Competing with the Japanese—Strategies for European business

Abstract

The theory of corporate strategy and strategic management has changed rapidly over the last 6 years by admitting into its mainstream a body of literature that focuses on the international competitiveness of nations. The models, however, made little or no allowance for the influence of such important factors as the regionalization of world markets, the evolution of technology and the influence of (supranational) governments. This article argues that an alternative theory of international competitiveness that links the concepts of industrial policy and global strategy would provide a better understanding of the ‘war’ for market share between emerging trade blocks and between their respective global corporations. To cope effectively with Japan's protectionism and MITI's administrative guidance, the industrial structure that supports European power must become competitive in world commercial markets. Management of European companies, for that matter, has to become truly global in its mentality and skills. And beyond that, the European Commission in Brussels will have to formulate a restrictive industrial policy.