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Network Development and Firm Performance: A Field Study of Internationalizing Japanese Firms

Network Development and Firm Performance: A Field Study of Internationalizing Japanese Firms This paper explores the potential competitive advantages from the development of an internal network of subsidiaries and external network of alliances. Given the broad scope and lack of systematic investigation in prior research, clinical field research was conducted in eleven Japanese subsidiaries in China. Our in‐depth interviews revealed that there are benefits and costs associated with the development of both subsidiary networks and alliance networks. While there are exploitation and exploration benefits from subsidiary network development, internationalizing firms (especially smaller firms) are subject to the liability of foreignness. Alliance network development is an effective way to mitigate this liability if internationalizing firms choose the right alliance strategy. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Multinational Business Review Emerald Publishing

Network Development and Firm Performance: A Field Study of Internationalizing Japanese Firms

Multinational Business Review , Volume 12 (3): 21 – Nov 19, 2004

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Publisher
Emerald Publishing
Copyright
Copyright © 2004 Emerald Group Publishing Limited. All rights reserved.
ISSN
1525-383X
DOI
10.1108/1525383X200400015
Publisher site
See Article on Publisher Site

Abstract

This paper explores the potential competitive advantages from the development of an internal network of subsidiaries and external network of alliances. Given the broad scope and lack of systematic investigation in prior research, clinical field research was conducted in eleven Japanese subsidiaries in China. Our in‐depth interviews revealed that there are benefits and costs associated with the development of both subsidiary networks and alliance networks. While there are exploitation and exploration benefits from subsidiary network development, internationalizing firms (especially smaller firms) are subject to the liability of foreignness. Alliance network development is an effective way to mitigate this liability if internationalizing firms choose the right alliance strategy.

Journal

Multinational Business ReviewEmerald Publishing

Published: Nov 19, 2004

Keywords: Subsidiaries; Subsidiary networks; Internationalisation; Alliance strategy,; Multinational corporations

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