Contrary to contentions in earlier literature that emerging multinationals are only regional players, the evidence on the globalness of Indian firms presented in this study suggests that a number of ...emerging multinationals are global firms. Their strategies target both the developed and the developing markets and the intensity of their overseas operations is comparable with or far greater than those of the world’s leading multinationals. Many of these firms have greater sales or capital assets outside their home base. Indeed, many of them qualify as global firms as they have a significant presence (over 10% of sales) in each of the four regions (the triad and the non-triad developing regions) and no region alone accounts for more than 50% of their global sales. The study of the transformation of emerging multinationals into non-home region players provides considerable potential for better understanding management theories and practices.
Subsidiaries conduct innovation activities in foreign markets either to capture valuable knowledge that is necessary to adapt their products to local markets or to create valuable knowledge for ...headquarters. For emerging market multinationals, most studies have overlooked the determinants of successful reverse knowledge transfer from subsidiaries located in emerging and developed markets. This paper analyzed the responses of a survey administered to 78 Brazilian multinationals that own subsidiaries in developed and emerging markets. We found that knowledge complexity developed at the subsidiary, its autonomy and embeddedness in the foreign market determine the successful reverse knowledge transfer to headquarters of emerging market multinationals. This paper contributes to previous studies of reverse knowledge transfer by underlying the main drivers for emerging market multinationals.
Subsidiárias realizam atividades de inovação em mercados estrangeiros, quer para capturar o conhecimento valioso que é necessário para adaptar seus produtos aos mercados locais ou para criar conhecimento de alto valor para a sede. No contexto de multinacionais de mercados emergentes, a maioria dos estudos têm negligenciado os determinantes da transferência de conhecimetno provenientes de subsidiárias (transferência reversa). Foram analisadas as respostas de uma pesquisa realizada com 78 multinacionais brasileiras que possuem subsidiárias em mercados desenvolvidos e emergentes. Verificou-se que a complexidade do conhecimento desenvolvido na subsidiária, bem como a sua autonomia e inserção no mercado externo determinam o fluxo de transferência reversa de conhecimento na empresa multinacional emergente. Este trabalho enriquece estudos anteriores sobre transferência reversa de conhecimento destacando os principais drivers para as multinacionais dos mercados emergentes.
Filiales realizan actividades de innovación en los mercados extranjeros, ya sea para capturar el conocimiento valioso que es necesario para adaptar sus productos a los mercados locales, o con el fin de crear conocimiento de alto valor para su sede. Respecto a las multinacionales de mercados emergentes, en la mayor parte de los estudios no se ha dado la debida atención a los factores determinantes de la transferencia de conocimiento a partir de filiales (transferencia inversa). En este estudio se analizan las respuestas de una encuesta realizada a 78 multinacionales brasileñas que poseen filiales en mercados desarrollados y emergentes. Los resultados indican que la complejidad del conocimiento desarrollado en la filial, así como su autonomía e inserción en el mercado externo determinan el flujo de transferencia inversa de conocimiento en la empresa multinacional emergente. Con este trabajo, se colabora al desarrollo de los estudios acerca de la transferencia inversa de conocimiento, con énfasis en los principales drivers para las multinacionales de mercados emergentes.
This paper aimed to evaluate the product innovation as a resource in the internationalization process of an emerging multinational (EMN), the Brazilian company Taurus in the North American market. ...Through the lenses of the Resource Based View (RBV), we discuss the role of product innovation, the case of The Judge revolver, as a resource for competitive advantage in the internationalization process of an EMN. In-depth interviews were conducted with managers involved in the development and introduction of the product into the USA market, as well as document analysis and direct observation. The results indicated that an innovative product can be vital for an emerging multinational entering a developed market. Other result points out that an innovative product of an EMN is capable of provoking competitive responses in developed markets where the product was introduced.
The recent spate of large cross‐border acquisitions – for example, Tata Steel–Corus, Hindalco–Novelis, and Tata Motors–Jaguar/Land Rover – and greenfield investments by Indian companies have helped ...in focusing attention on the emergence of new corporate players on the global scene. India's emergence as a source of foreign direct investment outflows is impressive for its level of development. It is argued that the destinations, sectoral composition, motivations, and entry strategies of Indian investments have been changing with magnitudes. This paper examines the sources of Indian companies’ ownership advantages and trends, patterns, and implications. It has been argued that the source of their ownership or competitive advantage lies in their accumulation of skills for managing large multilocation operations across diverse cultures in India and in their ability to deliver value for money with their “frugal engineering skills” honed up while catering to the larger part of income pyramid in India.
This paper presents five facts of industry upgrading of emerging multinationals with and without foreign affiliates. This paper studies product and process innovation and investment in technologies ...and management practices as industry upgrading. Firm-level evidence from Indonesia, Thailand, the Philippines, and Vietnam suggests that there are not significant differences in innovation and investment between firms with foreign affiliates and firms without foreign affiliates, but there are sizable differences in organizational changes across locations of foreign affiliates. Firms' self-reported buyer and supplier data also suggest spillover effects between downstream and upstream firms within a single global or local production chain. We establish five facts about intra-firm management practices and inter-firm relationships in production networks within southeast Asia as follows: (1) Firms are more likely to extend the geographic scope of their foreign platforms if they run both exporting and importing; (2) firm size and R&D sales ration play a role of foreign platforms in ASEAN, Europe, and the USA, but these have no effects on foreign platforms in east Asia; (3) emerging multinationals do not achieve product development if they have foreign platforms in east Asia while they achieve product development if they establish foreign platforms in Europe and the USA and (4) the type of organizational process improvements vary with locations of foreign platforms, i.e. foreign platforms in Europe and the USA can deliver knowledge about higher quality products instead of prohibiting new intermediate inputs; (5) emerging multinationals are more likely to share information with supplier for quality control within a production chain if they have foreign affiliates in Japan. These facts first serve as a basis of the intra- and inter-firm managerial practices of a global production chain in emerging markets.
Purpose
– The apparent success of emerging market multinational (EMNE) operations in the Global South has led some to launch a claim of competitive advantage in investing in markets with higher ...institutional risk. However, there has not been sufficient econometric investigation into all the forces driving South-South foreign direct investment (FDI). The purpose of this paper is to investigate the claim of institutional advantage and to further our understanding of South-South FDI.
Design/methodology/approach
– The paper employs a simple econometric model of FDI flows to investigate the differences between the factors driving FDI from developed country MNEs and EMNEs. The model is tested on a bilateral sample of FDI stock data of 21 developed and 22 emerging source economies and over 80 host countries.
Findings
– Contrary to the contention of the previous literature, the empirical results find little support for the claim to EMNE institutional advantage. EMNEs are just as sensitive to institutional risk as MNEs. The relatively higher participation of EMNE FDI in the Global South may be explained by other shared similarity factors across developing markets and competitive disadvantages in entering developed markets.
Originality/value
– The findings of this paper cast some doubts on the hope that EMNEs will improve the FDI demands of least developed countries (LDCs). Healthy institutions are an important prerequisite for attracting FDI, regardless of whether it originates from developed or emerging economies.
The objective of the present paper is to provide a review of the current state of empirical research on emerging multinational enterprises (EMNEs) carried out in Poland. The review of empirical ...studies reveals that first exploratory efforts have already been undertaken to unbundle the motivations, geographic patterns, modes and resource advantages. Firm-specific resources are an important determinant of internationalisation and its performance outcomes. Major FDI projects of Polish firms are located in neighbouring countries, which expresses the still limited scope of emerging MNEs' international operations. Present research predominantly recurs to descriptive statistics, thus not contributing to the understanding of relationships between motives, strategies and outcomes of Polish EMNEs. Future studies should rely on larger samples and more refined research designs to enable normative contributions, particularly in relation to the competitiveness effects of foreign expansion.
Este estudo preocupa-se em questionar se as teorias tradicionais de internacionalização são adequadas para explicar a expansão internacional das multinacionais de países emergentes. Procurando ...avançar nessa questão, investigam-se as estratégias de internacionalização adotadas pela JBS, multinacional brasileira do setor frigorífico. Os resultados evidenciam que a empresa adotou duas das cinco estratégias genéricas específicas ao contexto de países emergentes sugeridas por Ramamurti e Singh (2009): consolidador global e integrador vertical. Além disso, ao analisar a internacionalização da empresa em estudo, chama atenção a velocidade do processo, em comparação às multinacionais tradicionais. Conclui-se que o principal modo de entrada que possibilitou a expansão internacional foi a aquisição e que essa trouxe vantagens à empresa, como o acesso a recursos estratégicos, o crescimento rápido, a possível superação da liability of foreignness, a oportunidade para competir globalmente e a diversificação dos segmentos de atuação que geram sinergias às atividades da empresa.
Este estudio cuestiona si las teorías tradicionales de internacionalización son adecuadas para explicar la expansión internacional de las multinacionales de países emergentes. Con el propósito de avanzar en esa cuestión, se investigan las estrategias de internacionalización adoptadas por JBS, multinacional brasileña del sector frigorífico. Los resultados evidencian que la empresa adoptó dos de las cinco estrategias genéricas, específicas del contexto de países emergentes, sugeridas por Ramamurti y Singh (2009): Consolidador global e integrador vertical. Además, al analizar la internacionalización de la empresa en estudio, llama atención la velocidad del proceso, en comparación a las multinacionales tradicionales. Se concluye que el principal modo de entrada que posibilitó la expansión internacional fue la adquisición y que esta le trajo ventajas a la empresa, como el acceso a recursos estratégicos, el crecimiento rápido, la posible superación de la liability of foreignness, la oportunidad para competir globalmente y la diversificación de los segmentos de actuación que generan sinergias a las actividades de la empresa.
The focus of this study is on questioning whether the traditional theories of internationalization are adequate to explain the international expansion of multinationals from emerging countries. Looking forward on this issue, we investigate the internationalization strategies adopted by JBS, a Brazilian multinational of the beef industry. The results show that the company adopted two of the five generic strategies specific to the context of emerging countries suggested by Ramamurti and Singh (2009): global consolidator and vertical integrator. Moreover, when analyzing the internationalization of the company under study, the speed of the process is highlighted when compared to traditional multinationals. It is concluded that the main mode of entry that allowed the international expansion was the acquisition and that this strategy has advantages to the company, such as access to strategic resources and rapid growth, possibly overcoming the liability of foreignness, the opportunity to compete globally and the diversification of segments that generate synergies to the company's activities.
Purpose
– The purpose of this paper is to understand and map the global competitiveness of firms in emerging markets. The authors refine a framework (called the “strategic control map”, or SCM) that ...looks at market capitalization – using two parameters of book equity (size) and price to book ratio (performance) – as a key driver of the competitiveness of firms. However, the SCM has limited value in the context of smaller and largely domestic firms, as is the case in emerging markets. To develop a more comprehensive understanding, additional vital metrics such as the degree of internationalization need to be considered.
Design/methodology/approach
– The authors compare top 100 Indian firms against global firms on four dimensions – i.e. market price to book ratio, book equity, scope and scale of international operations. The authors consider data for the year 2009-2010 to make comparisons.
Findings
– The SCM, formulated with a developed market focus, is not suitable in the context of emerging markets as it fails to consider internationalization as essential to compete at the global level. Accordingly, the authors propose a new conceptual framework, referred to as the “strategic positioning map” (SPM).
Originality/value
– In this paper, the authors argue that “international intensity” and “market capitalization” can be two important dimensions to map the relative paths of growth for firms from emerging markets.
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