Japanese multinationals in the post-bubble era: new challenges and evolving capabilities

Abstract

Since the bursting of Japan's bubble economy, from 1990 onwards, Japanese multinational companies (MNCs) have faced new competitive challenges and questions about the management practices on which they had built their initial success in global markets. Japanese engagement in the international economy has undergone a number of phases. In the period before the Second World War, Japanese companies learnt from foreign MNCs in trading, shipping, and manufacturing, frequently through strategic alliances, and leveraged their capabilities to succeed in overseas and largely Asian markets. In the immediate post-war decades, during the Japanese 'economic miracle', there were notable examples of MNC investment in raw materials and labour intensive production, but both inward and outward foreign direct investment were not significant. Japanese companies achieved leadership in management and technology, in order to support a strategy of export-orientated industrialization. Changes in government policies in the developed economies of the US and Western Europe forced leading Japanese manufacturers to convert themselves into MNCs and to transfer their home-grown capabilities to overseas subsidiaries. The period after 1990 marked declining Japanese competitiveness and it asked questions about the ability of Japanese MNCs to be more responsive and global in their strategies, organization and capabilities.

Is there an East Asian model of MNC internationalization? A comparative analysis of Japanese and Korean firms

“…When we cite from these data (Table 2), we use the term MNC. In order to promote consistency across this APBR Special Issue, we echo Bartlett and Ghoshal (1991) and subsequently Fitzgerald and Rowley (2015) by defining 'MNCs' as firms that choose to invest substantially and locate large-scale business activities in both 'familiar' and 'less familiar' countries and regions while simultaneously maintaining majority ownership and strategic control of these investments and the returns they are designed to generate.…”

“…With this paper, we attempt to connect with (in East Asian contexts) well-established and growing streams of more diversified and less 'Westernized' research (Kojima 1978;Peng and Khoury 2009;Ping, Plechero, and Basant 2013;Fitzgerald and Rowley 2015). Specifically, we attempt to query the validity of what we suggest represent markedly 'Western' models of MNC internationalization in a new era of global flows of FDI, increasing amounts of which are sourced in East Asia.…”

“…Griffiths 2012). From the foreign MNC perspective, managing changes in the firm's internal structure is vital: for example, sustained investment in foresighted innovation and patent protection combined with staffing and training strategies adjusted to local human resource availability and consumer expectations (Fitzgerald and Rowley 2015).…”

The degree of internationalization of Chinese Multinationals along the belt and road initiative countries

“…The multinational firm is also one that engages in value addition activities across borders [10] as well as one that organizes the linkages between employees located in more than one country through employment contracts [52]. At the same time, Fitzgerald & Rowley [74] define it as a firm that has significant investments and large scale business activities in different countries while maintaining ownership and control. Considering these attributes of multinationals, our definition is not as weighted towards the proportion of foreign sales as an indicator of multi-nationality a la Rugman.…”