Making Geographic Dispersion Work for Emerging Market MNEs

Abstract

A growing body of research probes into the unique ownership advantages of emerging market MNEs (EMNEs) to uncover the sources of their counterintuitive success, when judged from the perspective of traditional theories in international business. Although research documents that EMNEs expand into spatially distant countries to prompt a global catch-up in competitiveness, how such geographic dispersion results in improved performance remains unclear. Per the springboard perspective, adaptability and ambidexterity may facilitate post-springboard success. We advance this logic, submitting that EMNEs fulfill adaptability advantages through strategic agility, and ambidexterity advantages through structural mediums that support adaptive integration. We propose that these strategic and structural enablers foster a positive relationship between geographic dispersion and performance. Our study is based on data from 220 MNEs headquartered in China. The results indicate that strategic agility, integration capability, and autonomy delegation promote the positivity of geographic dispersion. These findings enlighten EMNE research in organizing post-springboard activities that involve geographically dispersed operations.