Mats Forsgren

The Concept of Learning in the Uppsala Internationalization Process Model: A Critical Review

In behavioral models dealing with the internationalization process, such as the Uppsala Internationalization Process Model, knowledge and learning have a profound impact on how the firm is seen to approach foreign markets. In the light of recent work on learning in organizations, this paper addresses some issues related to how the process of learning is conceptualized in the Uppsala Model. It is argued that a more narrow interpretation of learning is applied by the model builders than the literature allows for, which limits the ability of the model to explain certain forms of internationalization behavior. It is also claimed that perceiving a firm to be a loosely coupled organization causes some problems in relation to the model’s possibility to predict internationalization behavior. The consequences of the strong emphasis on individuals as the holders of market-specific knowledge are also discussed. The paper concludes with some remarks on the emergence of interesting research issues about internationalization behavior if a broader concept of organizational learning is applied.

Nordic International Business Research. A Review of Its Development

Abstract This article identifies the specific characteristics of Nordic international business research by analyzing how Nordic researchers over time have perceived and conceptualized their research object, “the international firm.” Their perceptions about essential features of the international firm are arguably reflected in their theoretical and empirical work on the internationalization of the firm and the management of the international firm.

Subsidiary performance in multinational corporations: the importance of technology embeddedness

Subsidiaries have access to different types of resources and therefore perform differently in their market-place and within a multinational corporation (MNC). Yet, even though subsidiaries are the object of intense interest, remarkably little has been written about the assessment of subsidiary performance. In short, the strategic opportunities of subsidiaries seem to generate more attention in the literature than their results. The two distinctive features of this paper are the development of the concept of subsidiary performance and the exploration of the linkage between subsidiary business context and performance. More specifically, by drawing on the literature about organizational learning, absorptive capacity and embeddedness in business relationships, some hypotheses will be formulated about the causal link between subsidiary environment and subsidiary performance. These hypotheses are then tested in a LISREL model based on data concerning 98 subsidiaries belonging to Swedish MNCs. Our empirical results indicate that technology embeddedness has a positive, direct, impact on subsidiary market performance, and a positive, but indirect, impact on subsidiary organizational performance.

Managing the international multi-centre firm: Case studies from Sweden

The traditional theory of foreign direct investment is inadequate to explain the latest phase of the internationalization of Swedish industry. The theory does not recognize that the factors which motivate firms new to the foreign scene differ considerably from those relevant to already highly internationalized firms. The latter no longer rely on any home-based strengths. Mats Forsgren also argues that most of the literature on the management of international firms puts too much stress on hierarchies. This hierarchical view of things is not appropriate to many international forms which have changed from a centre-periphery to a multi-centre structure, with foreign subsidiaries not only developing their own objectives but their own powerful resources. In this paper an alternative model is developed which categorizes these firms as heterogeneous and political systems in a network context rather than as homogeneous and hierarchically controlled systems. The article concludes by spelling out the implications of taking such a view on the management of international firms.

Centres of Excellence in Multinational Companies: The Case of Denmark

An important body of literature on multinational corporations (MNCs) relates to how they are organised, and especially the role of the subsidiaries within the organisation. (see Doz and Prahalad, 1981; Egelhoff, 1988; Bartlett and Ghoshal, 1989; Forsgren, 1989; Ghoshal and Nohria, 1989; Ghoshal and Bartlett, 1990; Gupta and Govindarajan, 1991, 1994; Forsgren and Johanson, 1992.) One theme in recent writings is the need to change from a situation of the firm as a bundle of headquarters-subsidiary relationships into a more complicated system with reciprocal interdependencies between units in different countries (Hedlund, 1986, Bartlett et al., 1990). Connected with this view is the assumption that the competitiveness of the modern MNC is characterised by a shift away from the initial stage of proprietary knowledge and brand labels to the exploitation of international activities through economies of scale and scope, learning and operating flexibility (Kogut, 1990).

Knowledge, Networks and Power — The Uppsala School of International Business

In the early 1960s, Sune Carlson, who came to the new Department of Business Studies after staying 10 years in the UN, started a research program on international business. The initiation of this program was considered against the background of the accelerating European economic integration that was expected to have important consequences for different segments of Swedish industry. Another important factor was that after World War II, many US companies entered European markets, thereby changing the international markets where Swedish firms operated. A number of young doctoral students were engaged in international business research projects. Some of these concerned the international operations of various Swedish industries, such as the special steel industry and the pulp and paper industry. Other projects concerned specific kinds of international business decisions, such as foreign direct investment by Swedish firms, foreign firms’ investments in Sweden or Swedish firms’ establishment of sales subsidiaries abroad. A common characteristic of the studies was a strong empirical orientation. Important research questions were “How do the firms compete in foreign markets?” “How are they organized?” “What are the important problems they face when going abroad?” “How do they adapt to changing competition in their markets?” etc. Evidently, these questions were relevant for the firms.

The development of international business: A narrative of theory and practice

No abstract available.

A Commentary on Adam Smith and International Business

A close reading of Adam Smith’s works, “An Inquiry into the Nature and Causes of Wealth of Nations” and “The Theory of Moral Sentiments,” indicates that he would not support the advocacy of free markets wholeheartedly. His view on market systems, although “free,” implies strong institutions and regulations. Adam Smith would have been particularly concerned with the fact that the large multinationals are as much political actors as they are economic actors. He would have argued that there may be ‘moral‘ limits to globalization. In his view, the general rules of morality are (in modern parlance) ‘socially embedded.’ Thus, sympathy and fellow‐feeling mostly operate at ‘close quarters’ and, in particular, they may not be effective at a transnational level.

Book Reviews : C. A. Bartlett, Y. Doz and G. Hedlund (eds.): Managing the Global Firm 1990, London and New York: Routledge. 363 pages:

Leopold; Wilson and Peel; Bruce, Buck, Coyne and Wright; and Felstead). The first three contributions deal with some of the complex relations between employees’ financial participation, their commitment to their firm, and the firm’s performance. They are all three based on empirical data from a large number of firms. One of the studies casts doubt on the idea that schemes have any major impact on employees’ attitudes, the two other studies demonstrate that there is a correlation