Can Globalisation and Global Localisation Explain Foreign Direct Investment? Japanese Firms in Europe

Seyf, Ahmad

doi:10.1080/13571510151075350

Cited by 10 publications

(5 citation statements)

References 39 publications

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“…underneath of these four types of FDI motives (see Dunning, 2000). Depending on country-level macro variables, FDI motives can also be classified as pull factors like trade barriers, low labor and raw materials costs, market size and favorable government policies (Kumar and Kim, 1984;Chernotsky, 1987), and push factors (Bulatov, 1998;Seyf, 2001) such as political instability, labor unrest and unfavorable taxation at home country (Arpan et al, 1981;Ajami and Ricks, 1981). In this study, we will focus on the effect of push factors in understanding and explaining Turkish manufacturing firms' (TMFs) internationalization process.…”

Section: Literature Review and Development Of Hypothesesmentioning

confidence: 99%

Firm‐specific capabilities and foreign direct investment activities of Turkish manufacturing firms

Kaya

Erden

2008

Journal of Management Development

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The purpose of this paper is to empirically investigate the influence of the home country's unfavorable business environment on the internationalization of Turkish manufacturing firms (TMFs) via FDI. This study uses cross-sectional survey data from a sample 94 TMFs that have equity investment in 28 countries since the mid 1980s. The research results indicate that utility costs, unstable exchange rates, high inflation rate and political instability are considered to be the most important push motives of TMFs. While the relative importance of push motives (i.e., unfavorable business environment) vary with respect to the sampled firm's ages and, to some extent, their sizes; the motives do not vary based on TMFs' subsector.

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Section: Literature Review and Development Of Hypothesesmentioning

confidence: 99%

Firm‐specific capabilities and foreign direct investment activities of Turkish manufacturing firms

Kaya

Erden

2008

Journal of Management Development

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“…Third, we identify the effects on internationalization decisions of the institutional environment in geographic regions and the effects of a country's institutional profile relative to other countries' profiles in the same region. Although research exists on specific regions and on effects of particular institutions (e.g., Oxelheim and Ghauri, ; Schiavo, ; Seyf, ), little is known about how an MNE considers the attractiveness of a region and of countries within it. Finally, we further compare the traditional country‐level institutional approach with the region‐ and country‐level semiglobalized model to understand which provides a better understanding of the institutional environment's influence on MNEs' foreign market investment decisions.…”

Section: Introductionmentioning

confidence: 99%

Do regions matter? An integrated institutional and semiglobalization perspective on the internationalization of MNEs

Arrègle

Miller

Hitt

et al. 2013

Strategic Management Journal

173

150

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Traditional research suggests a relationship between country‐level institutions and the location choices of MNEs. However, more recent theory suggests MNEs also focus on regions (semiglobalization). Therefore, this study examines institutional effects in the context of semiglobalization by considering the influences of three formal institutions (i.e., regulatory control, political democracy, capital investments) of countries and geographic regions on MNEs' location choices of internationalization. We use a sample of Japanese MNEs operating in 45 countries within eight regions. The results show that their degree of internationalization into a country is influenced by both country and regional institutional environments. Additionally, a semiglobalization perspective provides better explanatory power than does the country‐level perspective. These results present a new perspective on how MNEs consider institutional environments in their international strategy. Copyright © 2013 John Wiley & Sons, Ltd.

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“…Several researchers have addressed the nature and scope of international companies' localization strategies (Seyf, 2001; Ramarapu et al , 1999; Bartlett and Ghoshal, 1990). It has been argued that companies should emphasize localization strategies because adaptation to local norms is essential for the success of a new subsidiary (Lee and Chen, 2003).…”

Section: Introductionmentioning

confidence: 99%

Value‐based localization strategies of automobile subsidiaries in Thailand

Johri

Petison

2008

International Journal of Emerging Markets

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PurposeTo analyse the scope of localization strategies and corresponding benefits of these strategies to subsidiaries of international companies in the automobile industry in Thailand.Design/methodology/approachThe authors have adopted the case research method to investigate localization strategies of subsidiaries of seven companies (Toyota, Hino, Honda, Isuzu, DaimlerChrysler, BMW, and Auto Alliance) as well as 14 of their dealers and suppliers in Thailand. The information was gathered by conducting in‐depth multiple interviews with 120 local and expatriate employees at various levels in the organizations; by referring to annual reports, policy documents and internal reports of these companies; and by observation during plant visits.FindingsContrary to the belief that international companies implement localization strategies to simply match the local market environment, it was found that these companies implement a wide range of localization strategies to achieve multiple benefits. The paper identifies nine areas of localization: localization of strategic decision making; building and exploiting the local knowledge pool; deployment of local human resources; localization of R&D; localization of products; use of local supplier networks; adaptations to manufacturing processes; local deployment of subsidiary profits; and localization of corporate image. These localization strategies are not just based on the principle of “cost‐based localization” but are based on “value‐based localization.” These strategies work in tandem and create value through a system of multiple benefits, such as managements' ability to comprehend and deal with uncertainty in the operating environment; make informed decisions to respond to challenges in developing efficient local assembly and marketing systems; cost reduction; higher degree of commitments by local employees; product customization and acceptance; and greater brand equity and image as a good corporate citizen.Practical implicationsBased on concrete illustrations of seven companies, this study identifies nine distinct areas for planning and implementing localization strategies and their corresponding benefits. The managers of subsidiaries can benefit by focusing their localization efforts in these areas to gain maximum advantage from host country context and then translate these advantages into a competitive international strategy.Originality/valueCEOs of subsidiaries in emerging markets can learn how to build and harness local advantages for global competitiveness by implementing a wide range of localization strategies.

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Can Globalisation and Global Localisation Explain Foreign Direct Investment? Japanese Firms in Europe

Cited by 10 publications

References 39 publications

Firm‐specific capabilities and foreign direct investment activities of Turkish manufacturing firms

Firm‐specific capabilities and foreign direct investment activities of Turkish manufacturing firms

Do regions matter? An integrated institutional and semiglobalization perspective on the internationalization of MNEs

Value‐based localization strategies of automobile subsidiaries in Thailand

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