Knowledge that Transforms

Research on multinational corporations (MNCs) has neglected routines despite their importance for the process of coordination, and their prominence in organization theory. This paper focuses on three aspects of routinization in MNCs. First, the transmission of routines across cultural boundaries in considered. Second, the focus moves to routine interactions between performance teams in MNCs. Third, I discuss how such routines contribute to the structuring of complex international systems. The conclusion suggests that the MNC may have to recognize that every replica of an existing facility is also an experimental test of taken-for-granted practices.

This article presents an issue-area approach to the analysis of relations between multinational enterprises and governments. The concept of issue-areas is drawn from a body of political science literature that has been neglected in the literature of international business. The central theme of the analysis is that business-government relations vary systematically across issue-areas in their interactions and outcomes. An issue-area typology from the political science literature is applied to MNE-government relations concerning inbound foreign direct investment in the United States. The article adopts a heuristic approach, as is appropriate in this first stage in the development of an issue-area theory of MNE-government relations.

Many factors may contribute to the high rate of expatriate turnover experienced by U.S. multinational corporations. The objective of this article is to present a comprehensive model of the expatriate turnover process by identifying the key contributing factors and suggesting intermediate linkages and relationships. The model appears to have both managerial and theoretical implications.

Increased communication, trade and travel between countries act to bring them together in many respects. The present study examines similarities in macro-environmental characteristics of eighteen industrialized nations over a twenty-eight-year period. Contrary to the initial research proposition, countries were found to be diverging, especially in the latter part of the time period. In spite of the increased communications, travel and trade between countries, physical distance remains an important determinant of macro-environmental similarity. Two measures of national culture, Power Distance and Individualism, were found to be related to change in macro-environmental factors.

This study examines the valuation consequences of domestic and foreign divestments by comparing the stock price reaction to announcements of domestic plant closings and foreign plant closings. A domestic plant closing could indicate firm-wide problems and impending firm deterioration. A foreign plant may serve to exploit arbitrage opportunities specific to that plant location. Closing a foreign plant need not signify firm-wide problems. Our comparison of stated reasons for closings supports these propositions. Therefore, foreign plant closing announcements should produce a smaller stock price decline that domestic plant closing announcements. Empirical results indicate a significant negative stock price reaction for domestic plant closings and an insignificant negative stock price reaction for foreign plant closings. Differences in stock price reaction remain after controlling for firm-specific factors.

Fifty-six Soviet businesspeople and 160 American businesspeople participated in simulated intracultural, one-on-one, buyer-seller negotiations. All participants completed questionnaires after the negotiation sessions, and six negotiators from each cultural group were videotaped during the interactions. Analysis of the questionnaire data indicated that Soviet negotiators achieved higher individual profits when using a competitive approach in negotiations. This result is in contrast to a more cooperative approach associated with higher profits for the American participants. Analysis of the videotapes suggests both similarities and differences in observed bargaining behaviors across the two cultural groups.