Strategies Of Multinational Enterprises Research Articles

Violent conflict and multinational enterprises: identifying key frontiers in international business policy research

AbstractViolent conflicts are events that involve the purposeful use of violence by state and/or non-state actor(s) to achieve political objectives, which result in disruptions to the institutional environment where actors such as civil society and multinational enterprises (MNEs) are situated. Examples of violent conflicts include civil and interstate wars and terrorist attacks. Violent conflicts typically have multiple, often devastating consequences that pose difficult policy challenges for governments and MNEs. This perspective offers an international business (IB) research and policy agenda to advance our understanding of the linkages between violent conflict and MNEs, focusing on three IB research and policy frontiers: the mechanisms through which MNEs are exposed to violent conflicts globally, MNE strategies and violent conflicts, and the interplay between MNEs and violent conflict environments. We also discuss appropriate datasets and research methods for studying MNEs and violent conflict.

Adapting During Unrest: How International Businesses Navigate the Social Movement Landscape

This study investigated the strategic responses of multinational enterprises (MNEs) during the 2019 Hong Kong social movement, employing a more nuanced framework of economic opportunity structure (EOS). Our study analyzed the economic impacts and adaptive strategies of MNEs in response to social unrest. Our findings highlight the strategic rationale behind MNE decisions and provide actionable insights for navigating complex socio-political landscapes. Our findings emphasize the crucial need for MNEs to maintain a careful balance of optimizing local engagement and global imperatives. The insights are pivotal for enhancing the strategic adaptability of businesses operating in volatile environments.

Cultural Differences and Communication in the Internationalization Strategies of Multinational Enterprises

In the process of internationalization, multinational companies often face employees and customers from different cultural backgrounds. This makes cultural differences and communication major challenges. This paper analyzes communication patterns and values between different cultures and their impacts on business operations and teamwork, for instance, good cross-cultural communication can help a company to diversify, while poor cross-cultural communication can create conflicts, misunderstandings, and impediments to proper functioning. This paper also proposes effective cross-cultural communication strategies, increasing cultural awareness and sensitivity, providing employees with cross-cultural communication skills, creating an inclusive corporate culture, adopting a common working language, and using technological tools to promote cross-cultural communication. The paper concludes that cross-cultural communication is very important for Multinational Corporations (MNCs) and that MNCs may face more challenges in cross-cultural communication in the future environment, this paper hopes to offer some theoretical references for future studies.

Sustainability-driven market impacts of climate change and firms’ renewable energy innovation: a conceptual analysis

Purpose This paper aims to unravel the relationship between market-driven impacts of climate change and firms’ deployment of renewable energy (RE) innovation. The purpose is to understand how market-related forces, influenced by uncertainty, shape firms’ behaviour in response to climate change challenges. Design/methodology/approach Drawing on the behavioural theory of the firm (BTOF), the paper develops a conceptual model to decode the relationship between each category of market-driven impacts and the resulting RE innovation within firms. The model takes into account the role of uncertainty and differentiates between multinational enterprises (MNEs) and domestic firms. Findings The analysis reveals five key sources of market-driven impacts: investor sentiment, media coverage, competitors’ adoption of ISO 14001, customer satisfaction and shareholder activism. These forces influence the adoption of RE innovation differently across firms, depending on the level of uncertainty and the discrepancy between environmental performance and aspiration level. Originality/value This paper contributes to the literature in four ways. Firstly, it emphasises the importance of uncertainty associated with market-driven impacts, which stimulates different responses from firms. Secondly, it fills a research gap by focusing on the proactivity of firms in adopting RE innovation, rather than just operational strategies to curb emissions. Thirdly, the paper extends the BTOF by incorporating the concept of uncertainty in explaining firm behaviour. Finally, it provides insights into the green strategies of MNEs in the face of climate change, offering a comprehensive model that differentiates MNEs from domestic firms.

Corporate social innovation by multinationals: A framework for future research

Although multinational enterprises (MNEs) can exacerbate inequality within and across nations, they can also engage in social innovation to contribute positively to SDGs. Their social initiatives addressing societal challenges, i.e., Corporate Social Innovations (CSIs), can benefit both the firm and the society. However, with increasing pressures on MNEs to demonstrate how they meet grand societal challenges, we need to know more about how MNEs pursue their CSIs. By reviewing 34 articles in 18 journals over a 22-year period, we establish what shapes CSI by social change agents, and the conditions for, and consequences of such innovations in MNEs. The review demonstrates that CSI by MNEs is triggered by institutional contradictions or a market opportunity, shaped by (in)formal resources and skills deployed to generate ideas, piloted through multistakeholder engagement, and legitimated through showcasing and framing to generate impact that contributes to SDGs. Our findings set an agenda for future research on the links between CSI activities and different CSI stages and the complex dynamics arising in MNE strategies aimed at reconciling opposing institutional logics and the impact of MNE home institutional contexts.

Global Talent Management: A Critical Review and Research Agenda for the New Organizational Reality

Global talent management (GTM) refers to management activities in a multinational enterprise (MNE) that focus on attracting, motivating, deploying, and retaining high performing and/or high potential employees in strategic roles across a firm's global operations. Despite the critical importance for individual and firm outcomes, scholarly analysis and understanding lack synthesis, and there is limited evidence that MNEs are managing their talent effectively on a global scale. In this article, we review the GTM literature and identify the challenges of implementing GTM in practice. We explore how GTM is aligned with MNE strategy, examine how talent pools are identified, and highlight the role of global mobility. We discuss GTM at the macro level, including the exogenous factors that impact talent management and the outcomes of GTM at various levels. Finally, we identify some emerging challenges and opportunities for the future of GTM.

Analysis of Executive Compensation Management Strategies of Multinational Enterprises in the Context of RMB Internationalization

Abstract This paper applies the EVA-based bonus incentive model and the EVA-based stock option incentive model to the executive compensation incentive system of multinational enterprise D and calculates the EVA amount by combining the profitability of multinational enterprise D and compares it with the net profit amount of the enterprise to obtain the difference between the two. In order to further investigate the relationship between the EVA amount and the net profit of multinational enterprises, the correlation hypothesis between executive compensation and the management of accrued surplus and the management of actual surplus is carried out, respectively. The countermeasures for the management of executive compensation in multinational enterprises under the background of the internationalization of the RMB are proposed according to the establishment of the research hypothesis. Executive compensation and accrued surplus management are negatively correlated, as shown by regression analysis, and an increase in the former will have a significant inhibitory impact on accrued surplus management behavior. There is a positive correlation between executive compensation and natural surplus management, and the significance level is 5%. This means that the increase in executive compensation has a promotion effect on natural surplus management.

The Multinational Enterprises Strategies in Emerging Economies

The purpose of this paper is to review international business articles, particularly what strategies in emerging economies and multinational enterprises subsidiaries strategies. There are two main papers utilized, the first one is Hoskisson, Eden, Lau and Wright's 2000 article, entitled Strategy in Emerging Economies. Strategy formulation and implementation by private and public enterprises in a variety of regional contexts and from three major theoretical perspectives: institutional theory, transaction cost economics, and the resource-based view of the firm. The second paper is Amy J Hillman and William P Wan's 2005 article, The Determinants of MNE Subsidiary Political Strategies: Evidence of Institutional Duality. Using recent theoretical advances in institutional theory that acknowledge that MNE subsidiaries face pressures for isomorphism both within the corporation (internal legitimacy) and within the host country (external legitimacy). A common thread can be drawn between these two articles, namely the use of institutional theory in determining the strategy for multinational enterprises.

The Multinational Enterprises Strategies in Emerging Economies

The purpose of this paper is to review international business articles, particularly what strategies in emerging economies and multinational enterprises subsidiaries strategies. The first paper is Hoskisson, Eden, Lau and Wright's 2000 article, entitled strategy in emerging economies. Emerging economies are low-income, fast-growing countries that rely on economic liberalization as their primary growth engine. Emerging Economies investigates strategy formulation and implementation by private and public enterprises in a variety of regional contexts and from three major theoretical perspectives: institutional theory, transaction cost economics, and the resource-based view of the firm. The second paper is Amy J Hillman and William P Wan's 2005 article, The Determinants of MNE Subsidiary Political Strategies: Evidence of Institutional Duality. A model of the determinants of political strategies used by foreign subsidiaries of multinational enterprises (MNEs) is developed and tested in this study by integrating international business and political strategy literature to create a multilevel model of the subsidiary, host country, and parent determinants of political strategy. Using recent theoretical advances in institutional theory that acknowledge that MNE subsidiaries face pressures for isomorphism both within the corporation (internal legitimacy) and within the host country (external legitimacy). A common thread can be drawn between these two articles, namely the use of institutional theory in determining the strategy for multinational enterprises.

Why Do Subsidiaries Divest? The Role of Subsidiary Performance, Slack Resources, and Sunk Costs

Subsidiaries are important in the global strategy of multinational enterprises (MNEs). However, in the face of uncertainty and competition, the decision to divest a subsidiary from a market becomes a critical decision for MNEs. This study suggests that the factors for divesting subsidiaries are related not only to the performance of the subsidiary but also to slack resources and sunk costs. It analysed 254 subsidiaries in Taiwan and found that the better the subsidiary’s performance is, the less it would decide to divest from the market. Additionally, it was found that the subsidiary with slack resources would be a moderating variable with a positive impact. In addition, the presence of sunk costs reinforces the positive effect of slack resources on the relationship between subsidiary performance and the non-divestment of the subsidiary. Overall, this study points to the significance of subsidiary performance on decision-making and explains the influence of slack resources and sunk costs.

Marketing Strategies of Multinational Enterprises in China--Taking Wal-Mart as an Example

This paper takes Wal-Mart as an example to analyze transnational marketing strategies. The importance of the research topic is to find out the advantages and disadvantages of multinational enterprises in China, as well as what strategies multinational enterprises should adopt in the process of transnational operation. This topic is chosen because the economy is becoming increasingly developed, the economic activities of countries and regions worldwide are interdependent, and the transnational marketing of enterprises is increasing. As a representative company with the largest turnover in the world, the advantages and disadvantages of Wal-Mart are discussed with case studies. This can serve as a learning target for other multinational companies to draw experience and enhance the cross-cultural concept. It can also avoid the problems caused by the excessive pursuit of low cost and the phenomenon of "acceding to the soil" when entering the Chinese market. Multinational enterprises in China should attach importance to localization and accurate positioning of enterprises in combination with the actual situation.

Win-win strategies for firms operating in resource-abundant countries: Technological spillovers and a collaborative diversification policy

This paper responds to the growing need to be aware of the opportunities presented by technology spillovers resulting from value co-creation supported by diversification policies in resource-abundant host countries. It examines the effects of such a policy on both the local market strategies of multinational enterprises (MNEs) and on technological upgrades of local companies, where such policies require international oil and gas companies to build linkages to induce spillover. We argue that the effects of the policy with regard to spillovers can depend on the actors’ approach to collaboration. To suggest a theoretical foundation for such a collaborative approach, we integrate the value co-creation perspective with the concept of spillovers. The resulting approach is based on win-win strategies: the internationalization of the resource sector, and a shift towards the provision of service-based economy aid in an attempt to develop opportunities for sustainable operations on the part of multinationals in resource-abundant host countries. The development of local capabilities resulting from technological spillovers can enable local businesses to have access to international expertise in technology, create strategic opportunities and introduce long-term benefits for both local and international companies. This study adopts an abductive method as the basis for logical reasoning, employing an analysis of multilevel longitudinal case studies based on interviews with experts and multiple sources of industry documentation.

Market exit and re-entry in a volatile emerging economy: a case study of Yamaha motorcycles in Pakistan

PurposeThis study aims to understand the dynamics underpinning the exit and re-entry strategies adopted by multinational enterprises (MNEs) in an emerging market, Pakistan.Design/methodology/approachThis study undertook an in-depth historical case study of Yamaha Motorcycles, which had initially entered Pakistan as a joint venture but had then exited and re-entered as a wholly owned subsidiary.FindingsThis study found that, despite its status as a market leader and one of the older players in the Pakistani market, changing market dynamics in the 2000s – especially the increased competition brought by more affordable (inexpensive) Chinese motorcycles and the weak enforcement of industrial policies – had pushed Yamaha Motorcycles to exit. Another factor that had contributed to its exit were differences in risk perception and strategies with its local joint venture partner (a Pakistani business group). Hence, both firm-level and institutional factors had played significant roles in Yamaha’s market exit. This study further found that re-entering in a wholly owned subsidiary operation mode had been beneficial for the firm, as it gained a significant market share due to its focus on innovation and on capturing a market niche, which had earlier not been its main focus. The findings also suggest that opportunity logics and multiple forms of learning can be important for a firm’s re-entry into a host market – such as experiential (i.e. learning from experience) and vicarious learning (i.e. learning from other organizations, including suppliers and competitors) in an emerging market context, in which institutions evolve amid political and policy uncertainty. Finally, this study found that exit and re-entry timing is an important factor for the development of competitive advantage in a host market.Originality/valueThis study is among the few to have investigated the exit and re-entry strategies of MNEs in emerging markets. The relatively short time during which Yamaha Motorcycles had been out of the market had benefited it on its re-entry, as the firm had been able to capitalize on its prior learning and ties to suppliers’ networks.

Drivers of R&D greenfield investment projects in the communications, software and IT service industries in developing countries

Globalization has led to the decentralization of research and development (R&D) activities by multinational enterprises (MNEs). Investment in these activities is affected by both the host-country environment and the investment strategies of the entrant MNEs. Using data on greenfield R&D investment projects for a sample of digital MNEs in the communications, software and IT service industries during the period 2003–2019, we investigate the importance of host-country characteristics on MNEs’ R&D investment and examine the moderating role of the host country’s innovation capabilities as well as two strategies – exploitation versus exploration – on the part of MNEs. We find that the size of investment projects is larger in developing countries than in developed ones, especially when host countries have stronger innovation capabilities and when MNEs pursue strategies of exploitation rather than exploration. Our findings contribute to the extant research in this area and furnish related policy implications for developing countries.

Corruption distance and the equity-based foreign entry strategies of multinational enterprises in sub-Saharan Africa

Corruption distance and the equity-based foreign entry strategies of multinational enterprises in sub-Saharan Africa

MULTINATIONAL COMPANIES' RISK MANAGEMENT STRATEGIES EVOLVING ON THE BRINK OF THE NEW ECONOMIC ERA

In today's dynamic macroeconomic environment, multinational enterprises (MNEs) must have a well-defined approach to risk management in order to survive and thrive. The risk management strategies employed by MNEs must adapt to the ever-changing global economy and the associated geopolitical and climatic changes. Furthermore, the clear prospects for further developments in risk management research create new determinants for the evolution and development of corporate governance systems in MNE. This is especially true in the New Economic Era, where globalization has opened markets to new opportunities and threats. Risk management is a critical factor that impacts the financial, operational and strategic success of MNE. Therefore, it is imperative that MNE invest in developing robust risk management strategies that can keep pace with the ever-changing world economic system. Failure to do so could encourage potential business risks such as financial liabilities, low customer satisfaction, or reputational damage. It is clear that risk management is an essential part of ensuring success for MNEs in today's dynamic macroeconomic environment. The subject and object of research are defined as corporate strategies of risk management of MNE (including the approach to work with uncertainty, randomness and probabilistic thinking) and the process of their determination through the prism of influence of global economic determinants and the emerging New Economic Era. The reliability of the obtained results and conclusions of the research is substantiated by the choice of a natural methodological strategy, which includes description, explanation and prediction. Research methodology is based on a combination of methods: theoretical analysis, synthesis, comparison, systematization, and generalization of scientific literature. The aim of the research is to identify the main corporate strategies of risk management in MNEs, taking into account global economic changes, and to develop recommendations for their implementation. The studied risk management focusing exclusively on the past financial indicators of MNE activity and the conducted analysis of the emerging global challenges of the New Economic Era show a gap between the existing approaches to the formation of risk management strategies, which are based only on international standards (including reporting standards), and the urgent needs of MNEs dictated by global economic determinants. The research also creates clear prospects for further developments in the area of risk management strategies. It is suggested that more advanced approaches should be developed that take into account the dynamic nature of the international economic environment and its influence on the risk management strategies of MNEs. In conclusion, the research shows that existing corporate risk management approaches are not effective enough to respond to global economic, geopolitical, technological and social changes. Therefore, it is imperative for MNE to develop more advanced risk management strategies that can better address these changes. In addition, it is important for MNE to consider incorporating predictive analytics into their risk management processes to better anticipate potential risks before they occur.

Global R&D Location Strategy of Multinational Enterprises: an Agent-Based Simulation Modeling Approach

The global research and development (R&D) location strategy of multinational enterprises (MNEs) is examined using agent-based simulation (ABS) modeling. This study focuses on the positioning strategy of MNEs to understand the impact of their R&D location strategy. In ABS modeling, agents search for knowledge owners or universities in the global host market using Hotelling’s location model algorithm. We measure the result of increasing the number of entry agents from 2 to 121. Three types of equilibria are found in our agent-based simulation model: pure equilibrium, saturated equilibrium, and quasi-saturated equilibrium. Core locations attract MNEs, while peripheral countries in the global market are the least preferred. As a result, peripheral countries experience a paucity of foreign R&D investments. Even though emerging economies absorb foreign direct investment (FDI) inflows from MNEs, least-less developed countries (LLDC) may experience a dearth in FDI. Thus, the optimal location strategy of MNEs leads to economic disparities between the core and peripheral countries. This study suggests the need for developing official assistance to attract FDI inflows to LLDCs so that peripheral countries emerge as attractive global market destinations for MNEs.

MNEs and knowledge creation in Medellín’s emerging ICT hub

ABSTRACT This paper contributes to understanding the potential for localised knowledge creation that can be generated by multinational enterprise (MNE) entry into cities in the global South from both the MNE and the local economy’s perspectives. It presents a qualitative analysis of the activities of the MNE subsidiaries in the information and communication technology (ICT) sector in an emerging investment hub in Medellín, Colombia. The analysis differentiates between the MNEs’ local strategies to explore distinct configurations of MNE–local economy relations and their potential for unilateral or mutually beneficial knowledge creation. The findings suggest that the synergy between the MNE strategies and the evolving knowledge environment in the local economy increases the potential of the MNEs’ activities for interactive and mutually beneficial knowledge and capability creation with other local stakeholders. In Medellín, these effects predominantly concerned the market-seeking MNEs, not those seeking strategic assets, as expected by evidence in the literature. They also revealed how the specific MNE strategies tended to use and influence the creation of local knowledge resources, which helps shape policies that indiscriminately aim to attract all kinds of knowledge-intensive MNE activities to emerging investment hubs.

Subsidiary staffing strategy and innovation performance in Chinese multinational enterprises: the moderating effect of institutional distance

This article examines the impact of the staffing of foreign subsidiaries of multinational enterprises (MNEs) on the innovation performance of the parent company and the moderating effect of the institutional distance between the host country and the home country. This paper conducts an empirical analysis on the data of 59 mature Chinese MNEs and their 872 overseas subsidiaries over the past 11 years and obtains some interesting results. The results show that the proportion of host country nationals (HCNs) in overseas subsidiaries has a significant positive impact on the innovation performance of the parent company and that it is not a simple linear relationship but rather an inverted U‐shaped relationship. As HCNs increase, the ability to acquire knowledge is increasing, while the ability to integrate knowledge is decreasing. Thus, multiplicative combinations of latent mechanisms result in an inverted U‐shaped relationship. However, the institutional distance between countries negatively moderates the effect of subsidiary HCN proportions on parent company innovation performance. The findings have important practical implications for the multinational innovation strategies of Chinese MNEs and governments.

ESG Concept as the Newest Determinant of Corporate Risk Management Strategies of Multinational Enterprises

ESG Concept as the Newest Determinant of Corporate Risk Management Strategies of Multinational Enterprises