Global corporate competition: Who's winning, who's losing, and the R&D factor as one reason why

Global corporate competition: Who's winning, who's losing, and the R&D factor as one reason why This study summarizes the major changes over the period 1960–86 in the shares of world markets of the world'S leading American, European and Asian corporations based in 15 major industries. It relates the differential sales growth rates of the gaining and losing firms to national trends in industrial competitiveness, to employment change and to long‐term returns to shareholders. One principal determinant of firms' global growth rates, and thence gains and losses in ‘world market share’, corporate research and development (R&D) intensity, is examined and tested on an 83‐firm, six‐industry subset of the overall data base. The proportion of corporate sales revenues allocated to commercially oriented R&D emerges as a, perhaps the, principal indicator of subsequent sales growth performance relative to competition over 5–10‐year periods. Insofar as many U.S. and U.K. firms have lost global market share relative to Asian and European competitors over the past two decades, a significant contributory factor would appear to have been negligence on the part of many U.S. and U.K. firms of investment in technology as a factor determining strategic, competitive advantage. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic Management Journal Wiley

Global corporate competition: Who's winning, who's losing, and the R&D factor as one reason why

Strategic Management Journal, Volume 10 (5) – Sep 1, 1989

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Publisher
Wiley
Copyright
Copyright © 1989 John Wiley & Sons, Ltd.
ISSN
0143-2095
eISSN
1097-0266
DOI
10.1002/smj.4250100505
Publisher site
See Article on Publisher Site

Abstract

This study summarizes the major changes over the period 1960–86 in the shares of world markets of the world'S leading American, European and Asian corporations based in 15 major industries. It relates the differential sales growth rates of the gaining and losing firms to national trends in industrial competitiveness, to employment change and to long‐term returns to shareholders. One principal determinant of firms' global growth rates, and thence gains and losses in ‘world market share’, corporate research and development (R&D) intensity, is examined and tested on an 83‐firm, six‐industry subset of the overall data base. The proportion of corporate sales revenues allocated to commercially oriented R&D emerges as a, perhaps the, principal indicator of subsequent sales growth performance relative to competition over 5–10‐year periods. Insofar as many U.S. and U.K. firms have lost global market share relative to Asian and European competitors over the past two decades, a significant contributory factor would appear to have been negligence on the part of many U.S. and U.K. firms of investment in technology as a factor determining strategic, competitive advantage.

Journal

Strategic Management JournalWiley

Published: Sep 1, 1989

References

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