Leveraging the recent research interest in emerging economies, this Perspective paper argues that an institution-based view of international business (IB) strategy has emerged. It is positioned as one leg that helps sustain the “strategy tripod” (the other two legs consisting of the industry- and resource-based views). We then review four diverse areas of substantive research: (1) antidumping as entry barriers; (2) competing in and out of India; (3) growing the firm in China; and (4) governing the corporation in emerging economies. Overall, we argue that an institution-based view of IB strategy, in combination with industry- and resource-based views, will not only help sustain a strategy tripod, but also shed significant light on the most fundamental questions confronting IB, such as “What drives firm strategy and performance in IB?”

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An institution-based view of international business strategy: a focus on emerging economies

Winning Through Innovation: A Practical Guide to Leading Organizational Change and Renewal Tushman, Michael L. and O'Reilly, Charles A., 256 pp., Cambridge, MA: Harvard Business School Press, 1997. Reviewed by Subodh P. Kulkarni, Assistant Professor in School of Business at Howard University, Washington, D.C. Professors Tushman and O'Reilly are well known for their research on innovation and organizational culture. In this book, the authors address a fundamental and interesting issue underlying organizational change and innovation: that of how firms can achieve a balance between stability and change. Businesses are not likely to prosper or survive in the long run without this balance. One of the book's key premises is that short-term success may constrain a firm's ability to change. Short term successes often occur in larger, older, more structured organizations, the source of structural and cultural inertia, which yields success in stable environments and failure when environments change. Therefore, a company's culture holds the key to success (or failure) in the long run. To create and sustain a competitive edge in the long run, companies must learn how to manage incremental and revolutionary change. The key, according to the authors, is to develop an "ambidextrous organization." Tushman and O'Reilly define ambidextrous organizations as those having internally consistent structures and an internal operating culture that provides for excelling today, while also planning for the future. The ambidextrous organizations are, thus, engaged in a balancing act between the management of incremental and revolutionary technologies. Further, these organizations have very different cultures within a company (or even a business unit, for that matter). Vision is vital to ambidextrous organizations, often displaying one vision that hosts multiple cultures in the unit. Of course, a firm can have multiple cultures under one roof by spinning off different business units and managing them independently. This is unacceptable to the authors. It is important to manage them as a whole, or as a system. The thing that holds the system components together is the overarching vision for the technology firm. That is why the book emphasizes strategic intent or competitive vision; because without a common, overarching purpose and set of values, the ambidextrous company just does not hold together. So it is not only different cultures, but different structures, systems, rewards, and competencies that need to be managed together. Drawing on their extensive research, consulting practice, as well as the experiences of managers from several "ambidextrous companies," the authors develop a model that can be used by executives to understand the dynamics of change necessary for long-term success. Toward this end, the book provides several tools for identifying and diagnosing the causes of performance gaps and for developing action plans to attain, and maintain, industry leadership. The book is divided into nine chapters. Chapter 1 is introductory, and it outlines the concepts underlying the authors' model. Chapter 2 highlights the significance of the concepts introduced earlier in the context of global change and innovation. Chapters 3 through 6 focus on the building of capabilities, competencies, and cultures that can generate a sustainable competitive advantage. Chapter 4 develops a model that highlights the congruence among an organization's strategies and four distinct factors: critical tasks, culture, structure, and people. A lack of congruence often results in performance gaps. Chapter 5 outlines how organizational culture-the selecting, socializing, and rewarding of workers consistent with the company's goals-promotes this congruence. It also illustrates how to assesses an organization's culture. Chapters 7 and 8 stand out in particular because in these chapters the authors introduce techniques for building an ambidextrous organization. …

Winning through Innovation: A Practical Guide to Leading Organizational Change and Renewal

The internationalization of new ventures from emerging economies to developed economies remains an unfilled gap at the intersection of the literature between international entrepreneurship and stra...

What Drives New Ventures to Internationalize from Emerging to Developed Economies

We develop a real options perspective to explore how an entrepreneur-friendly bankruptcy law can encourage entrepreneurship development at the societal level. If bankrupt entrepreneurs are excessively punished for failure, they may let inherently high-risk but potentially high-return opportunities pass. We suggest that a more entrepreneur-friendly bankruptcy law, informed by a real options logic, can encourage more active and vibrant entrepreneurship development. We also discuss the implications of the role of venture capital and stigma in the effectiveness of an entrepreneur-friendly bankruptcy law.

Bankruptcy Law and Entrepreneurship Development: A Real Options Perspective

The current study, while examining the fields of psychological empowerment, work engagement and innovation, found that psychological empowerment affected work engagement and led to high innovation and lower turnover intention. Psychological empowerment was found to have strong predictive power on work engagement and innovation. The sample respondents were 291 managers from the Indian industrial sectors of pharmaceutical, heavy engineering, IT, electronics and aeronautics engineering. Results of structural equation model revealed work engagement as a strong mediator between psychological empowerment and innovation. The current study provides strong empirical relationship among constructs of psychological empowerment, work engagement, innovation and turnover intention. The theoretical implications to multi-level research are drawn in the study and practical implications are discussed.

Management of innovation: role of psychological empowerment, work engagement and turnover intention in the Indian context

Private firms in transition economies are operating in an extremely uncertain environment, with underdeveloped market institutions, poorly defined property rights, and absence of reliable business data. This raises a very basic question of how owners of these firms persuade bankers to make much needed loans. This study employs an institutional perspective and argues that firms' legitimacy positively influences their accessibility to bank financing. Specifically, this study develops a model that links networking, professional management practices, and growth stage with bank financing and tests that model using a sample of Vietnamese private firms. The results support the hypotheses that growth stage and networking greatly influence firms' accessibility to bank financing, and that the impact of networking on financing is contingent on the growth stage.

Getting bank financing: A study of Vietnamese private firms

This paper portrays an empirically grounded theory research on the impact of organizational culture on technological innovation adoption in 8 private hospitals in Vietnam. It identifies the dimensions of organizational culture underlying technological innovation adoption, namely cause vision, organizational structure compound, support mechanisms, and innovation stimulators, as well as highlights the fashion in which these dimensions operate will either activate or inhibit technological innovation.

https://ccsenet.org/journal/index.php/ibr/article/download/5614/6864

Organizational culture and technological innovation adoption in private hospitals

Purpose – Adopting a view that migration is an investment, the purpose of this paper is to investigate the risk-adjusted returns that migrant domestic workers from Vietnam to Taiwan can expect to earn. Design/methodology/approach – The study analyses data obtained through interviews of a sample of migrant domestic workers, all from Phu Tho in the north of Vietnam, who had migrated to Taiwan. Findings – The study found that migrants were driven strongly by financial motivations. Analysis of the typical costs of migrating, wages in the host country, average length of stay and especially, uncertainties affecting the length of stay, found that the investment in migration is a highly risky one for migrants. In most cases, migration does not pay. Research limitations/implications – Estimates of costs and benefits can be improved with larger samples of respondents and data sources that can help validate the interviews. Practical implications – There is a need to improve financial literacy among migrants to help ...

Does migration make financial sense? The case of domestic workers from Vietnam to Taiwan

This article is an attempt to open the lid a little of the “black box of migration” i.e. brokers. Analysing contracts between brokers and labour migrants, we identify four different forms of exploitation of migrants by brokers: expropriation of skill premium, risk shifting, over-charging, and non-refund of deposits. Opportunistic behaviour by brokers, as evidenced by such exploitation, is seen as a market failure that is explained by human attributes and transactional characteristics. Given the rigidities in the human attributes of the contracting parties and the nature of migration as a risky multi-period transaction, proposals are made for non-market interventions, which can lead to more equitable contracting.

Does “buyer beware” work in migration? Contracting between brokers and migrants in Vietnam

Studies on industrial clustering identify factors that nourish the clustering and thus aid in industrial development. We classify these as government incentives and economic fundamentals. Economic fundamentals, which we define as a set of essential factors conducive to the development of an industry cluster, may be the result of chance — for instance, geographical location and climate — or may be a result of long term government policies such as affordable and abundant higher education. We examine the importance of government incentives relative to the economic fundamentals in the development of the software services industry in Thailand. Our survey of investors, both foreign and domestic, in the software services industry in Thailand, found that economic fundamentals were perceived as being more important than government incentives in influencing investment decisions. This raises important questions for government policy. For example, is money used for tax breaks and grants efficiently spent? Or, could the money be better invested in improving the quality of human resources and infrastructure? Based on the findings of this study, recommendations are proposed for government policy and directions for future research.

Sundar Venkatesh

Papers

Getting bank financing: A study of Vietnamese private firms

Organizational culture and technological innovation adoption in private hospitals

Does migration make financial sense? The case of domestic workers from Vietnam to Taiwan

Does “buyer beware” work in migration? Contracting between brokers and migrants in Vietnam

The Importance of Government Incentives Relative to Economic Fundamentals: The Case of Software Industry in Thailand