The Challenges of International Trade to U. Technology Policy D C. M OWERY No observer of recent developments in the trade and investment relationships among the industrial and industrializing nations of the world can fail to be struck by the extent to which trade and investment flows, and the foreign and domestic public policies affecting them, now influence the technology development and investment decisions of U.
Page 56 Share Cite Suggested Citation: The Internationalization of U. The National Academies Press. Success requires that quality, cost, service, and value be truly world class, regardless of the size of the firm or type of industry. A number of factors can be identified that have become essential to the competitiveness of U.
Though specific steps needed to maintain global competitiveness will vary by company, the following themes can be applied across the board as the foundation of corporate and national success in the internationalization process.
The fundamental importance of profitability in the U. In this light three other characteristics can be linked to corporate success in the international environment.
First, the firm must maintain control of corporate destiny by retaining control of the core capabilities necessary to support a strong long-term presence in its chosen markets and technologies.
Second, the firm must be able to benefit from changes in technology, indus- trial structure, and other significant events. Third, the firm must nurture the stakeholders in the business, including employees, suppliers, customers, 41 42 communities, and shareholders.
A manufacturer that can achieve these objectives and maintain long-term profitability will benefit from the inter- nationalization process. The challenge is to use internationalization as a tool to strengthen the firm's abilities in these areas.
Corporate Imperatives Drawing on its research, observations, and experience in interna- tional manufacturing, the committee identified several factors necessary for long-term success in the emerging global marketplace.
As usual, specific implementation steps vary, but the concepts apply universally. Develop necessary managerial capabilities Fostering international experience should be made an explicit part of management development planning. Despite the impact of international- ization on the broad base of U.
A few multinational companies emphasize foreign expenence, but too many firms retain a culture that both discour- ages foreign assignments and fails to take advantage of foreign management experience.
Such a practice should be applied, at a minimum, to manufacturing and marketing managers since the need to recognize customers' needs in diverse global markets and respond to them quickly and effectively will be prerequisites to corporate success.
Broader experience in international operations is not the only need in management development. Steps are also needed to improve the manage- ment of technology in U.
Again, some firms are very good at developing, acquiring, and leveraging technological assets, but, overall, technology management remains a weakness. Managers need to do a better job of.
Accumulate and exploit key competitive capabilities Given that resources such as funds, talent, technologies, distribution networks, and marketing information are becoming both equal and mo- bile among international competitors, the only viable route to long-term success is to develop proprietary competitive capabilities that allow the firm to perform critical activities better and faster than the competition.
Key competitive capabilities encompass an array of tangible and intangible strengths that build on each other and provide the ability to create innova- tions, to take advantage of them rapidly, and to respond to the challenges of competitors by quickly introducing products of competing cost, quality, and functionality.
These strengths stem from a combination of technology, corporate organization, and collective learning abilities that are difficult to imitate because they are deeply imbedded in the firm.
For example, 3M Corporation applies its expertise in substrates and coatings to create a leading position in businesses ranging from magnetic tape to masking tape.
Honda considers strong capabilities in internal combustion engine techno- logy to be critical to the global success of its businesses.
Casio uses its proficiency in miniaturization across an expanding product line? In the current manufacturing environment of rapid technology flows, high investment costs, and global competition, the ability to accumulate and strengthen key competitive capabilities is typically beyond the capacity of in-house resources.
Managers must explicitly assess the capabilities the firm has today, which of them will be critical in the future, and what other capabilities need to be built or acquired to ensure long-term competitiveness.
A critical question is which capabilities must be retained, practiced, and owned by the firm and which can be obtained from outside. The answer requires a holistic view of the firm's products, markets, and long- term strategy.
For instance, the decision to manufacture or buy a specific part cannot be based only on cost. It also requires an assessment of the part's importance to the final product; the importance of the final product to corporate success; opportunities to gain competitive advantage through improvements in the part; and the design, engineering, and manufacturing capabilities gained as a direct result of making that part.
Building a system of constant im- provement in manufacturing is an example of a core competitive capability that provides unique advantages. Such a system must include a process of benchmarking existing manufacturing capabilities against both competitors and emerging technological developments, creating an ability to absorb new 2This decision-making process is described extensively by Ira Magaziner and Mark Patinkin in The Silent War: Although deficiencies in the initial redesign led to compressor failures, necessitating purchases of compressors from outside suppliers while design corrections were made, the new manufacturing systems continue to perform well and General Electric has gained invaluable experience in mass producing extremely close tolerance parts.
This feedthrough should occur both hor- izontally and vertically. Horizontally, the interaction between design and manufacturing capabilities can be a strong basis for unique competitive ad- vantages: Vertically, manufacturing capabilities at the final product level drive capabilities at all the intermediate levels from subassemblies and parts to materials, tools, and methods.
The firms that are best at building key capabilities in man- ufacturing and integrating them horizontally and vertically throughout the firm will have a strong basis on which to build world-class competitiveness. Collect and exploit global intelligence A specific activity that U.Using this group of JVs, we determined whether the trading firm's JV partner's core business was closely related to the reported primary business of the JV itself; if so, we considered the primary role of the Japanese trading firm to .
International new ventures (INVs) have been documented to exist all around the world, but the literature is silent on the frequency of such companies in different countries.
Role of transnational corporations in the international trade Abstract The main aim of this paper is to assess the role of transnational corporations in the international trade.
Transnational corporations are the main players of the world economics. best results in international trade and are the top trading partners (see table 2). Table 2. Kim, T. () Globalization and Higher Education in South Korea – towards ethnocentric internationalization or global commercialization of higher education?
In King, R., Marginson, S. and. Since a long time, Japan has been having a prosperous economy, and trading and commercialization have played a significant role in the internationalization of Japan. Globalization and its attractiveness have affected many developed countries around the world, Japan being one of.
The results suggested a discrepancy between the direct and indirect influences of internationalization. On the one hand, there is an inverted U-shaped pattern in the direct relati.