International diversification and firm performance: a four-stage model

Abstract

Purpose The purpose of this paper is to investigate the relationship between international diversification (ID) and performance in multinational firms by proposing a new and unified theory of multinationality that incorporates, integrates and extends previous concepts and hypotheses. Design/methodology/approach The study relies on data concerning the world’s largest companies, derived from the Fortune Global 500. An OLS regression analysis has been carried out in order to test a four-stage relationship between ID and performance. Findings On a final sample of 391 multinationals, this paper provides an empirical evidence that support the existence of a four-stage theory by using a relevant sample of “top” multinational firms. Research limitations/implications This study has two main limitations: first, a single indicator was used to measure ID; second, some potential variables have had to be excluded due to data availability. Practical implications This paper offers some intriguing practical implications, as well: first, it points out to some thresholds where performances are higher at certain level of ID; second, it highlights that performance will face two kinds of decreases due to intra-regional and inter-regional liability of foreignness; finally, it individuates differences with regard to some firms’ characteristics such as home or host country’s behaviors and about the kind of industries in which they operate, as well. Originality/value This is one of the first studies that tests and finds positive evidences about a four-stage theory, regarding to the relationship between ID and performance. Moreover, it proposes other interesting results with regard to the differences between home vs host country-oriented firms and between manufacturing vs services multinational firms.

Knowledge-driven preferences in informal inbound open innovation modes. An explorative view on small to medium enterprises

“…Therefore, some evidence exists of an overall good open approach to innovation in knowledgeintensive industries (Parida et al, 2009;Malerba, 2010;McKelvey and Lassen, 2013; Hirsch-J o u r n a l o f K n o w l e d g e M a n a g e m e n t Kreinsen and Schwinge, 2014;Audretsch et al, 2016;Del Giudice et al, 2016;Scuotto et al, 2016b).…”

“…The first factor that can influence the effectiveness of knowledge is the cognitive dimension of the people within the organization, which is the mental model influenced by people's beliefs, values (Nonaka and Takeuchi, 1995) as well as by loyalty, motivation and information asymmetry. Thus, it considers the knowledge possessed by people within the organization and an increase in the loyalty, motivation and information asymmetry as the key cognitive dimension, therefore enhancing the likelihood of engaging in both formal and informal OI ties (Hooley et al, 2005;Youndt et al, 1996) resource management seems to be the key driver to exploit and monitor the capacity for recognizing knowledge from customers, suppliers and competitors to improve enterprises' innovativeness (Andries and Czarnitzki, 2014;Del Giudice et al, 2016).…”

“…This country was recognized as being suitable for this research because SMEs account for in the region of 99.9% of the total enterprises in the UK, with an average annual turnover of £1. to be flexible and adopt their internal organization to continual market changes (Del Giudice et al, 2016;Popa et al, 2016;Mina et al, 2014;Mortara and Minshall, 2011;Nieto and Santamaría, 2010). This is because SMEs are likely to be more innovation oriented (Martinez-Conesa et al, 2017; Keskin, 2006;Rhee et al, 2010;Rosenbusch et al, 2011;Salavou and Lioukas, 2003).…”

“…The open innovation literature has addressed the influences of intangible resources (human, technological and knowledge) on SMEs' innovation performance (Hitt et al, 2012). In addition, intangible resources have been recognized as relevant assets in determining informal inbound relationships (Parida et al, 2009;Del Giudice et al, 2016).…”

Comparative Analysis of Mission Statements of Chinese and American Fortune 500 Companies: A Study from the Perspective of Linguistics

“…The companies on the Fortune 500 list, on the other hand, are all major companies with strong human resources and have a more genuine understanding of the values and more critical needs for the development of mission statements. Several studies utilize the Fortune 500 list as a sub-sample of large companies in cross-cultural business and management research [25][26][27][28]. We likewise believed it proper to use companies on the Fortune 500 list as representative samples for our study that focused on cross-country differences in mission statements.…”