AIB 2012 Conference Proceedings - Academy of International ...

SUNDAY
Session: 1.5.5 - Competitive
Track: 5 - MNC Management and Organization
New Perspectives on MNE Strategy and Performance
Presented On: July 1, 2012 - 16:15-17:30
Chair: Elizabeth L. Rose, Aalto University School of Economics
The Circular Relationship between Geographical and Product Diversification in Spanish MNEs
Diana Benito-Osorio, Rey Juan Carlos University
Alfredo Jimenez, University of Burgos
Nowadays, the number of multinational enterprises that are pursuing product diversification strategies is
increasing. Drawing on the Resource Based View of the Firm, the aim of this paper is to advance one step
further, by investigating these strategies through the analysis of a circular relationship between product and
geographical diversification. The results, obtained from a sample of the most relevant Spanish multinational
firms, suggest that their adaptation to a wide range of different countries hinders the necessary coordination of
activities that related product diversification requires and vice-versa. On the contrary, unrelated diversification
strategies can provide financial synergies, experience and flexibility, which help the process of
internationalization. Simultaneously, a higher geographical diversification allows each division to behave as an
independent unit and to develop more efficient internal control systems and resource allocation. (For more
information, please contact: Alfredo Jimenez, University of Burgos, Spain: ajimenez@ubu.es)
Diverse Strategies of Resource Commitment Development among Service Firms during Internationalization: A
Dynamic Capabilities Perspective
Abhishek Shukla, Charles Darwin University
This study addresses the lack of research on the development of resource commitment after the initial entry in
a new international market. Two aspects from the dynamic capabilities view, namely building and
reconfiguration of resource commitment by service firms in a host market were investigated. Service firms were
classified based on their asset intensity and were split into knowledge intensive services and capital intensive
services. It is proposed that these two types of services exhibit different patterns in the pace of resource
commitment build up and also in the type of reconfiguration adopted. A quantitative longitudinal research
design is used to empirically test these two aspects of dynamic capabilities. Results indicate that knowledge
intensive services build their resource commitment at almost twice the pace of capital intensive services. Also,
knowledge intensive services reconfigure their resource commitment in small increments which is in contrast to
the radical changes preferred by capital intensive services. (For more information, please contact: Abhishek
Shukla, Charles Darwin University, Australia: abhishek.shukla@cdu.edu.au)
Host Country Location, Subsidiary-Level Firm-Specific Advantages, and Subsidiary Performance in South East
Asia
Quyen T.K Nguyen, University of Reading
Alan M. Rugman, University of Reading
We examine the relationship of host country specific advantages (CSAs) in terms of market attractiveness,
subsidiary-level firm specific advantages (FSAs), subsidiary sales strategy and asset exploitation FDI motives as
they affect subsidiary performance. From a sample of 101 British MNE subsidiaries in six S.E Asian countries
over five-year period (2003-2007), our analysis reveals three significant findings. First, host country market
attractiveness and subsidiary-level FSAs can be operationalized as multi-item constructs. Second, host country
market attractiveness, export sales by a subsidiary, asset exploitation FDI motives, general management
AIB 2012 Conference Proceedings
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