Edited by Léo-Paul Dana
Chapter 13: Marshalling Relations
Hamid Etemad Introduction Markets were traditionally segmented: large companies competed in international markets while smaller businesses remained local or regional. However, the global competitive environment is changing dramatically: the drivers of globalization are removing the barriers that segregated the competitive space of the small and the large ﬁrms; ﬁrms of all sizes have begun to share the same competitive space (Etemad, 1999); it is becoming increasingly diﬃcult for independent small ﬁrms to thrive on their own unless they are globally competitive. As smaller ﬁrms are forced to compete in the global markets, they are seeking, and also experimenting with, new arrangements for internationalization, including a rich range of collaborative networks. Some of these arrangements are rival models to multinational enterprises (MNEs). They also put smaller ﬁrms in direct competition with these large and integrated ﬁrms in the international competitive landscape (Dana, Etemad and Wright, 2001; Etemad, 2003). As these emerging models of international business competition involve both the small and the large enterprises, each relying on diﬀerent sets of capabilities and skills, and invoke diﬀerent strategies as a basis of competition in the global environment, the traditional theories of internationalization are rendered impotent. Paramount among these capabilities, especially with smaller ﬁrms, is the ability to manage their relations with others. The primary objective of this chapter is to demonstrate that patterns of growth and international expansion are increasingly dependent on managing an enterprise’s commercial, industrial and even political interactions with a host of other ﬁrms, associates and...
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