Globalization of an ethnocentric firm: An evolutionary perspective

Abstract

This paper investigates the globalization process at one traditionally ethnocentric firm. Whereas there has been substantial research on how multinational corporations (MNCs) structure and manage worldwide activities, little research has investigated how MNCs move toward proposed integrated network structures. The paper develops an evolutionary perspective of this process at traditionally ethnocentric firms, suggesting that it is driven by a shifting mix of strategic objectives over time, each of which differs in its impact on various functions. The paper suggests that globalization occurs at the level of the function, rather than the firm, and highlights important differences in the timing, sequence, and objectives of the process across functions. It also describes the importance of development patterns across functions, as changes in one function create opportunities and requirements for changes in others. Finally, the paper develops a framework of the process that can be tested at subsequent sites.