BU491 Chapter 1: Chapter 1
Document Summary
Multinational enterprise (mne): dominant vehicle of internationalization: the key differentiating characteristic of an mne is the importance of both strategic and organizational integration, and active, coordinated management of operations in different countries. Market-seeking behavior: this is strong for companies who have intrinsic advantages, as it gives them an ca in offshore markets. Allows them to exploit economies of scale and scope. Labour, low cost capital, government financial incentives: emerging motivations. Initially, the typical attitude was that the foreign operations were mere strategic and organizational appendages to the domestic business and should be managed opportunistically. Now, the strategy is more integrated and has a worldwide sense. Organizational capabilities: international process: combination of rational analysis, opportunism, and pure luck. Model for internationalization (uppsala: the company makes an initial commitment of resources to the foreign market and gains local market knowledge, it then makes a subsequent resource commitment.