Session 381

Firm boundaries in Multinational Organizations: Antecedents and Consequences

Track G

Date: Monday, September 22, 2014

 

Time: 14:45 – 16:00

Common Ground

Room: Luxemburgo


Facilitator:

  • Vikas Kumar, University of Sydney

Title: A Behavioral Explanation for Unequal Practices Coupling in MNCs

Authors

  • Anne Jacqueminet, Bocconi University

Abstract: This paper focuses on subsidiary-level coupling mechanisms through which concrete practices follow formal policies in MNCs. We argue that the implementation of CSR practices is hard to enforce in an MNC and that heterogeneous policy-practices coupling is better explained by behavioral mechanisms related to the assessment of the appropriateness of the practices. We propose that appropriateness can be assessed with reference to internal values or with reference to adoption by peers. Moreover, we suggest that consequentialism reinforces both types of appropriateness assessment, while internal and external appropriateness references are substitutes. The results of our study on the implementation of CSR practices by 99 subsidiaries of an MNC show that behavioral explanations overrule top down influence and confirm our reinforcing and substituting predictions.

Title: Different Strokes for Different Folks

Authors

  • Nikhil Celly, HanCelly
  • Venkat Subramanian, Nazarbayev University

Abstract: Emerging market MNEs are being recognized as “Tomorrow’s global giants”. Their increasing influence affects existing MNEs and defines global competitive dynamics. However research has not yet developed a complete picture of the competitiveness of emerging market MNEs and their sources of advantage. An important first step is to understand the developmental paths undertaken by these EM MNEs. We identify various internationalization paths and the sequence of internationalization moves. We draw on extant international business theory to help us to frame EM MNE strategic choice of internationalization in terms of home country, host country and strategic intent of the MNE. The internationalization pathways influence the development of unique sets of resources and capabilities that in turn underlie the competitiveness and advantages (or disadvantages) or EM MNEs.

Title: How Does Experiential Learning of Emerging Multinationals Benefit Subsidiaries? A Study of Indian MNCs

Authors

  • Arindam Mondal, Indian Institute of Management-Calcutta
  • Sougata Ray, Indian Institute of Management - Calcutta
  • Raveendra Chittoor, University of Victoria

Abstract: We investigate whether accumulated international experiences of emerging multinationals (EMNCs) always aid in successful international expansion. Pursuing a subsidiary level analysis, our study advances the knowledge of the relationship between parent firm’s experiential knowledge, subsidiaries’ own experience, and the performance of its foreign subsidiaries of EMNCs. By integrating the learning theory, organizational capability and knowledge transfer literature, we predict: an inverted U-shaped relationship between subsidiary experience and focal subsidiary performance, an overall U-shaped relationship between parent firm’s general international experience and host country experience and focal subsidiary performance. We test our predictions empirically with proprietary, longitudinal data over a three year period during 2010 – 2013 for 787 foreign subsidiaries of 253 Indian MNCs and find support for the hypotheses.

Title: Staged Development of Dynamic Capability in International Joint Ventures

Authors

  • Kaushik Roy, Indian Institute of Management-Calcutta

Abstract: I investigate the micro-foundations of different stages of development of dynamic capabilities in international joint ventures. The case-based research is conducted for three heterogeneous IJVs in the Indian life insurance space. Data collection involved detailed interviews and access to other archival data. Results offer interesting insights on a) process of the development of DC, b) the relative importance of different stages in the development of DC. Sensing and seizing are the two stages in which dynamic capabilities are built, and reconfiguration/transformation is inherently subsumed within the stage of seizing. The success of sensing and seizing is facilitated by existence of a structural ecosystem within an IJV. Broad-spectrum parental contribution across different functions was found to be an impeding factor for development of DC.

Title: Transferring Tacit Know-How through Licensing or Joint Venture: Is Opportunism Really Redundant?

Authors

  • Alex Eapen, Australian National University
  • Rekha Krishnan, Simon Fraser University

Abstract: In recent years, strategy scholars have ambitiously deepened their efforts towards integrating capabilities and contractual perspectives of the firm. Much of the recent focus in the literature has been on synthesizing the two theories into one unified explanation of firm boundaries. Traditionally, however, proponents of both theories have disagreed over the role of opportunism in explaining the boundaries of the firm. We argue that there is hence a need, alongside efforts towards integrating capability and contractual theories, to revisit and reconcile this opportunism debate. This paper is an attempt in this direction. Using survey data, we empirically examine whether opportunism matters in the choice between contractual and hierarchical modes of technology transfer from multinational firms. Our results suggest that opportunism matters.

Title: What Does it Take to Cross a Border? Networks, Experience, and Cross-Border Private Equity Investments

Authors

  • Francisco Morales, University of Colorado, Boulder
  • Santiago Mingo, Adolfo Ibañez University

Abstract: Private equity (PE) firms facilitate entrepreneurship and innovation as they redeploy resources to optimize their use. Therefore, the internationalization of PE firms can be an important driver of entrepreneurship and innovation worldwide. However, in contrast to cross-border venture capital investments, cross-border PE investments have not been extensively investigated. In this study, we propose and find that a PE firm that is more central in the syndication network, either in the home-country or foreign network, is generally more likely to cross a border when investing. The results also show that investment experience acts as a moderator in the previous relationships. We test our hypotheses using a sample of 325 PE firms from the United Kingdom that made 5,368 investment transactions in Europe from 1996 to 2011.

All Sessions in Track G...

Sun: 08:00 – 09:15
Session 389: Managing the Multinational Organization in an Increasingly Complex World
Sun: 09:30 – 10:45
Session 221: Global Stakeholder Networks
Session 390: Local Determinants of Competitive Advantage and Disadvantage
Sun: 11:15 – 12:30
Session 2: Offshore Outsourcing, Dynamic Capabilities, and the Changing Nature of Firm Boundaries
Sun: 15:45 – 17:00
Session 270: Innovation in MNCs and Global Networks
Session 371: Inter and Intra Organizational Learning Across Borders: A Knowledge Management Perspective
Session 380: Small, Young and Entrepreneurial Firms: A Unique Perspective in Globalization
Sun: 17:15 – 18:30
Session 603: Global Strategy IG Business Meeting
Mon: 08:00 – 09:15
Session 335: Internationalization and Strategic Decisions
Session 379: Emerging Markets: Understanding the Importance of Context
Mon: 11:00 – 12:15
Session 372: The Challenges of Global Operations: Managing R&D and Complexity
Session 373: Global Diversification: Governance and Performance Implications
Mon: 14:45 – 16:00
Session 375: Changing External Environments: How do Multinationals Respond?
Session 381: Firm boundaries in Multinational Organizations: Antecedents and Consequences
Session 414: Global Networks and Business Groups
Mon: 16:30 – 17:45
Session 226: Culture, Norms and Institutions: The contextual influences on Entrepreneurship
Session 374: Antecedents and Consequences of Multinational Location Decisions
Session 382: Drivers of Multinational Performance:What, Where and When?
Tue: 08:00 – 09:15
Session 383: Globalization of R&D: Implications for Learning and Innovation
Tue: 11:00 – 12:15
Session 376: Headquarters Subsidiary Relationship: New Approaches to an Old Question
Session 384: Multinational Location Decisions: New Approaches Across Different Perspective
Tue: 15:30 – 16:45
Session 263: Innovation Models in Emerging Economies
Session 377: Organizing Assets Across Borders: Drivers and Consequences
Session 385: Multinational firms and the External Environment: The Role of Institutions
Tue: 17:15 – 18:30
Session 378: Global Outsourcing & Offshoring: Implications for Multinational Decisions


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