Applying and advancing internalization theory: The multinational enterprise in the twenty-first century

Innovation in all its forms is a key aspect of maintaining and upgrading firm-specific advantages (FSAs).

“Innovation in all its forms is a key aspect of maintaining and upgrading firm-specific advantages (FSAs), and the IB literature has long acknowledged that these innovations are not necessarily limited to technological assets but may include organizational, managerial, and transactional innovations (Narula et al., 2019).”

Innovations are not necessarily limited to technological assets but may include organizational, managerial, and transactional innovations.

“Innovation in all its forms is a key aspect of maintaining and upgrading firm-specific advantages (FSAs), and the IB literature has long acknowledged that these innovations are not necessarily limited to technological assets but may include organizational, managerial, and transactional innovations (Narula et al., 2019).”

MNEs create capabilities (firm-specific advantages) to integrate new knowledge and relationships from abroad with their existing routines and organizations.

“The prevalent view is that MNEs create capabilities (firm-specific advantages) to integrate new knowledge and relationships from abroad with their existing routines and organizations (Kumaraswamy et al., 2012; Narula et al., 2019).”

The building-up of FSAs and the creation of competitive advantage depends crucially on the ability of firms to 'bundle' or 'recombine' a diversity of different asset classes.

“The IB literature is equivocal that the building-up of FSAs and the creation of competitive advantage depends crucially on the ability of firms to 'bundle' or 'recombine' a diversity of different asset classes”