| NAFTA, Environmental Regulations and Firm Strategies |
| | Rugman, Alan M. | Templeton College, U. of Oxford | alan.rugman@templeton.oxford.ac.uk | 01865 422705 |
| | Kirton, John | U. of Toronto | jjkirton@trinity.utoronto.ca | 416 978 4652 |
| | The North American Free Trade Agreement (NAFTA) provides a unique laboratory
to investigate the corporate strategies of multinational enterprises (MNEs)
as they respond to a new political regime of trans-border environmental regulations.
The NAFTA is the first international trade and investment agreement to incorporate
such environmental laws and standards. As the new environmental and trade regime
of NAFTA emerges we find that the potential set of relevant strategies for firms
has expanded. We call this new NAFTA political regime a situation of "complex
institutional responsiveness". In this paper we first present the conditions
for complex institutional responsiveness and then consider, from the firm's
viewpoint, both corporate strategies and political strategies under such
conditions. |
| | Keywords: complex institutional responsi; environmental regulations; NAFTA |
| Are French Decision Makers Becoming Less Risk Averse? A Comparative Study of Risky Strategic Decisions in France and the U.S. |
| | Persing, D. Lynne | Ecole Superieure de Commerce de Toulouse | l.persing@esc-toulouse.fr | +33 5 61 13 94 10 |
| | Lacoste, Denis | U. de Toulouse 2/ Ecole Superieure de Commerce de Toulouse | d.lacoste@esc-toulouse.fr | 33 5 61 54 78 40 |
| | Lam, Long W. | U. of Houston, Clear Lake | lam@cl.uh.edu | (281)-283-3240 |
| | In environments of intense competition, risk aversion can slow and otherwise inhibit strategic decisions that are necessary for the firm to survive and thrive. France has long been thought to be risk averse in many contexts, including most aspects of business. Thus, this exploratory study focused on comparing the strategic decisions and preferences of current and future decision makers in France with their counterparts in the U.S. under the condition of a moderate level of strategic risk. As predicted, in the assumed role of top managers, the French respondents perceived more risk in a proposed decision to diversify into a new product area. However, contrary to expectations of more aversion in France, the French and American respondents were nonetheless equally willing to take that risk. These preliminary findings are interesting given that the view of French decision makers as risk averse--particularly vis-a-vis their U.S. counterparts--has persisted over a number of commentaries and investigations. The results may suggest that risk aversion is more of a function of outcome histories in a country with great institutional resistance to changes. That is, the French business students have not yet fully encountered the onerous administrative and governmental regulations that might lead them to become more reluctant to take strategic risks. The findings also may indicate that with globalization there is indeed increasing attitudinal and behavioral homogeneity among decision makers, suggesting some of the first evidence of a weakening of the grip of risk aversion in France. |
| | Keywords: Risk; France; Decision-making |
| Adapting to Globalization: Gearing up in the US Machine Tool Industry |
| | Berg, David Michael | U. of Texas, Dallas | dberg@utdallas.edu | (972)-883-6890 |
| | This research is designed to explore successful firm-level adaptation to industry globalization, in an attempt to shed light on ways firm may overcome competitive disadvantages relative to new, international, competitors. The two-part research question which drives this study is: How do firms adapt to globalization in their industry and what factors influence that adaptation? There are four key components to the study: 1) the characterization of globalization as a change force facing firms in a specific industry, 2) the relative impact of firm-level inertia (pre-globalization choices regarding Functional/Managerial Orientation, External Resource Focus,and Product/Market Focus) and firm-level intervention(post globalization changes in those factors) on firm-level adaptation, 3) the characterization of firm-level adaptation to globalization along two axes: Change in International Presence and Change in Technical Competence Base, 4) the context of the US Machine tool industry, in which import penetration during the 1980's rose from 20% to nearly 50%. The study is carried out through mail administration of a survey instrument to firms in the US machine tool industry. Respondents are asked to provide information on their firm's activities and strategies for three points in time: 1980 (pre-globalization), 1987 (early post-globalization and industry shakeout) and 1995. Antecedents of firm-level adaptation are examined with the use of two-stage linear regression models. Significant firm-level antecedents of adaptation are found to vary by time period (1980-1987 vs. 1987-1995) and by adaptation axis (Change in International Presence vs. Change in Technical Competence Base). |
| | Keywords: Adaptation; Globalization; Competitiveness |
| Competitive Rivalry in Multinational Markets: Strategic Options and Their Determinants |
| | Ma, Hao | Bryant College | hma@bryant.edu | 401-232-6327 |
| | This article conceptually explores the determinants of strategic options in multinational market competition. It draws on and integrates three research streams in strategy and international management: action and response in competitive rivalry; multipoint competition, and global competition and strategy. Specifically, it examines the various factors that determine whether and when a multinational corporation (MNC), while under attack from a rival MNC, will adopt the following responses: doing nothing, defending, counter-attack, and total war. Those factors are organized into four categories: 1) types of attack, including price cut, introduction of new product, entry into new market, and advertising campaign; 2) awareness of interdependence of multinational markets, determined by market overlap, MNC strategy, and MNC organization; 3) motivation for globally coordinated moves, determined by the centrality of national markets, strategic importance of national markets, perceived importance of national markets, and perceived importance of rivals; and 4) feasibility of response, determined by entry barriers and diversity of national markets as well as resource heterogeneity and differential between rival MNCs. The effects of these four categories of factors on the choice of response are explored both individually and jointly. Research implications are offered in concluding remarks. |
| | Keywords: Multinational Competition; Global Competitive Moves; Competitive Rivalry |