Global Strategic Management: institutional influences on firms' value creation
On the topic of global strategic management, I explain how institutions affect firms’ capability upgrading and internationalization and, subsequently, value creation. This research stream started with my Ph.D. thesis at the Massachusetts Institute of Technology, in which I proposed that a coevolution of resources and scope in response to pro-market reforms helped firms become internationally competitive. This sparked my interest in how firms, especially emerging market ones, overcome contextual challenges and succeed.
My contributions can be grouped into two areas: capability upgrading and internationalization.
First, I explain how the institutional context of operation modifies the ways in which firms upgrade their technological capabilities. Earlier in my career, I studied research and development (R&D), proposing that the incentives to invest in R&D varied with the home country and firm conditions. Thus, I argued that regional economic integration agreements reinforced product but not factor market pressures on R&D investment ; that access to foreign technology led multinationals’ subsidiaries to reduce external but not internal R&D ; that existing knowledge resources led some firms to never invest in R&D; that R&D collaborations with universities, suppliers, customers, and competitors varied on their innovation impact, and that sources of funds altered these collaborations’ effectiveness. Building on these insights, I then studied how emerging market firms upgraded their technological capabilities despite the unsupportive home country innovation system. I proposed that such context altered innovation incentives, constrained absorptive capacity, changed learning-by-doing, and created informality costs. However, some firms built a frugality advantage and innovated to serve middle-of-the-pyramid consumers.
Second, following a similar logic, I explain how the home country’s institutional context affects internationalization, focusing on emerging market multinationals. I started this line by clarifying the drivers of the difficulties in internationalization and explaining how emerging market firms overcame such difficulties and succeeded. These insights on emerging market multinationals improved our understanding of home country contextual effects on internationalization. I explained how the underdevelopment of the home country influenced the country, entry mode, and non-sequential internationalization process used by emerging market multinationals. Going deeper into home-country institutions' role in internationalization, I proposed that emerging market firms built an institutional advantage at home that supported their foreign success because they learned to deal with underdeveloped institutions, pro-market reforms, and skepticism of globalization.
Global sustainable governance: incentives for societal value creation.
On the topic of global sustainable governance, I explain how incentives and norms drive firms’ value creation for society. My interest in this topic began with my doctoral studies at the University of Salamanca on how owners’ private objectives drove value creation.
I have developed two research lines, one on ownership and another on misbehavior.
First, I studied large owners’ effect on diversification and the worldwide diffusion of codes of good governance to modify incentives. I then focused on state-owned firms, explaining how politicians’ non-business objectives created disadvantages and advantages of stateness that shaped the state-owned firms’ foreign challenges and internationalization as they became tools of discreet power. Second, and bridging with my studies on emerging market firms, I analyzed how companies address host country corruption. I argued that corruption did not deter foreign investors from corrupt nations and that laws against bribery abroad were effective when implemented in multiple countries. I then expanded these ideas to study other types of misbehavior, and explained that firms in emerging markets undertake sustainability to overcome government failures and address unintended externalities, enabling them to benefit from such investments.