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Edited by Giovanni Battista Dagnino
Chapter 17: Multinational Firms and Competitive Strategy Research
17 Multinational firms and competitive strategy research Grazia D. Santangelo INTRODUCTION Strategy-making in multinational enterprises (MNEs) involves adopting a specific set of goals (such as internationalization, responsiveness and global integration) in order to build up and maintain a sustainable competitive advantage. Given the distinctive feature of the MNE (i.e. multi-country operations carried out through a network of multiple units), the achievement of these goals as well as of many others which may arise in the management of MNEs’ activities strongly depends on the MNE’s internal and external organizational strategy. The former concerns the structure and design of the organization as well as the strategic role that subsidiaries come to play within the MNE’s internal network. Both these aspects change as the internationalization of the firm evolves. Research on corporate organization has, indeed, documented major changes in the structure of the corporation and the role of its wholly owned subsidiaries over the past few decades. As far as external organizational strategy is concerned, for multinational (like for domestic) firms, strategic goals have been increasingly achieved by linking up to other actors, as reflected by the expanding resort to external network arrangements (Dyer and Singh, 1998). Such networks may be differently defined according to the relational (either business or social) and governance (alliances, industry network, clusters, etc.) boundaries adopted. Among those external organizational strategies, strategic alliances involving MNEs have witnessed a boom in the last decades. This chapter surveys MNEs’ competitive strategy research. The discussion is split into three main sections. The...
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