- 08 Apr 2010
- Working Paper Summaries
Multinational Strategies and Developing Countries in Historical Perspective
HBS professor Geoffrey Jones offers a historical analysis of the strategies of multinationals from developed countries in developing countries. His central argument, that strategies were shaped by the trade-off between opportunity and risk, highlights how three broad environmental factors determined the trade-off. The first was the prevailing political economy, including the policies of both host and home governments, and the international legal framework. The second was the market and resources of the host country. The third was competition from local firms. Jones explores the impact of these factors on corporate strategies during the three eras in the modern history of globalization from the nineteenth century until the present day. He argues that the performance of specific multinationals depended on the extent to which their internal capabilities enabled them to respond to these external opportunities and threats. The paper highlights in particular the changing nature of political risk faced by multinationals. The era of expropriation has, for the moment, largely passed, but multinationals now experience new kinds of policy risk, and new forms of home country political risk also, such as the Alien Tort Claims Act in the United States. Key concepts include: The strategies of multinationals in the developing world have changed over time. Initially they sought access to resources through exclusive contracts. As anti-globalization policies increased, they needed enhanced political contacts, and strengthened local managements. The pursuit of markets and lower cost labor is now the central focus. They still need local political and business contacts, but also have to respond to local competition and demands to incorporate local relevance into global products. Multinationals initially enjoyed insider advantages in colonial regimes. With decolonization, political risk rose sharply. They were often expropriated, and many divested. Now multinationals face regular, adverse shifts in policy by host governments. The recent period of globalization has also seen the growth of home country political risk. In particular, multinationals face criticism and legal action for real or alleged environmental or human rights abuses in developing countries. Developing countries, or at least the larger and more fast-growing ones in Asia and Latin America, are increasingly seen as indispensable by multinationals in every industry. However recent decades have seen a sharp growth of highly competitive local firms, who can compete with frugal engineering, and are going global. Closed for comment; 0 Comments.
- 07 Jul 2009
- Research Event
Business Summit: Historical Roots of Globalization
In this breakout session, panelists shared insights, informed by history, of the convergence that globalization promotes. Closed for comment; 0 Comments.
- 28 Aug 2008
- Sharpening Your Skills
Sharpening Your Skills: History Matters
Business history is a rich source of knowledge and inspiration for today's executives. Do we pay enough attention to the past? Here are four Working Knowledge articles that provide lessons from history about leaders, leadership, and business organization. Closed for comment; 0 Comments.
- 17 Mar 2008
- Research & Ideas
The Lessons of Business History: A Handbook
Compiling a handbook on the current thinking in any area of study seems daunting enough, but the just-published Oxford Handbook of Business History carries an even larger mission: bring the lessons of business history to current research in other disciplines and to the practice of business management itself. A Q&A with coeditor Geoffrey Jones. Key concepts include: Business historians over recent decades have generated rich empirical data on firms and business systems that can confirm or challenge many of today's fashionable theories and assumptions by other disciplines. Business history has broadened its scope in the last two decades by including research on corporate governance, industrial districts, business groups, business culture, business education, skills training, accounting and information systems, design, and engineering. Historical knowledge helps us to truly understand business, but the growing ahistorical nature of much management and economics literature has seriously compromised its legitimacy. The business history literature is extremely weak in Africa, and not much better in Latin America, many Asian countries, and the Middle East. Closed for comment; 0 Comments.
- 08 Aug 2006
- Working Paper Summaries
Managing Governments: Unilever in India and Turkey, 1950–1980
During the postwar decades, consumer-products giant Unilever survived and even thrived in developing countries such as India and Turkey even as business conditions discouraged or drove away peer companies. Why? At least five factors explain Unilever's ability and willingness to persist in such developing countries. These factors may also explain why foreign direct investment shrank to low levels in these countries, and has remained low. Key concepts include: Most important of all, Unilever became embedded in local business and political systems, functioning as a quasi-insider. Unilever held first-mover advantage. Unilever took a long-term investment horizon, believing that sooner or later as incomes rose people would want to consume its products. A decentralized management structure gave Unilever flexibility in adjusting to the different environments of developing countries. Localization of management provided a key competitive advantage. Unilever's policy of staying outside party politics meant that it had few enemies. Closed for comment; 0 Comments.
- 08 Aug 2006
- Working Paper Summaries
Entrepreneurship and Business History: Renewing the Research Agenda
This paper identifies major opportunities to raise entrepreneurship as a central research issue in business history and to build on the strong roots that are already in place in that discipline. Historical research on entrepreneurship began in the 1940s and 1950s, much of it at Harvard Business School, but then lost momentum. Nevertheless the paper shows the major achievements in exploring how context shaped the structure of entrepreneurship, and identifying the wide variation in organizational form and entrepreneurial behavior. It concludes with the main contributions of business history to the study of entrepreneurship, and proposes a renewed research agenda. Key concepts include: Business historians are uniquely situated to integrate social science research with studies of the special character of entrepreneurship. It is important to research the historical effect of culture and values on entrepreneurial behavior, using more careful methodologies than in the past. There are major opportunities to establish the precise relationship between institutions and entrepreneurial performance. Historical research may help management researchers to understand how entrepreneurship needs to be understood within the context of time and place. Context may matter as much as the characteristics and behavior of the entrepreneurs themselves. Closed for comment; 0 Comments.
- 11 Jul 2006
- Working Paper Summaries
Globalizing the Beauty Business Before 1980
Even six-month-old infants may understand what makes faces "attractive," regardless of ethnicity, but adults vary considerably in how they present themselves through clothes, hairstyles, and physical appearance. Studying the period from 1945 to 1980, this paper examines the drivers of the globalization of beauty; the strategies that firms employed to overcome challenges to globalization; and the outcomes, including the level to which globalization has brought about a homogenization of beauty ideals and practices. Key concepts include: Barriers were surprisingly strong between the U.S. and European consumer markets in the beauty industry. Large corporations struggled to succeed in the fashion-conscious hair care and cosmetics markets. By 1980, the globalization of beauty products was much more extensive in toiletries than in cosmetics. Globalization did not result in a pervading Americanization of global beauty. Closed for comment; 0 Comments.
- 10 Jul 2006
- Working Paper Summaries
Nationality and Multinationals in Historical Perspective
Many people believe that globalization has caused companies to lose their national identity. This study traces the history of corporations and nationality and finds that multinational companies have always had ambiguities, particularly before World War I. National subsidiaries became stronger in the twentieth century, and companies like Ford, for example, would feel very American in the United States, but have a more local identity in another part of the world. In the twenty-first century, globalization has caused a reemergence of issues concerning corporate nationality. However, this research shows that in many ways corporate affiliation with a country may matter more than ever. Key concepts include: The twentieth century brought an increase in international businesses with strong national ties. Today, corporate strategy, executive leadership, government relations, and brands rely heavily on location and geography. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Bringing History into International Business
International Business scholars often talk about history, but rarely take it seriously. The first generation of International Business scholars placed a high priority on evolutionary and historical perspectives and methodology, but little work these days grapples with the history of International Business or uses historical data to explore an issue. Jones and Khanna discuss new avenues for researching business groups in history and in contemporary emerging markets, resource-based and path-dependent theories of the firm, and foreign direct investment and development over time. Key concepts include: Move beyond assertions that "history matters" and explore how it matters. Longitudinal analysis is important. History can be treated as rigorously as conventional statistical analysis, and should be. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Schumpeter’s Plea: Rediscovering History and Relevance in the Study of Entrepreneurship
Academic studies of entrepreneurship have focused on people and firms but ignored the context of history. The result is an over-reliance in the experiences of high-tech start-ups in the U.S., leading to generalizations using empirical evidence from an exceptional and atypical industry and location. Economist Joseph Schumpeter believed the study of entrepreneurial behavior made little sense without the equal study of the broader industrial, social, and economic setting in which they operated. An exchange between historical and social scientific approaches will yield far richer understanding. Key concepts include: The lessons we are learning from studies of entrepreneurship are incomplete, lacking the perspective of historical context. Closed for comment; 0 Comments.
- 28 Nov 2005
- Research & Ideas
Unilever: Transformation and Tradition
In a new book, professor Geoffrey Jones looks at Unilever's decades-old transformation from fragmented underperformer to focused consumer products giant. This epilogue summarizes the years 1960 to 1990. Closed for comment; 0 Comments.
- 22 Aug 2005
- Research & Ideas
Restoring a Global Economy, 1950–1980
In his recent book Multinationals and Global Capitalism, professor Geoffrey Jones dissects the influence of multinationals on the world economy. This excerpt recalls the rebuilding of the global economy following World War II. Closed for comment; 0 Comments.
- 03 May 2004
- Research & Ideas
Business History around the World
One way to understand management trends and ideas today is to look at yesterday. HBS entrepreneurship professor Geoffrey G. Jones and co-editor Franco Amatori have done just that with their new book, Business History around the World. Closed for comment; 0 Comments.
- 09 Dec 2002
- Research & Ideas
UnileverA Case Study
As one of the oldest and largest foreign multinationals doing business in the U.S., the history of Unilever's investment in the United States offers a unique opportunity to understand the significant problems encountered by foreign firms. Harvard Business School professor Geoffrey Jones has done extensive research on Unilever, based on full access to restricted corporate records. This recent article from Business History Review is the first publication resulting from that research. Closed for comment; 0 Comments.
- 02 Sep 2002
- Research & Ideas
Foreign Multinationals in the U.S.: A Rocky Road
Why do many of the world’s leading multinationals experience managerial and performance problems in the United States? The answers, as offered by Harvard Business School professor Geoffrey G. Jones, provide lessons for all companies operating on foreign soil. Closed for comment; 0 Comments.
- 11 Mar 2001
- Research & Ideas
Merchants to Multinationals: British Trading Companies in the Nineteenth and Twentieth Centuries
It was a business world defined by globalization and growing interdependency. But it's not international trade circa 2000. As HBS professor Geoffrey Jones points out, the "global economy" first emerged in the 1870s. Closed for comment; 0 Comments.
The History of Beauty
Fragrance, eyeliner, toothpaste—the beauty business has permeated our lives like few other industries. But surprisingly little is known about its history, which over time has been shrouded in competitive secrecy. HBS history professor Geoffrey Jones offers one of the first authoritative accounts in Beauty Imagined: A History of the Global Beauty Industry. Closed for comment; 0 Comments.