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1. To describe the four characteristics of core competencies, which are the higher-order firm-specific advantages (FSAs) of the firm.
2. To explain the importance of the corporation’s ‘strategic architecture’ in the context of core competencies.
3. To develop an understanding of MNEs’ business model diversification, whereby the FSAs deployed in each business model, though at least different in part, should also mutually reinforce one another to drive growth and profitability.
4. To identify the bounded rationality and bounded reliability problems associated with MNEs outsourcing their R&D, if they want to maintain or build core competencies in innovation.
5. Based on the conceptual framework in Chapter 1, to analyze the managerial implications of an ill-conceived, sole focus on core competencies.
1. To describe the challenges associated with centralizing strategic decision making and control in MNEs, and to highlight the possible ineffectiveness thereof.
2. To develop a framework for classifying MNE subsidiaries as a function of the location advantages they can access and the unique bundles of FSAs they command inside the firm, but with due consideration to the value chain activities involved.
3. To foster reﬂection on the ‘procedural justice’ concept and to highlight the impact thereof on decision making and organizational effectiveness.
4. To explain MNEs’ strategic agility in terms of balancing the tensions between head office priorities and local priorities in high distance markets.
5. To highlight the managerial implications of assigning differentiated roles to MNE subsidiaries.
1. To develop an understanding of the seven concepts of this book’s unifying framework.
2. To link specific types of transfers of firm-specific advantages (FSAs) across borders with the four corresponding multinational enterprise (MNE) archetypes of administrative heritage.
3. To describe the various motivations for foreign direct investment (FDI) and to explain the linkages among non-location-bound (or internationally transferable) FSAs, location-bound (or non-transferable) FSAs, and location advantages within each of the four MNE archetypes.
4. To define the ten often-observed patterns of FSA development and resource recombination in international business.
5. To explain the need for complementary resources of external actors, including those in the MNE’s stakeholder network and ecosystem, and the potential reasons for bounded rationality and bounded reliability when doing international business.
1. To explain the reasons why MNEs establish long-term relationships with local distributors, even when they also command a wholly owned distribution network.
2. To foster an understanding of the role foreign distributors can play in the FSA development process.
3. To provide concrete guidelines to MNEs on how to manage supply chains in their entirety (from sourcing to distribution), in international environments characterized by great uncertainty and volatility.
4. To describe the need for adaptive governance of supply chains and related investments in logistics-related technologies.
5. To highlight the benefits of mapping the MNE’s supply chain network with a focus on those points in the network that could trigger major negative impacts if a large-scale disturbance occurred.