Partnership or self-reliance entry modes: Large and small technology-based enterprises’ strategies in overseas markets

This study compares large firms against small and medium-sized firms in technology industries and assesses the differences between them in the choices between partnership and self-reliance entry modes. A sample of 166 large, small, and medium-sized firms in technology industries was analyzed using LISREL 8.30. Results indicate that, given innovative advantage, large and small and medium-sized firms both prefer self-reliance entry modes. With violent market dynamism, large firms prefer self-reliance entry modes while small and medium-sized firms prefer partnership entry modes. When high promotional effort is required, small and medium-sized firms prefer partnership entry modes and large firms may prefer partnership entry modes as well. This study provides important guidance for managers of large and small technology-based firms to select their entry modes when they enter overseas markets.     

The success of stock selection strategies in emerging markets: Is it risk or behavioral bias?

We examine competing explanations, based on risk and behavioral models, for the profitability of stock selection strategies in emerging markets. We document that both emerging market risk and global risk factors cannot account for the significant excess returns of selection strategies based on value, momentum and earnings revisions indicators. The findings for value and momentum strategies are consistent with the evidence from developed markets supporting behavioral explanations. In addition, for value stocks, the most important behavioral bias appears to be related to underestimation of long-term growth prospects, as indicated by above average earnings revisions for longer post-formation horizons and by quite rapidly improving earnings growth expectations. Furthermore, we find that overreaction effects play a limited role for the earnings revisions strategy, as there is no clear return reversal until five years after portfolio formation, setting this strategy apart from momentum strategies.     

Small firms’ non-market strategies in response to dysfunctional institutional settings of emerging markets

Institutional settings in emerging markets are often plagued by state actors exploiting the vulnerability of resource-constrained small and medium sized enterprises (SMEs). Whilst we know a great deal about how large firms use non-market strategies (NMS) to navigate such institutional spaces, current knowledge of such strategies in connection with SMEs remains limited. Using in-depth interview data from a wide range of actors in Russia, we reveal the predatory behavior of state actors and how, in response, SMEs develop NMS to respond to fluctuating institutional conditions. We underline four forms of institutional predatory behaviors comprising shifting the rules of the game; privatizing power; selectively using/abusing laws; and normalizing informalities. In turn, we identify how SMEs variously adopt NMS to tackle these predatory strategies; namely deflection, alliance, concealment and internationalization. We highlight how SMEs learn to navigate, and ultimately to overcome, dysfunctional and fragile institutional conditions of emerging markets through the pursuit of particular NMS.     

Country and industry factors in returns: evidence from emerging markets’ stocks

This study examines the influence of country and industry factors on the cross-sectional variance and correlation structure of returns. I use new data on emerging markets’ stocks obtained from the Emerging Markets Data Base. I find that emerging markets’ returns are mainly driven by country factors, as it was shown previously in studies for mature markets, and that cross-market correlation is not affected by the industrial composition of the indices. These results have important implications in regard to international portfolio diversification: cross-market diversification seems to be a better bet than cross-industry diversification. A finer industry partition shows, however, that ignoring the industrial mix leads to an important loss of diversification benefits.     

Ownership structure and earnings management in emerging markets—An institutionalized agency perspective

Previous earnings management research has largely focused on firm-level governance mechanisms in single countries or on macro-level variables in multiple countries. Building on this research, we incorporate firm ownership predictors along with national institutional dimensions to explore why firm decision makers in emerging markets vary in their earnings management behavior. Our theoretical framework integrates agency and institutional theories proposing that firm-level ownership mechanisms do not function in isolation, but are reinforced or attenuated by elements of the institutional governance environment. The multilevel empirical analysis of 1200 firms in 24 emerging markets indicates that controlling ownership is positively related to earnings management. We find that the level of minority shareholder protection in a country weakens this positive relationship. We also find that regulatory quality strengthens the negative relationship between institutional ownership and earnings management activity. It is hoped that awareness of how firm ownership structures interact with national-level institutions in affecting firm-level behavior will help managers and investors develop skills and practices to better cope with business norms in emerging economies.     

Foreign direct investment in emerging markets and acquirers’ value gains

We investigate the shareholder wealth effects of 306 foreign direct investment (FDI) announcements by UK firms in seventy-five emerging markets (EM). Our results show that acquirers enjoy highly significant gains during the announcement period of FDI. Perhaps surprisingly, the highest gains are accrued to acquirers investing in countries with high political risk and high corruption ratings. The type of asset acquired has also a significant effect on the gains of acquirers’ shareholders, with the highest gains accrued to acquirers of physical assets. Also, investments in physical assets in EM with a high corruption rating elicit the highest gains. We contend that UK firms following resource-seeking strategies in EM with a high corruption rating are facilitated access to resources on favorable terms and this is viewed positively by the market participants. Our results are robust to alternative model specifications and the endogenous choice to expand internationally.     

Do as the large enterprises do?: Expatriate selection and overseas performance in emerging markets: The case of Taiwan SMEs

This study investigated the less explored expatriation practices of small- and medium-sized enterprises (SMEs) in emerging markets. Data for 133 Taiwan SMEs operating in Malaysia and Vietnam revealed that four personality traits of expatriates, i.e., control ability, independence, openness and social ability exert significant influences on overseas performance given that different types of performance require different of expatriate competency. Analytical results also indicated that the widely perceived influence of the favorable evaluation of the expatriate by top managers does not impact the overseas performance of expatriates. Further, the expatriate practices of Taiwan SMEs vary depending on cultural differences between the home country and host countries. Taken together, the findings of this study have valuable implications for both academicians and practitioners in international management.     

East meets west—Corporate governance in Asian emerging markets: A literature review and research agenda

This review examines how corporate governance mechanisms in the Asian emerging markets (AEMs) context affect firm-level outcomes. Literature about characteristics of the main corporate governance actors (boards and owners), their effects on firm-level outcomes, and contingency factors in AEMs offers interesting first insights. I synthetize these results and develop a research agenda that proposes how AEM corporate governance research should extend (but not ignore) agency theory, how AEM research about firm effects of corporate governance could take a stakeholder-oriented perspective, and how research could utilize the AEM institutional context to model contingency factors and extend our theoretical understanding of corporate governance.     

Launching reverse-innovated product from emerging markets to MNC’s home market: A theoretical framework for MNC’s decisions

A reverse-innovated product is a new product that is originally developed for an emerging market by MNCs. The increasing number of MNCs engaging in reverse innovation and the criticality of new products to an MNC’s performance and competitive advantage make reverse innovation an important area for academic research and managerial practices. This paper integrates relevant literature and proposes a theoretical framework to understand the mechanisms by which the characteristics of a reverse-innovated product affect management’s decision to launch that product in a developed market (e.g., the MNC’s home market). By means of literature review, the paper identifies two underlying evaluation mechanisms through which the reverse-innovated product characteristics are linked to management’s reverse launch decision: the perceived degree of needed adaptation and the perceived risk of cannibalization. The authors also derive several propositions for future empirical research and discuss implications for future research.     

Exploring manager’s perspective of service quality strategies in Malaysian Banking Industry

In service industry, the subject of service quality remains crucial as business strive to maintain a comparative advantage in the marketplace. In aftermath of globalization, the operating environment for banking industry has become more dynamic and competitive. Banks have evolved to become diversified financial providers instead of traditional banking-only service providers. With bank placing emphasis on a mutually beneficial bank–customer relationship, customer loyalty must be pursued through repeat purchases. Central to achieving this is often the quality of services offered by the bank should satisfy the customer’s needs. This article attempts to identify any service gaps in Malaysian banking industry and to recommend effective strategies to close these service gaps from bank mangers’ and executives perspectives based on GAPs Model of Service Quality (GAPs Model). Using qualitative data collected from interviews with 30 bank managers and executives, this article provides effectives strategies to close each of the gaps in GAPs Model. It is hoped that the empirical evidences and recommendations provided in this article shed some light to management of banks to improve upon their customer service quality in order to benefit from customer satisfaction, customer loyalty and other behavioural outcomes which will lead to greater competitive advantage and profitability to the banks concerned.     

Subsidiary’s Network Competence: Finnish Multinational Companies in Russia

We provide clear insights into the key foreign direct investment obstacles for the manufacturing sector in FYR of Macedonia, an EU candidate country. The survey results, based on data for 79 manufacturing companies, revealed that the investors in this particular sector perceive the bureaucratic and administrative constraints, corruption and bribery, and the lack of law enforcement as three major investment obstacles. Furthermore, we found that the perception of the investment obstacles largely differ depending on the industry the companies operate in, the country of origin, and the export orientation. Therefore, we recommend a tailor-made approach in pursuing the national investment promotion policies and strategies.     

Value creation through production offshore–inshore strategies in a footwear industry cluster: A coevolutionary perspective

In many industries, production offshoring towards countries with low labour costs has been a common trend in recent decades. However, we find some resistance to dismantling factories in a footwear industry cluster in Spain. From a customer perspective of value creation, and based on qualitative and quantitative data, we analyse the evolution of firms’ offshore–inshore strategies associated with the main periods of cluster expansion and contraction over the last 25 years. We highlight three main findings. First, the pressures of the environment can terminate firms but not necessarily the entrepreneurial orientation of their owners to continue in the same industry. Second, adaptive processes to create value for the consumer in the footwear industry seek a balance between production offshoring and domestic production in order to optimize the firm's competitive position. Third, coevolutionary theory should consider not only the selection and adaptation processes but also the capacity of firms to influence their environment, since the alternative strategies to create value for customers in footwear industry have resulted in speeding up the footwear fashion market. We also suggest implications for research and practice.     

Internationalization and HRM strategies across subsidiaries in multinational corporations from emerging economies—A conceptual framework

The rapid rise of multinational Corporations (MNCs) from emerging economies has led to greater interest and urgency in developing a better understanding of the deployment and diffusion of managerial strategies from their perspective and without assuming the prevailing Western ethnocentric orthodoxy. This paper develops a conceptual framework of global HR strategies and practices in MNCs from emerging economies across their subsidiaries in both developed and developing markets. Using data from a pilot study of an Indian MNC, it provides insights and guidance into the motives, strategic opportunities and constraints in cross-national transfer of HR policies and practices in a multi-polar world.     

The Localization Choice of Multinational Firms’ R&D Centers: A Survey in the Piedmont Area

Research on the linkages between R&D, environment, strategy, and localization choices is quite new and often lacks empirical investigation. The aim of this article is to study the localization choices of MNE R&D activities in Piedmont. Specifically, it investigates the extent of locating in a specific place on the strength of several drivers and the level of satisfaction of the choice after 3 years from the settlement. The findings aim to verify the main drivers that led 51 MNE to choose Piedmont as the ideal area for their R&D activities and also to show how the high level of presence after 3 years from the settlement confirms the result.     

Customers’ intention to adopt smart lockers in last-mile delivery service: A multi-theory perspective

Many logistics service providers are now adjusting their business service strategies to satisfy consumers' higher demands and expectations. An automated parcel locker for self-pickup is one of the options; however, there is currently no smart locker service available in Thailand. This study integrates resource matching theory, innovation diffusion theory, and theory of planned behavior to clarify Thai consumers' intention to utilize smart lockers. The data for this study were received from 302 participants living in Thailand. Convenience, reliability, privacy security, compatibility, relative advantage, complexity, perceived behavioral control, and attitude were included in the questionnaire to test if they were significant determinants of consumers' intention to use smart lockers. The results reveal that convenience, reliability, privacy security, compatibility, relative advantage, complexity, perceived behavioral control, and attitude influence Thai consumers’ intention to use smart lockers. This study contributes to the literature on combining resource matching theory, innovation diffusion theory, and theory of planned behavior; this enriches theoretical research on self-service technologies in last-mile logistics delivery, and also provides insights for consumer behavioral research.     

“Lending by example”: Direct and indirect effects of foreign banks in emerging markets

Using a novel dataset that allows us to trace the bank relationships of a sample of mostly unlisted firms, we explore which borrowers are able to benefit from foreign bank presence in emerging markets. Our results suggest that the limits to financial integration are less tight than the static picture of firm-bank relationships implies. Even though foreign banks are more likely to engage large and foreign-owned firms, after an acquisition, a bank is 20% less likely to terminate a relationship with a firm if the acquirer is foreign rather than domestic. Most importantly, within a credit market, firms appear to have the same access to financial loans and ability to invest whether they borrow from a foreign bank or not, while foreign banks benefit all firms by indirectly enhancing credit access.     

Creativity identity in Colombia: the advertising creatives’ perspective

ABSTRACT

This exploratory paper analyses the way in which context influences advertising creativity practices. To establish the role of context, this paper utilized both Social Identity theory and Systems Model of Creativity. Twenty four in-depth interviews with top creative directors of the main advertising agencies in Colombia (Latin America) were collected. Findings suggest the Colombian creative identity is under construction. This identity is influenced by the broader Colombian social context including the unique business characteristics of the country's communications industry, the level of economic hardship experienced by the population, and the actual social conflict lived situation. These findings extend the Systems Model of Creativity to include social hardships and industry level characteristics. Several practical implications not only in relation to Colombia, but also the broader global advertising industry are presented.     

Adoption of augmented reality in online retailing and consumers’ product attitude: A cognitive perspective

With the application of augmented reality (AR) technology by online retailers to improve online services, the impact of AR adoption on consumer behavior has attracted attention both in academic and in practical circles. Based on the cognitive perspective of information processing and from the two aspects of cognitive load and cognitive fluency, this study discusses the influence of AR adoption on online consumers' product attitudes. The results of the experimental study show that two AR characteristics—environmental embedding and simulated physical control—can reduce consumers’ cognitive load, enhance their cognitive fluency, and improve their product attitude. Furthermore, product type can moderate the influence of AR environmental embedding and simulated physical control on cognitive fluency.