Conclusions: Upgrading Capabilities to Build an Emerging Market Multinational

Abstract

This chapter explains how the lessons derived from the analysis of Mexican multinationals, MultiMexicans, in a variety of industries contribute to a better understanding of the strategies used by emerging market firms to upgrade capabilities and internationalize. The chapter explains two main lessons. First, the process of upgrading capability to build an emerging market multinational, and the role played by the characteristics of the home country. The underdevelopment of the country and its institutional weakness influence managers’ skills and mindsets and the industry’s regulation and customer characteristics, thus supporting the funds and technologies available to firms. These, in turn, influence the firm’s capability upgrading and their internationalization speed and breadth. Second, the four alternative upgrading strategies for internationalization that emerging market firms use: Improvement, whereby firms upgrade processes at the local level; Integration, whereby firms upgrade processes at the global level; Inspiration, whereby firms upgrade products at the local level; and Innovation, whereby firms upgrade products at the global level.

Keywords: multinational firms, emerging markets, Mexico, emerging market multinationals, internationalization, capability upgrading, strategy

JEL Classification: F23, M2