Managing the Embedded Multinational

Managing the Embedded Multinational

A Business Network View

Mats Forsgren, Ulf Holm and Jan Johanson

This book expands the business network view on managerial issues in multinational corporations. Specifically, it scrutinises the importance of a subsidiary’s external and internal business network for its strategic and organizational role within the corporation.

Chapter 3: Development of Business Relationships – The Case of Danke

Mats Forsgren, Ulf Holm and Jan Johanson

Subjects: business and management, international business


In Chapter 1 we presented our view of the embedded MNC and emphasized the distinctive characteristic role of the business relationships of the MNC units. In Chapter 2 we described at some length the nature of these business relationships, how they come to comprise the business network of a firm, building networks that extend beyond markets, technologies, industries and countries. In the present chapter we present a case to illustrate some important features of business relationships, how they develop over time and the different roles that they may have in the firm. The case is based on a study of Danke, a firm in the paperboard packaging industry, that was carried out between the years 1991 and 1998. The information about this firm was gathered through successive interviews with managing directors, and sales and purchasing managers. This firm is recognized as possessing a high level of technological competence; it is also unusually international for a firm in its field of business. The case shows how Danke and some of its suppliers and customers successively developed cooperative relationships, and how this in turn affected the firm’s competence in developing products, production and business exchange procedures. The focus here is on the development of a set of dyadic relationships. In the following chapter the dynamic connections between these relationships will be analysed. BUSINESS RELATIONSHIPS – A RECAPITULATION As business relationships are the fundamental building blocks of the theory of the embedded MNC outlined in this book, there is good reason to consider the...

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