Evidence on the strategies and capabilities of Japanese multinational companies (MNCs) and their subsidiaries points to aspects of established Japanese management practices (typically home-grown) that complicate or inhibit adaptation to the new demands of global competition since the 1990s. Japanese MNCs have had to respond, amongst other trends, to the switch from production to buyer-driven global value chains; the growing incidence of cross-border vertical specialization; the emergence of global factory strategies, and the rising incidence of strategic alliances and cooperative relationships. Amongst the factors that might affect the ability of Japanese MNCs to make competitive and organizational transitions are: parental MNC intent and capability in the cross-border transfer of management practices; the impact of host country risk on investment, ownership and entry strategies; measures of institutional difference and the gap in economic development between home and host nations; parent firm-subsidiary and subsidiary-subsidiary power relations and knowledge boundaries; and the evolution of insider networks that might overcome institutional and cultural distances within an MNC.
- cross-border capability transfer
- cross-border difference
- global value chains
- global factory
- strategic alliance