resources and to the institutional context. In a weaker institutional framework, JVs are used to access many resources, but in a stronger institutional framework, JVs become less important while acquisitions can play a more important role in accessing resources that are intangible and organizationally embedded. Combining survey and archival data from four emerging economies, India, Vietnam, South Africa, and Egypt, we provide empirical support for our hypotheses. Copyright © 2008 John Wiley & Sons, Ltd.     

Financial performance and survival of multinational corporations in China

This study investigates the impact of entry timing, mode of entry, market focus, and location advantages on the financial performance and survival of multinational corporations (MNCs) in China. Three major results were found. First, MNCs that entered China in an earlier year had a higher level of profit than those that entered in a later year. Second, equity joint ventures (EJVs) had a higher profit level than cooperative operations or wholly foreign‐owned subsidiaries. Third, MNCs that utilized well the location advantages in China had a higher profit. We also found that EJVs were more likely to survive compared to cooperative operations, while wholly owned subsidiaries did not differ from EJVs. The findings are based on a 2‐year study of about 1000 MNC operations in China. Copyright © 1999 John Wiley & Sons, Ltd.     

Pharmaceutical marketing through the customer portfolio: Institutional influence and adaptation

This paper discusses the dilemma of managing marketing in institutionalized business contexts. On the basis of a study of pharmaceutical marketing practices it is argued that business aspirations are dependent on understanding institutional influence and adaptation mechanisms on the customer-portfolio level. As relationships are perceived as such mechanisms, understanding network dynamics, institutional co-evolution and actor cognitions are key managerial issues. Furthermore, it is suggested that institutional discontinuities leverage institutional entrepreneurship to a critical extent.     

跨越泛虚 崇实鼎新——任楼煤矿企业文化变革的实践

近年来,企业文化作为一种管理理念备受关注。然而,大多数企业在企业文化建设中存在着不同程度的“泛虚”现象,使企业文化流于口号和宣言,或转变为繁琐的文字型文化,甚至把文化娱乐化。这些“虚空”的企业文化不能为广大员工所接受,对于提升企业竞争力也只是隔靴搔痒,收效不大。     

The performance implications of intra‐ and inter‐regional geographic diversification

Engaging the debate regarding the appropriate level of geographic diversification for multinational enterprises (MNEs), we examine a critical, yet unresolved, question: How is performance impacted by the MNE's level of intra‐ and inter‐regional diversification versus the total level of geographic diversification? Using data from 123 U.S.‐based MNEs over a seven‐year period and leveraging both sales‐based and subsidiary‐based measures for diversification, we find that performance increases at an increasingly higher rate as firms concentrate more heavily on intra‐regional diversification. Regarding inter‐regional diversification and total geographic diversification, we find inverted‐U relationships to exist between firm performance and the level of geographic diversification. Different from recent research on multinationality, our robustness checks indicate no evidence of a sigmoidal relationship between the degree of regional diversification and performance. Copyright © 2010 John Wiley & Sons, Ltd.     

Choice of ownership mode in joint ventures: An event history analysis from the automotive industry

Inter-firm partnerships continue to be a major trend in the B2B context. Firms seek collaborative ventures to enter foreign markets, combine resources, share costs and risks, and build synergies in an increasingly competitive environment. Accordingly, the impacts of firm and host country characteristics on the selection of entry mode have been extensively studied in the literature. Nevertheless, most of these studies regard all entry modes as feasible alternatives for firms, which is rarely the case in practice. Instead, the number of entry modes available to a firm is more likely to be limited by the firm's assets and the context of the host country. As such, these contingencies, coupled with the idiosyncrasies of each entry mode, necessitate more focalized inquiry in the entry mode literature. Drawing from the OLI framework, this study zeroes in on international joint ventures (IJVs) and analyses the impact of ownership and location advantages on firm's decision about the level of control (i.e., internalization level) in an IJV in a given country. Results indicate a positive relationship between the ownership advantages and the level of control. It is also found that firms tend to favor higher control mode where the host country provides better locational advantages.