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, key investigations concentrate on the effectiveness of management practices in global organizations; cross-cultural learning and adaptation processes; the challenges of taking companies global; emerging-market companies with global potential; and international political economy and its impact on economic development.

Featured Works

 

  1. Working Paper | HBS Working Paper Series | 2018

    Sustainability and Green Business in Latin America During Globalization Waves

    Geoffrey Jones

    This working paper examines the impact of modern business enterprise on the natural environment of Latin America during the globalization waves between the 19th century and the present day. It argues that although global capitalism created much wealth for the region, this was at the cost of massive ecological destruction in Latin America. During the first global economy considerable wealth was created from the exploitation of natural resources for the land-owning elite in Latin America, at the cost of large-scale ecological destruction. During the Great Reversal in the mid-20th century, public policies aimed at “catching up” resulted in the co-proliferation of hydro-electric schemes and resulting co-creation of ecological damage by firms and governments. In the new global economy since 1980, renewed economic growth and consumerism resulted in mountains of waste in increasingly polluted mega-cities. Biodiversity and the natural environment have been challenged across the subcontinent. However, there were interesting positives as these ecological horrors also created opportunities for a surprising cohort of green businesses across sectors ranging from beauty and health to ecotourism. In the 21st century, both business and governments in the region needed to address sustainability issues far more seriously, before a point of no return was reached.

    Keywords: Globalization; Natural Environment; Outcome or Result; Business History; Pollution and Pollutants; Environmental Sustainability; Green Technology Industry; Beauty and Cosmetics Industry; Tourism Industry; Latin America;

    Citation:

    Jones, Geoffrey. "Sustainability and Green Business in Latin America During Globalization Waves." Harvard Business School Working Paper, No. 19-009, August 2018.  View Details
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  2. Case | HBS Case Collection | July 2018

    LIXIL Group Corporation: Building a New Company in an Old Industry

    Boris Groysberg and Akiko Kanno

    In the spring of 2018, Kinya Seto, president and CEO of LIXIL Group Corporation, a major housing and building products and services company, called a meeting at the company’s head office in central Tokyo to discuss how to implement the new three-year strategic plan. LIXIL had been established in 2011 through a merger of five of Japan’s major companies across a broad spectrum of building materials and other housing-related businesses. The company had subsequently acquired established international brands such as American Standard and GROHE and had become a global company of over 70,000 employees operating in more than 150 countries. Its business lines included manufacturing and marketing construction materials and products for both commercial buildings and private houses, with subsidiary home-building and renovation franchises. The predecessor companies that formed LIXIL had each had a long history of business success, some dating back a hundred years. To accelerate the implementation of LIXIL’s global strategy, Seto and his senior management team had expressed ideas about creativity and innovation centered around differentiated products, services and business models. How could Seto position LIXIL for success? How much integration was needed at LIXIL? How could Seto build one LIXIL brand that would be recognized globally? Could design, new products, and a shift in business model from B2B to B2C be the drivers of growth? How should Seto execute LIXIL’s three-year plan? What is or are LIXIL’s source(s) of competitive advantage?

    Keywords: consolidation; turnaround; Leadership and Change Management; Consolidation; Change; Leadership; Global Strategy; Business Model; Consumer Products Industry; Manufacturing Industry; Japan;

    Citation:

    Groysberg, Boris, and Akiko Kanno. "LIXIL Group Corporation: Building a New Company in an Old Industry." Harvard Business School Case 419-009, July 2018.  View Details
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  3. Working Paper | HBS Working Paper Series | 2018

    Gifts of the Immigrants, Woes of the Natives: Lessons from the Age of Mass Migration

    Marco Tabellini

    In this paper, I show that political opposition to immigration can arise even when immigrants bring significant economic prosperity to receiving areas. I exploit exogenous variation in European immigration to US cities between 1910 and 1930 induced by World War I and the Immigration Acts of the 1920s, and instrument immigrants’ location decision relying on pre-existing settlement patterns. Immigration increased natives’ employment and occupational standing, and fostered industrial production and capital utilization. However, despite these economic benefits, it triggered hostile political reactions, such as the election of more conservative legislators, higher support for anti-immigration legislation, and lower public goods provision. Stitching the economic and the political results together, I provide evidence that natives’ backlash was increasing in the cultural differences between immigrants and natives, suggesting that diversity might be economically beneficial but politically hard to manage.

    Keywords: immigration; Political backlash; Age of Mass Migration; cultural diversity; Immigration; History; Economy; Attitudes; Cross-Cultural and Cross-Border Issues; Diversity; United States;

    Citation:

    Tabellini, Marco. "Gifts of the Immigrants, Woes of the Natives: Lessons from the Age of Mass Migration." Harvard Business School Working Paper, No. 19-005, July 2018. (Revised October 2018.)  View Details
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  4. Article | Economic Journal (Royal Economic Society) | July 2018

    Global Collaborative Patents

    Sari Pekkala Kerr and William R. Kerr

    We study the prevalence and traits of global collaborative patents for U.S. public companies, where the inventor team is located both within and outside of the United States. Collaborative patents are frequently observed when a corporation is entering into a new foreign region for innovative work, especially in settings where intellectual property protection is weak. We also connect collaborative patents to the ethnic composition of the firm’s U.S. inventors and cross-border mobility of inventors within the firm. The inventor team composition has important consequences for how the new knowledge is exploited within and outside of the firm.

    Keywords: patents; innovation; Research and Development; Ethnic Networks; migration; diasporas; foreign direct investment; Technology Transfer; globalization; mobility; Technology; Globalized Firms and Management; Diasporas; Patents; Ethnicity; Entrepreneurship; Research and Development; Foreign Direct Investment; Innovation and Invention; United States;

    Citation:

    Kerr, Sari Pekkala, and William R. Kerr. "Global Collaborative Patents." Economic Journal (Royal Economic Society) 128, no. 612 (July 2018): F235–F272.  View Details
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  5. Case | HBS Case Collection | June 2018

    Forta Furniture: International Expansion

    John A. Quelch and Karthik Easwar

    The Forta Furniture case highlights the need to consider new market expansion to grow a firm. It demonstrates that simply doing what has always been done is not sustainable when other competitors enter the market with differentiated or potentially superior offerings. In addition, the case suggests there are many routes to global expansion; a firm could look to build a brand in these new markets or compete as a private label. Further, the case addresses the need to combine quantitative and qualitative analyses for making superior decisions. Additionally, this case touches on the need to understand differences in resources and customer preferences in different countries and how a company should consider these factors when defining its growth strategy in deciding whether, where, and how to expand internationally. This case can be used in an introductory marketing management course for undergraduates or MBA students that discusses new market expansion and/or global or multi-market marketing strategy. In addition, it could be used in an elective course on international marketing. The case could also be used as an example of sales forecasting when a firm launches in a new market.

    Keywords: Market Entry and Exit; Global Range; Decision Making; Analysis; Cross-Cultural and Cross-Border Issues; Growth and Development Strategy; Brands and Branding; Expansion;

    Citation:

    Quelch, John A., and Karthik Easwar. "Forta Furniture: International Expansion." Harvard Business School Brief Case 918-547, June 2018.  View Details
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  6. Case | HBS Case Collection | June 2018

    Global Brand Management of Anheuser Busch InBev's Budweiser

    Jill Avery

    Brian Perkins, chief architect of the $6 billion Budweiser brand, was excited about 2018, in which the company would launch Budweiser into several new markets in Africa and Latin America. He was also feeling the pressure to finalize a global brand strategy that would define Budweiser’s value proposition and guide its development and execution around the world. The problem was that Budweiser actually had two distinct brand realities that differed across geographies and that often interfered with each other. He worried whether the company could keep selling a premium brand proposition abroad as the brand's reputation faced challenges at home in the U.S. and whether he needed to force a monolithic global brand strategy everywhere or allow for local market customization. Could Budweiser simultaneously accommodate two or more brand realities?

    Keywords: marketing; brands and branding; brand management; global brands; brand positioning; marketing strategy; advertising; brand extension; Marketing; Marketing Strategy; Brands and Branding; Advertising; Global Strategy; Cross-Cultural and Cross-Border Issues; Consumer Products Industry; Food and Beverage Industry; Advertising Industry; Africa; China; United States; North America; South Africa; Nigeria; Kenya; Cameroon; Canada;

    Citation:

    Avery, Jill. "Global Brand Management of Anheuser Busch InBev's Budweiser." Harvard Business School Case 518-105, June 2018.  View Details
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  7. Article | MIT Sloan Management Review | Summer 2018

    Why High-Tech Commoditization Is Accelerating

    Willy C. Shih

    Knowledge embedded within state-of-the-art production and design tools is a powerful force that is leveling the global technology playing field. It democratizes innovation and makes future competition more challenging. This paper describes the knowledge flows through production and design tools, and it suggests that the increasing level of abstraction is enabling new players to innovate without understanding how the technology building blocks they are using actually work inside. This suggests that there are new rules of competition, where firms should move beyond commoditized parts and focus their differentiation strategies.

    Keywords: Product design; product commercialization; product development; product development strategy; production; manufacturing tools; manufacturing; manufacturing industry; Engineering; Globalization; Goods and Commodities; Knowledge; Commercialization; Business Strategy; Corporate Strategy; Hardware; Technology Adoption; Consumer Products Industry; Auto Industry; Semiconductor Industry; Electronics Industry; Industrial Products Industry; Information Technology Industry; North America; Asia;

    Citation:

    Shih, Willy C. "Why High-Tech Commoditization Is Accelerating." Art. 59420. MIT Sloan Management Review 59, no. 4 (Summer 2018): 53–58.  View Details
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  8. Article | American Economic Journal: Economic Policy | May 2018

    Selection and Market Reallocation: Productivity Gains from Multinational Production

    Laura Alfaro and Maggie X. Chen

    Assessing the productivity gains from multinational production has been a vital topic of economic research and policy debate. Positive aggregate productivity gains are often attributed to within-firm productivity improvement; however, an alternative, less emphasized explanation is between-firm selection and market reallocation, whereby competition from multinationals leads to factor reallocation and the survival of only the most productive domestic firms. We investigate the roles of the two different mechanisms in determining the aggregate productivity gains by exploring their distinct predictions on the distributions of domestic firms: within-firm productivity improvement shifts the productivity and revenue distributions rightward while between-firm selection and market reallocation raise the left truncation of the distributions and shift revenue leftward. Using a rich cross-country firm-level panel dataset, we find significant evidence of both mechanisms, but between-firm selection and market reallocation accounts for the majority of aggregate productivity gains, suggesting that ignoring this channel could lead to substantial bias in understanding the nature of gains from multinational production.

    Keywords: Productivity gains; multinational production; selection; Market Reallocation; and within-firm productivity; Multinational Firms and Management; Production; Performance Productivity; Competition; Mathematical Methods;

    Citation:

    Alfaro, Laura, and Maggie X. Chen. "Selection and Market Reallocation: Productivity Gains from Multinational Production." American Economic Journal: Economic Policy 10, no. 2 (May 2018): 1–38. (Also NBER Working Paper w18207. See Harvard Business School Working Paper, No. 12–111, 2015 for longer version.)  View Details
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  9. Case | HBS Case Collection | April 2018

    Globalizing Japan's Dream Machine: Recruit Holdings Co., Ltd.

    Sandra J. Sucher and Shalene Gupta

    Recruit Holdings, an advertising media, staffing, and business support conglomerate was founded in 1960 by Hiromasa Ezoe. Recruit was built on the principle that the company should add value to society. To do this, it hired young and talented employees and created a culture of self-efficacy. In the late 1980s, Recruit hit rough waters. First, Ezoe sold 2.8 million shares in a Recruit subsidiary before it went public to 76 Japanese leaders in politics, business, and media. The "Recruit Scandal," as it was called, resulted in the resignation of Prime Minister Noburu Takeshita and his entire cabinet. A few years later, Recruit was mired in debt with interest payments of 65 billion yen when its annual income was only 62 billion yen. In the early ‘90s, the development of the Internet cut into Recruit’s core businesses, which were paper-based advertising. Yet by 2017, Recruit was a global conglomerate with $16 billion in sales. This case examines Recruit’s unique corporate culture that helped it survive a scandal so large it became a staple in Japanese textbooks, as well as Recruit’s subsequent globalization.

    Keywords: Business Conglomerates; Mission and Purpose; Organizational Culture; Crime and Corruption; Transition; Globalization; Japan;

    Citation:

    Sucher, Sandra J., and Shalene Gupta. "Globalizing Japan's Dream Machine: Recruit Holdings Co., Ltd." Harvard Business School Case 318-130, April 2018.  View Details
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  10. Chapter | Business Groups in the West: Origins, Evolution, and Resilience | 2018

    Britain: Global Legacy and Domestic Persistence

    G. Jones

    This chapter explores the British experience in a volume which examines the historical evolution of business groups in developed Western economies. The chapter argues that during the nineteenth century British merchant houses established business groups with diversified portfolio and pyramidal structures overseas, especially in developing economies, including both British colonies and the independent nations of Latin America. While these types of business groups remained a significant form of firm organization among enterprises specializing in overseas ventures, they did not become the dominant form of large enterprises within British economy itself. Business groups organized under the holding company such as Calico Printers' Association and Associated Portland Cement, as their names imply, were eventually a federation of many specialized companies. As they seldom committed to administrative centralization, their efficiency gain as a business organization remained marginal. The chapter first looks at the appearance and development of industry-focused and family-owned companies before World War II and the relative decline in importance of internationally-focused business groups during the second half of the twentieth century. The chapter then discusses the rise and fall of diversified and conglomerate type of groups like Hanson Trust and BTR, and the more durable Virgin Group and its counterparts. The empirical evidence presented in the chapter demonstrates that diversified business groups can add value in mature markets such as Britain. Even the much-criticized conglomerates of the 1970s-1990s were quite successful forms of business enterprise, and the demise of many of them appears to owe more to management fads than to serious underperformance.

    Keywords: business groups; business history; conglomerates; Globalization; Entrepreneurship; Business History; Organizations; Business Conglomerates; United Kingdom;

    Citation:

    Jones, G. "Britain: Global Legacy and Domestic Persistence." Chap. 5 in Business Groups in the West: Origins, Evolution, and Resilience, edited by Asli M. Colpan and Takashi Hikino, 123–146. New York: Oxford University Press, 2018.  View Details
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Initiatives & Projects

  • Global

    The Global Initiative builds on a legacy of global engagement by supporting the HBS community of faculty, students, and alumni in their work, encouraging a global outlook in research, study, and practice.

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HBS Working Knowledge

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re Michael E. Porter
Is the EU’s model of European integration a driver or a barrier towards higher European prosperity? This paper analyzes why the integration model that was successful in the past has lost effectivenes
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re Prithwiraj Choudhury and Tarun Khanna
This study compares how multinational corporation subsidiaries inherit knowledge from both the headquarters and the local context. To do so the authors analyzed seven years of data (2005–2011) of US
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re Willy C. Shih
The world's economies are interconnected by globalization, which makes threats of tariff wars doubly dangerous, says Willy Shih.

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Harvard Business Publishing

Article
by Paul M. Healy and Karthik Ramanna
Case
by John A. Quelch and Karthik Easwar

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