"The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations: A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia"

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.

"The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations: A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia" (in Japanese)

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.

The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations : A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.forthcoming in a book. 2002-CJ-66 (in Japanese)本文フィルはリンク先を参照のこ

The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations : A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia

In international business, much attention has been directed to the international expansion of firms based on their use of resources and competitive capabilities that have been built up in a home country to create a competitive advantage over host-country firms. More recently, the organizational capabilities and competitive advantages of Japanese manufacturing firms in general (in autos, electronics, etc.) have been analyzed as important factors in the establishment of overseas transplants. The theoretical framework of the overseas application of home-country management resources has been effective as a basic tool in analyzing the fundamental issue of international operations of the firm. However, the existing models, which tend to emphasize application of country-specific resources, does not sufficiently explain the frequently encountered question of why multinational enterprises (following, MNEs) from the same home country pursue different strategic paths and actions when managing overseas operations. The present paper attempts to incorporate a dynamic and firm-specific perspective and empirically analyze how differences in the financial resources and organizational capabilities of MNEs from the same home country affect the strategy and competitive behavior of their operations in the same local country. The analysis will center on the two Japanese auto assemblers, specifically Toyota Motor Corporation and Mitsubishi Motors Corporation, which have local production facilities in both Australia and Thailand. These two countries provide interesting case studies because in both the local operations experienced a serious crisis in recent years. The crisis for local auto producers in Australia began in the 1980s with the removal of protectionist policies and the rapid liberalization of the auto market. In Thailand, exceedingly severe conditions for local auto assemblers were caused by the 1997 Asian economic crisis. The present paper will focus its attention on the differences in the responses by Toyota and Mitsubishi to these crises, which we characterize as "larger competent firm" and "smaller competent firm" respectively. The two firms in question have both maintained international competitiveness in production in their common home country of Japan, in addition to building top-level local competitiveness in their Australian and Thai operations. However, when faced with a growth opportunity and a subsequent crisis, the responses of the local operations of the firms were markedly different. It is anticipated that behind these differences in firm conduct lie interfirm differences in firm scale (i.e. financial power) and dynamic organizational capabilities (e.g., capability-building capability) in their home country. The present paper will attempt to delineate these interfirm differences and their effects on firm conduct to explain why two firms from the same home country would show such different patterns of conduct even though they face the same local opportunities and crises.forthcoming in a book. 2002-CJ-66 (in Japanese

Environmental Change and Evolution of Over sea Manufacturing Subsidiaries: The Case of Toyota Motor Corporation Australia

トヨタ･オーストラリアは､数々の危機に直面し､対応する過程で相対的に高い組織能力を持つ海外生産拠点に進化した｡しかし､同社は再び現地通貨高という危機を迎え､その対応で全社的なコスト削減活動を実施した｡この活動は前回の危機対応と相通じるが､今回も旗振り役は経験豊富な日本人出向者で､進化能力は日本人に依然として依存している｡ただ､高い改善効果から､現地人のルーチン的な改善能力は高まっていることが分かる｡つまり､単に日常の業務を高品質に遂行する(ルーチン的なもの造り能力が高い)のみならず､方向性が明確になれば､きちんと改善活動を行える(ルーチン的な改善能力が高い)｡再度の危機への対応で､前回の努力で高まった組織能力を維持､向上させた｡現地人がルーチン的な改善能力を相当程度身に付けた現在､日本人の役割は､世界各地での豊富な経験を基に､進化能力を発揮して正しい方向性を示すことに､その重心が移ってきている｡\nToyota Motor Corporation Australia (TMCA) has evolved as an oversea manufacturing subsidiary with relatively strong organizational capability, overcoming several continuous managerial crises. However, TMCA faced another managerial crisis due to higher appreciation of Australian Dollar, and started companywide cost reduction activity. This activity was similar to the one for former continuous managerial crises, and it was led by Japanese expatriate, again. Thus, TMCA\u27s evolutionary learning capability still depended on Japanese expatriate. That is, great improvement indicates that Australians\u27 routinized learning capability enhanced, in addition to their routinized manufacturing capability that already enhanced. As Australians\u27 routinized learning capability enhanced, the major role of Japanese expatriates becomes changed to setting right direction of operation as well as corporate strategy, utilizing their evolutionary learning capabllity based on their rich experience worldwide

"TQC and TPS at Toyota Motor Corporation: A Lecture by Masao Nemoto, Former Senior Managing Director of Toyota Motor Corporation"(in Japanese)

This paper is based on a lecture provided by Masao Nemoto, Former Senior Managing Director of Toyota Motor Corporation and former Chairman/President of Toyota Gosei Co., Ltd. in July 1997. Mr Nemoto is known as one of the leaders of Toyota's TQC activities (Total Quality Control) during its early stages. He points out that Toyota's manufacturing system consists of two main components - TQC and TPS (Toyota Production System: Just-in-Time and Jidoka are its two main components), and argues that Toyota's TQC emphasizes not only worker involvement (e.g., QC circles), but also education and initiatives of Top/Middle managers, Kaizen activities (continuous improvements) by supervisors, and involvement of parts suppliers. This lecture clarifies that Toyota's manufacturing competence comes from a complementary relations between TQC and TPS.

The Strategic Effects of Firm Sizes and Dynamic Capabilities on Overseas Operations : A Case-based Comparison of Toyota and Mitsubishi in Thailand and Australia

国際経営論では、本国で培った競争能力を活用することが企業の海外展開における最大の要因であると捉えられてきた。確かに本国での経営資源を海外に適用するという理論枠組みは、企業の多国籍展開を論じるうえで極めて有効であった。しかし、こうした国特殊的な資源の海外適用に焦点を当てる傾向が強い既存の枠組みでは、同じ国を本国とする多国籍企業が海外においてそれぞれ違った戦略を採る背景を十分には説明できない。本稿では、同じ国を本国とする多国籍企業の財務的資源や組織能力が、どのよう同じホスト国でのオペレーションに影響するかを、動態的かつ企業特殊的な見地から分析を試みた。トヨタ自動車と三菱自動車工業の豪州とタイの現地生産拠点を分析対象とした。これら２力国の自動車産業は共に最近深刻な危機に直面しており、極めて興味深いケースである。1980年代半ば以降、豪州の国内自動車メーカーを襲った危機は、国内産業保護政策の撤廃とそれに引き続く急速な自動車輸入自由化が招いたものだった。一方タイでは、1997年のアジア経済危機により、国内自動車メーカーは深刻な危機に直面することになった。本稿では、こうした危機に対するトヨタと三菱自工の戦略対応の違いに焦点を当て、それぞれ「強い大企業」「強い小企業」と特徴付ける。分析対象とした２つの企業は、日本国内において国際競争力のある生産システムを持っている上、豪州やタイにおいてもトップレベルの競争力を持って生産拠点を維持している。しかし、成長機会や深刻な危機に直面した際の対応は、決定的に異なったものであった。こうした違いの背景には、本国日本における企業規模（財務的能力に直結）や動態的な組織能力（例えば、能力構築能力）の違いがあったと捉えられる。本稿は、従来の理論枠組みの重要性は認識しつつも、なぜ同じホスト国における事業機会や危機に際して同じ国を本国とする２企業が違った戦略対応をするのかを説明する上で、企業間の違いやその企業活動への影響に対する分析視点の重要性を主張する。英語版はCF143/2002-CF-143(in English)Akamon Management Review（赤門マネジメント・レビュー）, 2(4), 2003, p. 141-162.本文フィルはリンク先を参照のこ