The dominant strategic positioning of foreign MNCs: a typological approach and the experience of Israeli industries

Abstract

We have extended the theory of Multinational Corporations (MNCs) by focusing on MNCs' strategic positioning in a foreign market relative to their local counterparts. We propose a new typological framework that focuses on the competitive and marketing strategies of both foreign and local counter firms. Israel's growing attractiveness to foreign MNCs during the mid-1990s has been chosen to explore our propositions. A sample of 406 respondents evaluated the strategic positioning and performance of 104 firms, 56 of which were foreign MNCs and 48 of which were their local counterparts. Our findings suggest that foreign MNCs operating in Israel were perceived as superior to their local counterparts, in terms of their competitive strategy, marketing strategy, and customer satisfaction. In addition, MNCs were identified as “adaptive” organizations relative to local competitors, which were perceived to hold “myopic” strategic positions. Thus, foreign MNCs have been able to capture relatively high positions, in terms of perceived value for money.