26 research outputs found
Ex-post Performance Implications of Divergence of Managersâ Perceptions of âDistanceâ From âRealityâ in International Business
Despite much research on âdistanceâ, little attention has been paid to the effect of divergence of managersâ perceptions of distance from reality (i.e. distance divergence) and its implications for firm performance. This knowledge is highly important since managerial perceptions of the firmâs environment do not always coincide with the actual environmental characteristics. Consequently, strategies based on inaccurate data may result in erroneous forecasts, missed opportunities and business failure. Using survey data from senior managers of Swedish exporters and corresponding objective data, this study is a first attempt to explore the ex-post performance implications of âdistance divergenceâ when expanding into foreign markets. Our results demonstrate that the larger the divergence between managersâ perceptions of cultural distance and corresponding âobjectiveâ distance, the lower the performance expressed in companiesâ sales. However, over/underestimation of cultural distance does not have differential effects on firm performance.âStiftelsen Olle Hakelius Stipendiefondâ, Grant no: 1165001
Host-country environment and subsidiary competence: Extending the diamond network model
We extend the âcenters of excellenceâ concept to address the diversity and multidimensionality of subsidiary competence. Using Rugman and Verbeke's diamond network model, we hypothesize the contingencies influencing the links between host-country environments and subsidiary competence configuration, and provide evidence from more than 2000 subsidiaries in seven European countries. Our results provide new insights into how multinational enterprises can overcome âunbalancedâ national diamonds by acquiring complementary capabilities across borders. Journal of International Business Studies (2009) 40, 42â57. doi:10.1057/palgrave.jibs.8400420