Globalization

Globalization is a featured research topic and an initiative at Harvard Business School.
 
The globalization of business has long encouraged Harvard Business School (HBS) faculty to research international business practices and the effects of globalization. Seminal contributions - Christopher Bartlett on managing across borders, Michael Porter on competition in global industries, and Louis Wells on foreign investment in emerging markets - helped pave today’s global research path. Supported by eight Global Research Centers that facilitate our contact with global companies and the collection of international data, HBS faculty continue to shed light on questions that are critical to our understanding of international business and global markets. Informed by detailed company case studies and large-sample empirical investigations, HBS global research yields insights that help inform business practice and public policy.
  1. Governments as Owners: State Owned Multinational Companies

    The globalization of state-owned multinational companies (SOMNCs) has become an important phenomenon in international business (IB), yet it has received scant attention in the literature. We explain how the analysis of SOMNCs can help advance the literature by extending our understanding of state-owned firms (SOEs) and multinational companies (MNCs) in at least two ways. First, we cross-fertilize the IB and SOEs literatures in their analysis of foreign investment behavior and introduce two arguments: the extraterritoriality argument, which helps explain how the MNC dimension of SOMNCs extends the SOE literature, and the non-business internationalization argument, which helps explain how the SOE dimension of SOMNCs extends the MNC literature. Second, we analyze how the study of SOMNCs can help develop new insights of theories of firm behavior. In this respect, we introduce five arguments: the triple agency conflict argument in agency theory; the owner risk argument in transaction costs economics; the advantage and disadvantage of ownership argument in the resource-based view (RBV); the power escape argument in resource dependence theory; and the illegitimate ownership argument in neoinstitutional theory. After our analysis, we introduce the papers in the special issue that, collectively, reflect diverse and sophisticated research interest in the topic of SOMNCs.

    Keywords: multinational corporation; state-owned enterprises; State capitalism; FDI; internationalization; government and business; national oil companies; State Ownership; Multinational Firms and Management; Business Subsidiaries; Acquisition; Pharmaceutical Industry; Energy Industry; China; India; Europe;

    Citation:

    Musacchio, Aldo, Alvaro Cuervo-Cazurra, Kannan Ramswamy, and Andrew Inkpen. "Governments as Owners: State Owned Multinational Companies." Special Issue on Governments as Owners: Globalizing State-Owned Multinational Enterprises edited by Alvaro Cuervo-Cazurra, Andrew Inkpen, Aldo Musacchio and Kannan Ramaswamy. Journal of International Business Studies 45, no. 8 (October–November 2014). View Details
  2. International Strategy: Context, Concepts and Implications

    This book is designed for every student who will be involved in managing and advising companies that compete internationally or face international competitors. Designed around the course at Harvard Business School, Collis' new text takes the firm that operates across borders as a unit of analysis and the senior manager in a multinational as the typical decision maker. Illustrated with examples from companies of all sizes from around the globe, this text provides students with the means to navigate their way through the decisions they will face and formulate an effective business strategy. This is a much-needed guide to the common strategic issues that arise when firms compete internationally.

    Keywords: Cross-Cultural and Cross-Border Issues; Global Strategy; Globalized Economies and Regions; Globalized Firms and Management; Multinational Firms and Management; Globalized Markets and Industries; Alignment; Business Strategy; Competitive Strategy; Competitive Advantage; Corporate Strategy; Diversification; Horizontal Integration; Vertical Integration;

    Citation:

    Collis, David J. International Strategy: Context, Concepts and Implications. Chichester, UK: John Wiley & Sons, 2014. View Details
  3. Doing Business in Morocco

    This case examines the challenges and opportunities of doing business in Morocco. It highlights Morocco's ongoing economic transformation in the decades leading up to 2014 in the context of its historical, political, and cultural background. The case summarizes some of the main obstacles faced by businesses operating in the country—changing regulations and insufficient access to credit, infrastructure and talent constraints, and a large informal sector—contrasting these with the benefits of operating in a market that provides access to the African continent and proximity to Europe, has relatively low labor costs, and has created a series of investment incentives. Some of these challenges are illustrated through the discussion of an investment decision by French car maker Renault, which opened a new manufacturing facility in Morocco's free trade zone near Tangier. Now a few years into operating the facility, the case zooms in on some of the obstacles that Renault encountered, such as scarcity of trained staff and of local suppliers, and on the progress that was made, in order to evaluate the potential of the investment going forward.

    Keywords: emerging market; emerging economies; Africa; business history; strategy; global strategy; operations management; Development Economics; Geographic Scope; Globalization; Business History; Emerging Markets; Market Entry and Exit; Operations; Strategy; Auto Industry; Africa; Morocco;

    Citation:

    Avery, Jill, Tonia Junker, and Daniela Beyersdorfer. "Doing Business in Morocco." Harvard Business School Case 315-007, September 2014. View Details
  4. Business History and the Impact of MNEs on Host Economies

    Business history has long been recognized as providing an important dimension in international business studies. Much of this historical work has focused on mapping historical growth patterns of multinationals and exploring the determinants of their growth. However, there is also growing literature on the long-term impact of multinational investment in host economies, and this chapter reviews this research. The focus is primarily on developing country host economies and more broadly on the global distribution of wealth and poverty. This chapter suggests three major arguments. First, it is necessary to take a long-time horizon when assessing impact on host economies. Second, it is necessary to incorporate societal and cultural impacts alongside more traditional measures of economic impact. Third, there is weak historical evidence that multinationals have had a substantial positive impact over the long run on the development of host developing countries. A hypothesis is suggested that, given adequate domestic growth-supporting institutions and human capital development, developing countries achieve more sustained development from excluding foreign-owned multinationals rather than hosting them.

    Keywords: multinational; international business; business history; culture; Globalization; History; Africa; Asia; Europe; Latin America; North and Central America;

    Citation:

    Jones, Geoffrey. "Business History and the Impact of MNEs on Host Economies." In Multidisciplinary Insights from New AIB Fellows. Vol. 16, edited by Jean J. Boddewyn, 177–198. Research in Global Strategic Management. Bingley, UK: Emerald Group Publishing, 2014. View Details
  5. Hospital for Special Surgery (A)

    Hospital for Special Surgery, a focused factory for orthopedics and joint disease, is contemplating various growth options: further growth in the United Kingdom's National Health Services, management of hospitals in the United States, and/or hospital consulting. Reviews the issues surrounding growth of a nonprofit institution and the United Kingdom's socialized health care system.

    Keywords: Cross-Cultural and Cross-Border Issues; Growth and Development Strategy; Nonprofit Organizations; Expansion; Health Industry; United Kingdom; United States;

    Citation:

    Herzlinger, Regina E. "Hospital for Special Surgery (A)." Harvard Business School Case 315-012, August 2014. View Details
  6. Reinventing Retail: ShopRunner's Network Bet

    ShopRunner considers adjustments to improve its online shopping service which offers no-charge two-day shipping as well as easy returns and other conveniences. Competitors' diverse pricing models and ancillary benefits raise questions about how to structure and price ShopRunner's offering. Meanwhile, an investment from Alibaba presents new opportunities in China but risks distraction from the core business.

    Keywords: shopping club; coop; pricing; shipping; Marketing Channels; Global Strategy; Order Taking and Fulfillment; Information Technology Industry; Retail Industry; United States; China;

    Citation:

    Edelman, Benjamin, and Karen Webster. "Reinventing Retail: ShopRunner's Network Bet." Harvard Business School Case 915-002, August 2014. (request a courtesy copy.) View Details
  7. Supply Chain Screening Without Certification: The Critical Role of Stakeholder Pressure

    To assess and manage reputational risks associated with supply chains, buyers are increasingly seeking information about their suppliers' labor and environmental performance. Several voluntary programs have arisen to encourage suppliers to report this information in a standardized manner, but the information companies report might misrepresent their performance and can thus mislead rather than inform buyers. We hypothesize particular circumstances in which buyers can screen suppliers based on their participation in voluntary programs requiring public commitments and public reporting. In particular, we theorize that stakeholder scrutiny can effectively deter companies with misrepresentative disclosures from participating in such programs, and that this deterrence effect is stronger for smaller companies and in institutional contexts featuring stronger activist pressures and stronger norms of corporate transparency. Examining the decisions of 2,043 firms headquartered in 42 countries of whether to participate in the UN Global Compact, we find support for these hypotheses.

    Keywords: United Nations; Labor standards; Working Conditions; supply chain; supplier relationship; procurement; globalization; governance; sustainability; Sustainability Management; quality; quality and safety; safety; risk; reputation; Globalization; Globalized Markets and Industries; Supply Chain Management; Supply Chain; Corporate Social Responsibility and Impact; Quality; Risk and Uncertainty; Safety;

    Citation:

    Kayser, Susan A., John W. Maxwell, and Michael W. Toffel. "Supply Chain Screening Without Certification: The Critical Role of Stakeholder Pressure." Harvard Business School Working Paper, No. 15-009, August 2014. View Details
  8. Health City Cayman Islands

    Narayana Health (NH) had been successfully delivering affordable high quality tertiary care to the masses in India through its chain of hospitals for over a decade. To encourage the adoption of the NH affordable care delivery model worldwide, Dr. Shetty, Chairman of NH, was keen to establish a hospital in the western hemisphere and believed that it was important to demonstrate the model to the US. Thus when the Cayman Islands Government was interested in developing the island as a medical tourism hub during 2008-09, Dr. Shetty agreed to develop the Health City Cayman Islands (HCCI), a 2,000 bed conglomeration of multiple super-specialty hospitals within a single campus located on Grand Cayman Island. The first phase of HCCI, a 104 bed hospital focused on cardiac care and orthopedics, was developed jointly by NH and Ascension, the largest non-profit hospital system in US. The hospital was inaugurated in February, 2014 but there were open questions related to pricing of the procedures and the related target patient segment and volumes. Also, HCCI senior management realized the need to adapt the NH model developed in and for India to fit the new environment at Cayman and was open to experimentation in the coming months.

    Keywords: healthcare; emerging economies; innovation; india; institutions; pricing; replication; adoption; adaptation; strategy; Narayana Health; Ascension; Health City Cayman Islands; Dr. Devi Shetty; global strategy; international business; Health Care and Treatment; Innovation Strategy; Innovation and Management; Disruptive Innovation; Cross-Cultural and Cross-Border Issues; Global Strategy; Knowledge Use and Leverage; Management Practices and Processes; Growth Management; Growth and Development Strategy; Market Entry and Exit; Adaptation; Adoption; India; Cayman Islands;

    Citation:

    Khanna, Tarun, and Budhaditya Gupta. "Health City Cayman Islands." Harvard Business School Case 714-510, May 2014. View Details
  9. Vaxess Technologies, Inc.

    In February 2014, Michael Schrader, chief executive of Vaxess Technologies, Inc., was assessing the startup health care company's 2014 marketing plan. On December 31st, 2013, Vaxess had obtained an exclusive license to a series of patents for a silk protein technology that, when added to vaccines, reduced or removed the need for refrigeration between manufacturing and delivery to the end patient. Schrader and his colleagues had to decide on which vaccines to focus and whether and how to target the drug companies that manufactured the vaccines or the quasi-government organizations (such as UNICEF and PAHO) and nongovernment organizations (such as GAVI) that purchased large quantities of vaccines for the developing world.

    Keywords: vaccine; cold chain; antigen; temperature controlled; developing markets; immunization; Health Care and Treatment; Health Pandemics; Global Strategy; Supply Chain; Health; Health Industry; Medical Devices and Supplies Industry;

    Citation:

    Quelch, John A., and Margaret L. Rodriguez. "Vaxess Technologies, Inc." Harvard Business School Case 514-107, May 2014. View Details
  10. Right Up the Middle: How Israeli Firms Go Global

    The article considers international business enterprises based in Israel and how they successfully expanded from their origins as small businesses. A common technique of those companies in which they focused on market entry in other countries whose markets were too small to have attracted competition from larger international business enterprises yet were not adequately served by domestic companies is considered. Examples offered include the drip irrigation equipment company Netafim, Teva Pharmaceuticals and computer software industry firm Amdocs.

    Keywords: Globalized Firms and Management; Israel;

    Citation:

    Friedrich, Jonathan, Amit Noam, and Elie Ofek. "Right Up the Middle: How Israeli Firms Go Global." Harvard Business Review 92, no. 5 (May 2014): 113–117. View Details
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