Evaluate the Case Made in the Article for ‘the Third Leg in the Strategy “Tripod”’, with Particular Reference to the Effectiveness of the Four Cases Offered in Supporting the Central Argument of This Article.

1355 Words Mar 27th, 2013 6 Pages
Institution Based Theory: An Evaluation

Introduction: Succeeding in international business is a tough job even for the most experienced multinational enterprise; international business has never come at a small price. There are trade barriers; cultural, political difficulties coupled with resource allocation and management strategy issues. In the mist of all these challenges some MNEs especially those from developing countries enter the international business arena with limited resources and experience and they still succeed.

The fundamental question is what makes developing countries MNEs succeed in international business and what factors influence the firm’s strategy in international business?

Several reasons have been
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This therefore means that the overall performance of the Indian business process outsourcing industries will inevitably be dependent on both the local and international institutional frame work.
c) Growing the firm from China - Peng, Wang & Jiang (2008) further argued that it has long being observed that a poor regulated economies cannot record high economic growth, but China has proved that in the absence of formal regulatory frame work, informal relationships help regulate the market. Such informal rules such as norms governing interpersonal relationships (networking) play a greater role in driving organizational strategies and performance. Such informal networking tactics have also been reported in Argentina, Chile and India amongst others. These informal networking is also adopted by foreign firms while doing business in China. This proves that cultural rules are important in determining firm success.
d) Growing the Corporation in Emerging Economies – In emerging economies organizations are owned by families or the state. When conflicts occur they are usually between the two principal owners, the controlling shareholders and the minority shareholders, this means that a better understanding of the institutional experience and the cost of corporate governance in emerging economies is necessary as these are fundamentally

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