Global Strategy and MNC Capabilities

29 Pages Posted: 25 May 2021 Last revised: 3 Jun 2021

See all articles by Donald R. Lessard

Donald R. Lessard

Massachusetts Institute of Technology (MIT) - Sloan School of Management

D. Eleanor Westney

York University - Schulich School of Business

Date Written: May 4, 2021

Abstract

Strategy in a global setting involves competition in industries that extend across national boundaries and among firms with different national home bases that may tap into strategic resources in more than one location. The resources that the firm accesses from its home country provide it with international competitive advantage only if they are relevant in other markets, if they are transferable in those markets, and if the value created from international expansion is appropriable. These resources include tangible assets and factors of production, but importantly also the capabilities the firm develops. Similarly, the resources that it taps from other contexts provide it with further competitive adnate only if these resource are more complementary to the firms exiting resources, transferable to the locations where it can exploit them, and appropriable. The resulting RAT and CAT tests provide a framework for international strategic decisions with an emphasis on developing, acquiring, and transferring capabilities.

Keywords: global strategic analysis, multinational firm, MNC capabilities, MNC organization, MNC orchestration, RAT/CAT framework

Suggested Citation

Lessard, Donald R. and Westney, D. Eleanor, Global Strategy and MNC Capabilities (May 4, 2021). MIT Sloan Research Paper No. 6429-20, Available at SSRN: https://ssrn.com/abstract=3850229 or http://dx.doi.org/10.2139/ssrn.3850229

Donald R. Lessard (Contact Author)

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

100 Main Street
E62-460
Cambridge, MA 02142
United States
617-253-6688 (Phone)
617-258-6617 (Fax)

D. Eleanor Westney

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
15
Abstract Views
130
PlumX Metrics