Business Internationalization and Co-evolution of Organizational Identities

Abstract

This paper analyzes the history of Brother Industry Ltd. to propose a new take on the conventional wisdom surrounding the internationalization of Japanese companies—a common understanding that the key factor behind Japanese firms’ successes in establishing an international competitive edge was how the companies’ headquarters in Japan implemented a powerful combination of control and integration over their international distributors and moved up from low-end markets to high-end markets through unyielding technological development. By exploring the case of Brother Industry Ltd., we locate a different path to growth where highly autonomous local subsidiaries sought to remain in low-end markets and thereby helped their companies develop into major enterprises through successive instances of what Clayton M. Christensen defined as “disruptive innovation.” To establish a logical foundation for our argument, we root our approach in examining the conflict and co-evolution that arises between two different organizational identities.