Strategizing and Economizing in Global Strategy

Christian Geisler Asmussen, Nicolai J. Foss*

*Corresponding author af dette arbejde

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

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Abstrakt

Research summary
The strategic management and international business fields have followed, in some respects, quite similar intellectual trajectories, as reflected in the push for a field of “global strategy.” However, a key distinction in the strategy literature—namely, Williamson's distinction between “strategizing” and “economizing”—has not been explicitly recognized in the international business/global strategy fields. We argue that progress can be made in global strategy by recognizing this distinction and exploring the interaction between “strategizing” and “economizing.” To lend credence to this claim, we offer a simple model of the entry decision which highlights both economizing and strategizing aspects of this decision. We also offer recommendations on economizing-strategizing research in global strategy.

Managerial summary
Multinational enterprises gain competitive advantage either by improving the efficiency with which they operate (by having unique resources, lowering costs, or improving managerial practices) or by exercising their market and bargaining power. Most research has emphasized the former source of competitive advantage. However, in actuality, the two sources are intertwined. We detail how they are intertwined by means of a simple numerical example of the entry decision facing a company that can choose between competing or collaborating with the local firm. We show that strategizing plays into the entry decision in this case.
OriginalsprogEngelsk
TidsskriftGlobal Strategy Journal
Vol/bind12
Udgave nummer3
Sider (fra-til)578-591
Antal sider14
ISSN2042-5791
DOI
StatusUdgivet - aug. 2022

Bibliografisk note

Published online: 16 May 2022.

Emneord

  • Economizing
  • Global strategy
  • Strategizing
  • The entry decision

Citationsformater