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. Case | HBS Case Collection | April 2019

    Coup or Crime? The Case of Carlos Ghosn

    Aiyesha Dey, Jonas Heese and Puneet Brar

    This case explores the interplay of global corporations, management styles, and local traditions through the high profile arrest of auto industry icon, Carlos Ghosn, in November 2018. The case allows students to debate opposing theories that led to the arrest and examines several key themes, such as leadership challenges in an increasingly global market, role of culture, and the design and role of incentive and governance mechanisms. The case also allows for discussions on personal accountability in light of misbehavior.

    Keywords: Management Style; Globalized Markets and Industries; Problems and Challenges; Ethics; Governance Controls;

    Citation:

    Dey, Aiyesha, Jonas Heese, and Puneet Brar. "Coup or Crime? The Case of Carlos Ghosn." Harvard Business School Case 119-096, April 2019.  View Details
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  2. Article | Journal of Political Economy | April 2019

    Internalizing Global Value Chains: A Firm-Level Analysis

    Laura Alfaro, Pol Antràs, Davin Chor and Paola Conconi

    In recent decades, advances in information and communication technology and falling trade barriers have led firms to retain within their boundaries and in their domestic economies only a subset of their production stages. A key decision facing firms worldwide is the extent of control to exert over the different segments of their production processes. We describe a property-rights model of firm boundary choices along the value chain that generalizes Antràs and Chor (2013). To assess the evidence, we construct firm-level measures of the upstreamness of integrated and non-integrated inputs by combining information on the production activities of firms operating in more than 100 countries with input-output tables. In line with the model's predictions, we find that whether a firm integrates upstream or downstream suppliers depends crucially on the elasticity of demand for its final product. Moreover, a firm's propensity to integrate a given stage of the value chain is shaped by the relative contractibility of the stages located upstream versus downstream from that stage, as well as by the firm's productivity. Our results suggest that contractual frictions play an important role in shaping the integration choices of firms around the world.

    Keywords: Global value chains; Sequential production; Incomplete Contracts; Demand and Consumers; Customer Value and Value Chain; Globalization;

    Citation:

    Alfaro, Laura, Pol Antràs, Davin Chor, and Paola Conconi. "Internalizing Global Value Chains: A Firm-Level Analysis." Journal of Political Economy 127, no. 2 (April 2019): 508–559. (See Online Appendix. Replications files available here. Also NBER Working Paper 21582.)  View Details
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  3. Chapter | The Oxford Handbook of Structural Transformation | 2019

    Location Fundamentals, Agglomeration Economies, and the Geography of Multinational Firms

    Laura Alfaro and Maggie Xiaoyang Chen

    Multinationals exhibit distinct agglomeration patterns, which have transformed the global landscape of industrial production (Alfaro and Chen, 2014). Using a unique worldwide plant-level dataset that reports detailed location, ownership, and operation information for plants in over 100 countries, we construct a spatially continuous index of pairwise-industry agglomeration and investigate the patterns and determinants underlying the global economic geography of multinational firms. In particular, we run a horserace between two distinct economic forces: location fundamentals and agglomeration economies. We find that location fundamentals, including market access and comparative advantage, and agglomeration economies, including capital-good market externality and technology diffusion, play a particularly important role in multinationals' economic geography. These findings remain robust when we use alternative measures of trade costs, address potential reverse causality, and explore regional patterns.

    Keywords: multinational firm; economic geography; agglomeration; location fundamentals; agglomeration economies; Multinational Firms and Management; Geographic Location; Industry Clusters; Economics;

    Citation:

    Alfaro, Laura, and Maggie Xiaoyang Chen. "Location Fundamentals, Agglomeration Economies, and the Geography of Multinational Firms." Chap. 10 in The Oxford Handbook of Structural Transformation, edited by Célestin Monga and Justin Yifu Lin. Oxford University Press, 2019.  View Details
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  4. Case | HBS Case Collection | March 2019 (Revised June 2019)

    Global Sourcing at Nike

    Nien-hê Hsieh, Michael W. Toffel and Olivia Hull

    This case explores the evolution of Nike’s global product sourcing strategy, in particular ongoing efforts to improve working conditions at its suppliers’ factories. When the case opens in July 2018, Vice President of Sourcing Amanda Tucker and her colleagues in Nike’s Global Sourcing and Manufacturing division were focusing on three key supply chain challenges: sourcing from suppliers that meet compliance standards, challenging and encouraging suppliers to improve capabilities, and being responsive to consumer demand across the world.

    Keywords: sourcing; Factory conditions; Trade; Geography; Geographic Scope; Globalized Firms and Management; Corporate Accountability; Corporate Governance; Governance Compliance; Collaborative Innovation and Invention; Innovation Strategy; Labor; Human Capital; Working Conditions; Supply Chain Management; Corporate Social Responsibility and Impact; Organizational Change and Adaptation; Labor and Management Relations; Complexity; Sports Industry; Fashion Industry; Oregon; Portland; Asia; North and Central America;

    Citation:

    Hsieh, Nien-hê, Michael W. Toffel, and Olivia Hull. "Global Sourcing at Nike." Harvard Business School Case 619-008, March 2019. (Revised June 2019.)  View Details
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  5. Case | HBS Case Collection | March 2019

    Dabur India: Growing Professional Management from Family Roots

    Suraj Srinivasan, Namrata Arora and Jonah Goldberg

    The case opens in December of 2018, with Sunil Duggal, the CEO of Dabur India (a multinational consumer goods conglomerate with a focus in Ayurvedic products) contemplating who should succeed him at the head of the company. The new CEO will have been the first since Dabur completed its transition from family management to professional management in 2002 and, though publicly listed, the majority of the company’s shares were still owned by the Burman family, who founded it in 1884. The case then describes how the Burman family grew the company until the mid-1990s when professionalization began. The case explains the various obstacles and difficulties that the company overcame in the process of professionalization and explains how the family came to step back from the business. It specifies the nature of the family’s involvement during Duggal’s tenure as CEO as the company expanded across the globe, and then it closes by returning to the question of what a professionalized, multinational family business should be seeking in its next CEO, sixteen years after it last confronted such a decision.

    Keywords: Family Business; Management Succession; Multinational Firms and Management; Business Growth and Maturation;

    Citation:

    Srinivasan, Suraj, Namrata Arora, and Jonah Goldberg. "Dabur India: Growing Professional Management from Family Roots." Harvard Business School Case 119-089, March 2019.  View Details
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  6. Article | Organization Science | March–April 2019

    A Recombination-Based Internationalization Model: Evidence from Narayana Health's Journey from India to the Cayman Islands

    Budhaditya Gupta and Tarun Khanna

    Internationalizing firms often find developing host-country resources challenging as they simultaneously attempt to replicate the resources that worked well in their home country and adapt them to fit the context of the host country. On the basis of a longitudinal study of the expansion of India-domiciled Narayana Health (NH), a tertiary healthcare provider, to the contextually distinct Cayman Islands, we propose a recombination-based internationalization model that allows us to offer a new conception of this replication—adaptation tradeoff. Recombination entails creating anew in the host country by drawing from, adapting, and integrating diverse resources developed earlier in heterogeneous settings in the home country. We theoretically explore the mechanisms underlying such recombination processes in organizational settings.

    Keywords: recombination; internationalization; Cross-Cultural and Cross-Border Issues; Multinational Firms and Management; Health Care and Treatment; India; Cayman Islands;

    Citation:

    Gupta, Budhaditya, and Tarun Khanna. "A Recombination-Based Internationalization Model: Evidence from Narayana Health's Journey from India to the Cayman Islands." Organization Science 30, no. 2 (March–April 2019): 405–425.  View Details
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  7. Chapter | The Oxford Handbook of Management in Emerging Markets | 2019

    International Business and Emerging Markets in Historical Perspective

    G. Jones

    This chapter examines international business in emerging markets over the long run. It shows how the strategies of Western multinationals evolved over time. In the first era of globalization in the 19th century, Western firms sought access to resources, and they faced little political risk due to Western imperialism. The main risks were logistical due to infrastructure and technological inadequacies. During the Great Reversal between 1929 and 1979, the main challenges faced by Western multinationals were political, as they faced widespread host government hostility and expropriation. In the contemporary global economy, political risk partially declined with the spread of liberalization, although the management of relations with host governments remained a challenge, notably in China. The growth of local competitors and a resurgence in local consumer sensitivities obliged multinationals to incorporate local relevance into global brands.

    Keywords: Emerging Markets; Business History; Multinational Firms and Management; Globalization;

    Citation:

    Jones, G. "International Business and Emerging Markets in Historical Perspective." Chap. 3 in The Oxford Handbook of Management in Emerging Markets, edited by Robert Grosse and Klaus E. Meyer, 55–76. Oxford, UK: Oxford University Press, 2019.  View Details
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  8. Article | Cambridge Journal of Regions, Economy and Society | March 2019

    The New Silk Road: Implications for Higher Education in China and the West?

    William C. Kirby and Marijk C. van der Wende

    Recent geopolitical events, such as Brexit and the retreat from multilateral trade and cooperation by the USA, have created waves of uncertainty, especially in the field of higher education, regarding international cooperation. Meanwhile, China is publicly seeking to take the lead in globalisation, developing its higher education and research systems at speed and actively seeking to cooperate with academic partners along the New Silk Roads in order to attract talent (back). But under which conditions, whose definitions, and based on what values? And what, if any, difference will the “New Silk Road” make in the global educational landscape?

    Keywords: New Silk Road; Globalization; Higher Education; Global Range; International Relations; Cooperation;

    Citation:

    Kirby, William C., and Marijk C. van der Wende. "The New Silk Road: Implications for Higher Education in China and the West?" Cambridge Journal of Regions, Economy and Society 12, no. 1 (March 2019): 127–144.  View Details
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  9. Case | HBS Case Collection | February 2019

    Zhejiang Geely Holding Group: Acquisition of Volvo Cars

    Felix Oberholzer-Gee, Willy Shih and Nancy Dai

    Zhejiang Geely Holding Company's acquisition of Volvo cars was widely viewed with skepticism because of the poor track record of cross-border auto industry acquisitions. This case looks at the acquisition and post-acquisition integration from the point of view of Chinese managers at Geely. A companion case, HBS No. 613-042, “Volvo Cars: Acquisition by Geely” looks at the acquisition from the point of view of Swedish managers at Volvo.

    Keywords: merger integration; organization culture; Organization Behavior; organizational alignment; Mergers and Acquisitions; Integration; Alignment; Organizational Culture; Cross-Cultural and Cross-Border Issues; Auto Industry; China; Sweden;

    Citation:

    Oberholzer-Gee, Felix, Willy Shih, and Nancy Dai. "Zhejiang Geely Holding Group: Acquisition of Volvo Cars." Harvard Business School Case 619-041, February 2019.  View Details
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  10. Case | HBS Case Collection | February 2019

    Volvo Cars: Acquisition by Geely

    Felix Oberholzer-Gee, Willy Shih and Nancy Dai

    Zheijiang Geely Holding Company's acquisition of Volvo Cars was widely viewed with skepticism because of the poor track record of cross-border auto industry acquisitions. This case looks at the acquisition and post-acquisition integration from the point of view of Swedish managers at Volvo. A companion case, HBS No. 613-041, “Zheijiang Geely Holding Group: Acquisition of Volvo Cars” looks at the acquisition from the point of view of Chinese managers at Geely.

    Keywords: merger integration; organization culture; Organization Behavior; organizational alignment; Mergers and Acquisitions; Integration; Alignment; Organizational Culture; Cross-Cultural and Cross-Border Issues; Auto Industry; China; Sweden;

    Citation:

    Oberholzer-Gee, Felix, Willy Shih, and Nancy Dai. "Volvo Cars: Acquisition by Geely." Harvard Business School Case 619-042, February 2019.  View Details
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    11.  
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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.

Faculty

HBS Working Knowledge

Pic
re Geoffrey G. Jones
Geoffrey Jones discusses the overthrow of President Jacobo Arbenz of Guatemala in 1954 in a US-backed coup supporting United Fruit Company and a key landmark in the history of globalization.
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re William R. Kerr
High-skilled workers in today’s knowledge-based economy are arguably the most important resource to the success of businesses, regions, and industries. This chapter pulls from Kerr’s book The Gift of
PicPic
re Geoffrey G. Jones and Tarun Khanna
Geoffrey G. Jones reports on a business history conference studying the many shades of capitalism around the world and through time.

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Harvard Business Publishing

Article
by Paul M. Healy and Karthik Ramanna
Case
by Aiyesha Dey, Jonas Heese and Puneet Brar

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