Table 1 - uploaded by Robert Hassink
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One of the most significant changes in the global economy today is the strong increase in outgoing foreign direct investment (OFDI) from emerging economies to industrialised countries. Whereas investment in less developed countries is often motivated by the sourcing of natural resources and cheap labour, knowledge and technology-seeking is an incre...
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Citations
... For internalisation motives, EMFs may internationalise for various reasons, which are usually a mix of both internal and external factors (Ahmad, 2014). Luo et al. (2010) and Dohse et al. (2012) observed that market-seeking is a key motive behind EMF internationalisation. For Indian firms, internationalisation motives include gaining access to advanced technology, value creation for their brands and pursuit of customers for niche products (UNCTAD, 2006;Gubbi et al., 2010). ...
Purpose
This study aims to explore the internationalisation paths and strategies adopted by firms from an emerging market and serves as a step towards examining the suitability of prevailing internationalisation theories in the context of emerging market firms.
Design/methodology/approach
This study adopted a qualitative methodology and gathered data through in-depth semi-structured interviews with 15 top managers of internationalised firms from the East Malaysian state of Sarawak. Data were analysed thematically.
Findings
The results revealed that the internationalisation strategies of firms from Sarawak can be classified under three main categories: motivations and markets, modes and measures. The constraints the firms faced were important determinants of their internationalisation strategies. The internationalisation paths and strategies of the firms were also found to exhibit both similarities to and deviations from the tenets of prevailing internationalisation theories.
Originality/value
The study contributes knowledge to the literature of both internationalisation theories and internationalisation strategies of emerging markets, in particular, it advances Fey et al.’s (2016) Five M Framework.
... Moreover, Dau (2013) shows that developing-country MNEs' profitability benefits more from the pro-market reforms in their domestic markets by making OFDI in advanced countries than in developing countries. Overall, scholars recognize that the market environments in more advanced countries provide EMNEs with greater opportunities to acquire valuable knowledge (Dohse et al., 2012), but meanwhile require stronger capabilities to survive the tougher competition (Ramamurti & Singh, 2009). Such a trade-off between the opportunity and the threat helps reveal EMNEs' different motivations and capabilities of making upward versus downward OFDI. ...
... First, the learning from IFDI enhances EMNEs' competitiveness in the global markets, thereby making upward OFDI more achievable for EMNEs. As noted above, upward OFDI provides greater opportunities for seeking valuable resources and strategic assets, which represents strong pulling forces for EMNEs (Dau, 2013;Dohse et al., 2012;Luo & Tung, 2007). However, upward OFDI also means tougher competition with more advanced local rivals (Deng et al., 2018;Ramamurti & Singh, 2009), thereby highlighting the importance of EMNEs' stronger competitiveness to enter and survive in such host markets. ...
... First, IFDI provides more opportunities for EMNEs to learn about foreign MNEs' experience of local adaptation, which helps the EMNEs to better leverage their competitive advantages over local rivals in less developed host markets. Whereas upward OFDI typically attracts EMNEs by the chance to obtain strategic assets (Luo & Tung, 2007), downward OFDI usually provides EMNEs with access to cheaper production factors, such as labor, land, and raw materials, to reduce costs (Dau, 2013;Dohse et al., 2012). Meanwhile, distinct from more advanced host markets that require stronger competitiveness to survive the tougher competition, EMNEs are more likely to own competitive advantages in terms of technology and management practice over the typically inferior local rivals in less advanced host markets. ...
Inward foreign direct investment (IFDI) carries critical implications for emerging market multinational enterprises’ (EMNEs’) outward foreign direct investment (OFDI). While extant research provides evidence for the positive linkage between IFDI and EMNEs’ OFDI, less is known about the directionality of such OFDI— where to go . This study aims to extend the IFDI-OFDI linkage by differentiating EMNEs’ upward and downward OFDI (i.e., OFDI projects in more and less advanced host countries than their home markets). Using panel data on 1334 Chinese multinationals, I find that IFDI promotes EMNEs’ upward OFDI, but this effect is weakened by state ownership and industry competition. Moreover, my findings show that although IFDI is not related to EMNEs’ downward OFDI in general, their linkage becomes positive in the conditions of higher state ownership or weaker industry competition. This study advances our understanding of the directionality (i.e., where to go ) of EMNEs’ OFDI in the face of IFDI spillovers.
... This highly dynamic, competitive environment of emerging companies operating in emerging economies has prompted considerable attention from scholars and practitioners. In addition, the increasing global presence of EMNCs has encouraged many scholars to study them and define their characteristics and strategies for internationalization (Contractor, 2013;Dohse et al., 2012). In response to this interest, two companies were selected from the airline industry, and Mutlu et al.'s (2015) competitive dynamics framework was applied to provide practical evidence of the competitive dynamics and co-evolution of MNCs and EMNCs in emerging economies. ...
Multinational Companies from Emerging Economies (EMNCs) have become key players in the global economy. EMNCs have started to operate in highly dynamic, competitive environments where they are faced with competition from multinational companies (MNCs) from developed economies. This study applied awareness–motivation–capability (AMC) framework to the airline industry to investigate how EMNCs outperform MNCs. The development of each round of Mutlu et al.’s framework was tested using secondary data sources that cover 16 years, from 2001 to 2016. A fourth round, relating to the determination of ‘who will be the market leader’, was added to the framework and tested. The findings demonstrate that firms’ awareness and capabilities evolve in each round to develop the competitive advantages required to enhance their market position. The complex nature of competition requires firms to analyse …
... This also leads to proposing special issues and volumes dedicated to the study of EMNCs and their development stages (Cuervo-Cazurra, 2012;Cuervo-Cazurra and Ramamurti, 2014;Luo and Tung, 2007;Ramamurti and Singh, 2009). Increasing the global presence of EMNCs has encouraged many scholars to pay more attention to studying them and defining their characteristics and strategies (Buckley et al., 2016;Contractor, 2013;Dohse et al., 2012). Accordingly, a few studies started to consider the influence of home country on EMNCs' innovations and global expansion (Cuervo-Cazurra, 2006;Cuervo-Cazurra and Genc, 2008;del Sol and Kogan, 2007;Govindarajan and Ramamurti, 2011;Luo and Wang, 2012). ...
This research explores home country influence on successful internationalization of emerging multinational companies. We considered Qatar Airways and Emirates Airways as two companies from different countries with similar economic structures. Interviews of five experts in the airline industry revealed that four home country factors have produced significant competitive advantages, allowing both carriers to rapidly internationalize their activities and become key players in the global aviation industry. These home country factors are the location of the country, rapid economic development, government support, and influence of related industries.
... This also leads to proposing special issues and volumes dedicated to the study of EMNCs and their development stages (Cuervo-Cazurra, 2012;Cuervo-Cazurra and Ramamurti, 2014;Luo and Tung, 2007;Ramamurti and Singh, 2009). Increasing the global presence of EMNCs has encouraged many scholars to pay more attention to studying them and defining their characteristics and strategies (Buckley et al., 2016;Contractor, 2013;Dohse et al., 2012). Accordingly, a few studies started to consider the influence of home country on EMNCs' innovations and global expansion (Cuervo-Cazurra, 2006;Cuervo-Cazurra and Genc, 2008;del Sol and Kogan, 2007;Govindarajan and Ramamurti, 2011;Luo and Wang, 2012). ...
... Moreover, they often have access to cheap state finance, and many of them are family-controlled, which makes more comfortable to make a decision (Dohse, Hassink, & Klaerding, 2012), or business 11 groups and state-owned companies (SOEs), thus reducing transaction costs (Becker-Ritterspach & Bruche, 2012). However, they are generally characterized by low-income, rapid-growth countries with fragile market institutions, lack of well-developed labor and capital markets, corruption, and excessive bureaucracy (Hoskisson et al., 2000;Peng et al., 2008;Schoen, 2009;Parente et al., 2013). ...
Institutions may influence coopetition in different levels in each industry depending on the drivers, dynamics, outcomes and context involved. This study goes beyond past research by examining the mediate role that coopetition plays regarding the impact of adherence to formal institutions (in the home country) ant the international performance of firms. Using data collected from 166 firms of winery, footwear and IT industries, we proposed and found that formal institutions and coopetition positively influence international performance of firms from an emerging economy. This study also advances the literature by proposing a measure of a coopetition that encompasses cooperation in a market (domestic) and competition in another (international arena).
... Normally, they are pioneers of several local industries because emerging countries have large populations and increasing incomes (Berrill & Manella, 2013). Moreover, they often have access to cheap state finance and many of them are family-controlled, which makes easier to decide (Dohse et al., 2012), or are business groups and state-owned firms (SOEs), thus reducing transaction costs (Becker-Ritterspach & Bruche, 2012). ...
The study of the internationalization of family businesses has grown significantly in the last decades. However, there is no specific literature on this topic and its relationships with the transgenerational aspects of family businesses from emerging countries. Thus, this article aims to investigate the level of relevance of the internationalization to the transgenerational continuity of family businesses beyond the second generation. A case study was carried out with a third-generation family business in Southern Brazil. We conducted this research based on the
... Normally, the family businesses in these markets are pioneers of several local industries because emerging countries have large populations and increasing incomes, since large and rapidly growing domestic markets give them scale and cash to invest abroad (Berrill & Manella, 2013). Moreover, they often have access to cheap state finance and many of them are family-controlled, which makes easier to make a decision (Dohse, Hassink, & Klaerding, 2012), or business groups and state-owned firms (SOEs), thus reducing transaction costs (Becker-Ritterspach & Bruche, 2012). ...
The study of the internationalization of family businesses has grown significantly in the last decades. However, there is no specific literature on the topic internationalization as well as on its relationships with the transgenerational aspects of family businesses from emerging countries. Thus, this article aims to investigate the level of relevance of the internationalization to the transgenerational continuity of family businesses beyond the second generation. To answer this question, a case study was carried out with a third-generation family business in Southern Brazil. Moreover, we conducted this research based on the Integrated Model for Internationalization of the Family Business, developed by Centeno-Caffarena and Bocatto (2006). The main conclusion is that internationalization can be an element of the revitalization of the business, thus avoiding its decline. It is necessary that at least some of the members take on the responsibility for continuing the founder's legacy, communicating clearly with the other family members who are not involved in the management to establish a dynamic of respect and trust among all shareholders and heirs.
... Furthermore, emerging countries are desired markets because of the large populations and increasing incomes, since large and rapidly growing domestic markets give them scale and cash to invest abroad (Berrill & Manella, 2013). Moreover, they often have access to cheap state finance and many of them are family-controlled, which makes easier to make a decision (Dohse, Hassink, & Klaerding, 2012), or business groups and state-owned companies (SOEs), thus reducing transaction costs (Becker-Ritterspach & Bruche, 2012). However, they are generally characterized by fragile market institutions, lack of welldeveloped labor and capital markets, corruption, and excessive bureaucracy (Peng et al., 2008;Schoen, 2009;Parente, Cyrino, Spohr, & de Vasconcelos, 2013). ...
This study aims to understand the differences between family businesses participating in emerging and industrialized markets, noting their similarities and their differences in relation to three elements: export levels, perception of governmental support and appreciation from the government with this type of organization. The data presented by PwC Family Business Survey 2012 was used as source of information. The main contribution of this study is to present a panorama consolidating the complexity between family businesses in emerging countries and developed countries, while considering the influence of the institutions with the international business context. The influence of the family business on the internationalization process are still sparse as well as the effects of the international exposure on the family business. In this context, we observed how the institutions play a role in the decision of the family business regarding the internationalization process. On the other hand, we realize that there is the request not only to support but also to change inheritance tax rules in the path to reduce fees and taxes. The last factor analyzed in this study points out that there is a perception of value from the governments of emerging and developed countries for some cases of family businesses. This perception of value can occur due to the history of development of the family businesses, where the government support is clearer in the initial phase of consolidation of those organizations.
... This highly dynamic, competitive environment of emerging companies operating in emerging economies has prompted considerable attention from scholars and practitioners. In addition, the increasing global presence of EMNCs has encouraged many scholars to study them and define their characteristics and strategies for internationalization (Contractor, 2013;Dohse et al., 2012). In response to this interest, two companies were selected from the airline industry, and Mutlu et al.'s (2015) competitive dynamics framework was applied to provide practical evidence of the competitive dynamics and co-evolution of MNCs and EMNCs in emerging economies. ...
