Frank McDonald

The strategic challenge of electronic commerce

Based on the results of an ongoing study into the impact of e‐commerce on UK business. The authors have provided input from both academic and commercial viewpoints. The intention is to monitor the changing landscape of the commercial world over a period of time and this study provides grounding to this process, drawing some important conclusions that will have an effect across a large section of UK business. The paper charts the advent of the e‐commerce revolution and how business is adapting to this new paradigm. Examples include the Co‐operative Bank, Waterstones and RS Components. Legal aspects of the Internet and commerce on it are also interpreted with ramifications for organisations that are protecting their data as well as positioning themselves to exploit the commercial opportunities that the Internet offers.

Geographical concentration and competitiveness in the European Union

Considers the importance of geographical and institutional factors in the development of clusters and industrial districts as a response to economic integration in the European Union (EU). Theoretical works by economists, economic geographers and organisational theorists are synthesised to provide a framework for the analysis of the emergence and/or development of the geographical concentration of firms in response to economic integration in the EU. An explanation based on competitive advantages from creating or developing geographical concentration in response to economic integration is proposed. A threefold classification is made to distinguish between different types of industrial geographical concentration – clusters, industrial districts type I, and industrial districts type II. Argues that the main difference between these three kinds of geographical concentration is attributed to the nature of their networks. Finally, the paper illustrates the importance of geographical concentrations for international business by considering a famous Italian industrial district, the ceramic tile industry in Sassuolo.

THE SINGLE EUROPEAN MARKET

A review of the two major reports published on the likely effects of the Single European Market, together with a review of a book (Pelkman and Winters) which seeks to examine the impact of different reviews of a single market and to assess the likely effects on the UK economy. The review seeks to set out the primary an secondary effects of creating a Single European Market. This is done for both the economic and, to a lesser extent, the political environment.

Globalisation, nationality of ownership and employee relations: German multinationals in the UK

Based on a representative survey of German subsidiaries in the UK, their parent companies and a comparative analysis to the Workplace Employee Relations Survey 1998, the article examines the impact of nationality of ownership on employee relations (ER) in German multinational companies (MNCs) operating in an Anglo‐Saxon setting. It also assesses whether in light of heightened international competition and the problems in the German ER model, there has been a weakening of the home country effect over time. The study finds little evidence of a home country effect in relation to ER structures but reveals a pronounced country‐of‐origin effect in the ER approach and style. There is also evidence that German MNCs have responded to the globalisation pressures of the 1990s by a heightened emphasis on the country‐of‐origin collective approach in their UK subsidiaries, whilst at the same time developing comprehensive direct human resource management employee involvement schemes to complement, rather than substitute collective ER.

The nascent European policy towards older workers: can the European Union help the older worker?

Considers the reasons for the lack of consensus among the member states of the European Union (EU) on both the scope and extent of an ageism policy. The EU has become increasingly concerned with the problems that are raised by the ageing of the European population. In response to these concerns the EU has began to develop a policy towards older employees. The expectation of the EU is that this policy will help the member states effectively to adjust to the demographic challenge of an ageing population. Assessment of the effectiveness of the approach taken by the EU is made by utilizing economic theories that have been devised by neo‐classical and equal opportunities economists. The prospects for the development of a common EU policy on ageism is discussed and its possible impact on companies operating in the EU is explored.

Cautious international entrepreneurs: the case of the Mittelstand

This paper investigates the international entrepreneurial behaviour of Mittelstand firms (German small and medium sized enterprises). Analysis of a survey of the international marketing strategies of Mittelstand firms revealed three clusters of firms, two that had below and one above average international activities. None of the clusters displayed ‘born global’ type of internationalisation processes. However, this does not mean that they adopt passive approaches to internationalisation. The results suggest that Mittelstand firms engage in entrepreneurial behaviour that is proactive and innovative but which is cautious, sequential, and risk adverse. The implications of this analysis for future research in the area of international entrepreneurship are considered.

Employment in host regions and foreign direct investment

This paper examines the relationship between foreign direct investment inflows and employment using international business strategy literature to identify the factors influencing the development of subsidiaries that might affect employment growth in host regions. A survey of German subsidiaries in North West England is used to test the significance of the variables that are identified as likely to affect employment. The results of logit regression indicate that entry mode, technology transfer, and firm age affect the growth of employment. The study also highlights that other factors, such as sector, organisational structure, the level of diversification of operations by subsidiaries in the local economy, and range of markets supplied may have important affects on employment. The research indicates that further conceptual and empirical work is required to clarify our understanding of how the organisational, operational, and diversification characteristics of subsidiaries affect employment.

Foreign direct investment and employment in host regions

Investigates the role of direct foreign investment (DFI) in promoting employment in host regions in the European Union (EU). A theoretical framework is developed which suggests that the initial impact of DFI on employment is likely to be small and mainly linked to the creation of low skilled jobs with the loss of employment in host economies due to the displacement of domestic output by increased exports from the parent companies of subsidiaries. However, in the longer term, DFI flows should diversify the operations of subsidiaries thereby inducing a change in the pattern of jobs in host regions. The framework is assessed using evidence from a survey of German subsidiaries in north‐west England. Concludes with some policy implications and a future research agenda to expand and develop knowledge in this area.

Institutions and Joint Ventures in the Mid dle East and North Af rica: The Case of Jor dan

Abstract Many Mid dle East ern and North Af ri can (MENA) coun -tries are mak ing val iant ef forts to re form their eco nomic sys tems to boost growth and liv ing stan dards. Mul ti na tional Com panies (MNCs) are generally thought to have a ma jor part to play in help ing these coun tries to de velop. The prob lems caused by gov ern men tal sys tems that placed legal and bu reau cratic ob sta cles and pro hi bi tions in the way of For eign Direct In vest ment (FDI) ac tiv i ties are un der at tack in many coun tries. The World Bank (WB) and the In ter na tional Mon e tary Fund (IMF) in sist on the adop tion of busi ness-friendly pol i cies for those coun tries that seek their aid. More over, mem ber ship of the World Trade Or ga ni za tion (WTO) also re quires coun tries to re form their gov ern men tal sys tems. The prize at the end of the pain ful re form pro cess is higher growth of ten driven by FDI ac tiv i ties. In re cent years, FDI to de vel op ing and for mer com mu nist coun tries has con sid er ably in creased. How ever, some de vel -op ing coun tries (no ta bly, Af rica and large parts of the Mid dle East) have not bene fited to the same ex tent as many Asian and Cen tral and East Euro pean coun tries. More over, MNCs have fo cused on In ter na tional Joint Ven tures (IJVs) as the main means of en ter ing these coun tries. This form of en try may not be the best method to trans fer tech nol ogy and to ob tain the best re sults of the in ter ac tion be tween MNCs and host coun tries. This pa per seeks to ex plore this is sue by use of a qual i ta tive study of IJVs in Jor dan. The pa per uses a new in stitutional eco nomic framework that high lights the im por tance of in for mal in sti tu tional sys tems for the de cision on mode of en try. The re sults of the study in di cate that MNCs in Jordan would pre fer to use fully-owned sub sid iar ies, but the char ac ter is tics of the in for mal in sti tu tional sys tem in Jor dan re sults in high trans ac tion costs that can best be re duced by the use of IJVs. Thus al though Jor dan has un der gone sig nif i cant re form to her eco nomic sys tem, the prob lems caused by the na ture of in for mal in sti tu tional sys tems have lim ited the growth of what might have been more ben e fi cial FDI. [Ar ti cle cop ie s available for a fee from The Haworth Doc u ment De liv ery Ser vice

The use of contractual working time flexibility by Spanish SMEs

This paper investigates the use of contractual working flexibility (temporary and part‐time contracts) by Spanish small and medium sized enterprises (SMEs). A framework based on a contingency approach is used to identify variables that influence contractual working flexibility and is used to put forward a number of propositions and hypotheses that are tested using data collected from a survey of 602 Spanish SMEs. One‐way ANOVA analysis results reveal significant relationships between the level of contractual working flexibility and industry, life cycle, level of uncertainty, technological system, age, size and human resources practices. These findings are used to construct profiles of SMEs in relation to use of high and low levels of contractual working flexibility. The results suggest that various contingency factors as well as uncertainty, lead SMEs to develop different usage of contractual working flexibility.