The Brazilian Multinationals' Approaches to Innovation

Abstract Brazilian multinationals, born in a country where the environment is non-conducive to the scientific breakthrough type of innovation so stimulated in other countries, are increasingly expanding in international markets, where innovativeness is an intrinsic component of competitiveness. Aiming to study Brazilian multinationals' approaches to innovation, a new analytical framework was developed assuming that the internationalization process relies on the firm's innovative capability. In turn, innovative capabilities are derived from core competences and competence formation at firm level is influenced by the characteristics of the national environment. A survey involving 61 Brazilian multinationals led to the identification of four approaches to innovation, the competences that enable each one of them and the country-of-origin effects over competence development. That led to the explanation of why firms that do not show the expected strength in R&D, but are able to combine skillfully their organizational competences, manage to develop innovative capabilities which allow them to internationalize successfully. The overall outcome suggests that the dynamic relationships among institutions – competences – innovation – internationalization are setting new grounds for the international expansion of Brazilian firms.

[1]  C. Pérez.  A Vision for Latin America: A resource-based strategy for technological dynamism and social inclusion , 2008 .

[2]  L. Krajewski,et al.  Operations Management , 1994 .

[3]  S. Winter.  Understanding dynamic capabilities , 2003 .

[4]  K. Peter Kuchinke,et al.  Leadership styles and cultural values among managers and subordinates: a comparative study of four countries of the former Soviet Union, Germany, and the US , 2002 .

[5]  James M. Utterback,et al.  A dynamic model of process and product innovation , 1975 .

[6]  John Child,et al.  The Internationalization of Chinese Firms: A Case for Theoretical Extension? , 2005 .

[7]  Conceptualizing Brazilian Multiple and Fluid Cultural Profiles , 2006 .

[8]  Gary A. Knight,et al.  International business competence and the contemporary firm , 2009 .

[9]  Paulo N. Figueiredo,et al.  Discontinuous innovation capability accumulation in latecomer natural resource-processing firms , 2010 .

[10]  B. Elango,et al.  The influence of “country of origin” on multinational corporation global strategy: A conceptual framework , 1999 .

[11]  R. Vernon.  International investment and international trade in the product cycle , 1966 .

[12]  James M. Utterback,et al.  Mastering the Dynamics of Innovation: How Companies Can Seize Opportunities in the Face of Technological Change , 1994 .

[13]  Haritha Saranga,et al.  Catch-up strategies in the Indian auto components industry: Domestic firms’ responses to market liberalization , 2012 .

[14]  Amrik S. Sohal,et al.  TQM and innovation: a literature review and research framework , 2001 .

[15]  D. Teece,et al.  DYNAMIC CAPABILITIES AND STRATEGIC MANAGEMENT , 1997 .

[16]  R. Mudambi,et al.  Institutions and internation business: a theoretical overview , 2002 .

[17]  D. Samson,et al.  DEVELOPING INNOVATION CAPABILITY IN ORGANISATIONS: A DYNAMIC CAPABILITIES APPROACH , 2001 .

[18]  T. Koc,et al.  Factors impacting the innovative capacity in large-scale companies , 2007 .

[19]  Afonso Fleury,et al.  The relevance of subsidiary initiatives for Brazilian multinationals , 2009 .

[20]  Kim B. Clark,et al.  Architectural Innovation: The Reconfiguration of Existing Product Technologies and the Failure of , 1990 .

[21]  J. Mathews.  China, India and Brazil: Tiger technologies, dragon multinationals and the building of national systems of economic learning , 2009 .

[22]  Vijay Govindarajan,et al.  Reverse innovation, emerging markets, and global strategy , 2011 .

[23]  R. Narula,et al.  Multinational Enterprises and Local Contexts: The Opportunities and Challenges of Multiple Embeddedness , 2011 .

[24]  C. Prahalad,et al.  The Core Competence of the Corporation , 1990 .

[25]  Ram Mudambi,et al.  EMNE catch‐up strategies in the wind turbine industry: Is there a trade‐off between output and innovation capabilities? , 2012 .

[26]  Afonso Fleury,et al.  Brazilian Multinationals: Competences for Internationalization , 2011 .

[27]  Daphne W. Yiu,et al.  The Choice Between Joint Venture and Wholly Owned Subsidiary: An Institutional Perspective , 2002, Organ. Sci..

[28]  John Bessant,et al.  Managing Innovation: Integrating Technological, Market, and Organizational Change, 2nd Edition , 2001 .

[29]  A. Madhok,et al.  Acquisitions as Entrepreneurship: Asymmetries, Opportunities and the Internationalization of Multinationals from Emerging Economies , 2010 .

[30]  David J Sternberg,et al.  Strategic innovation. , 2021, Marketing health services.

[31]  P. Walgenbach,et al.  *Global Standardization of Organizational Forms and Management Practices? What New Institutionalism and the Business-Systems Approach Can Learn from Each Other , 2007 .

[32]  D. North.  Institutions, Institutional Change and Economic Performance: Economic performance , 1990 .

[33]  G. Hamel,et al.  Competence-based competition , 1994 .

[34]  John Child,et al.  Corporate Co-Evolution: A Political Perspective , 2008 .

[35]  Mauricio Mesquita Moreira,et al.  Fear of China: Is There a Future for Manufacturing in Latin America? , 2004 .

[36]  Faïz Gallouj,et al.  Innovation in services , 1997 .

[37]  Cipriano Forza,et al.  Survey research in operations management: a process‐based perspective , 2002 .

[38]  G. Hamel.  Strategy Innovation and the Quest for Value , 1998 .

[39]  D. Leonard-Barton.  CORE CAPABILITIES AND CORE RIGIDITIES: A PARADOX IN MANAGING NEW PRODUCT DEVELOPMENT , 1992 .

[40]  Renée Mauborgne,et al.  Blue ocean strategy. , 2004, Harvard business review.

[41]  T. Pedersen,et al.  Reconceptualizing the Firm in a World of Outsourcing and Offshoring: The Organizational and Geographical Relocation of High-Value Company Functions , 2010 .

[42]  Bruce Kogut,et al.  Country capabilities and the permeability of borders , 1991 .

[43]  J. Mathews.  Dragon multinationals: New players in 21st century globalization , 2006 .

[44]  R. Nelson,et al.  National Innovation Systems , 1993 .

[45]  Stephen Tallman.  Managing across Borders: The Transnational Solution , 1990 .

[46]  L. V. D. Heyden,et al.  Toward a Theory of Business Model Innovation within Incumbent Firms , 2009 .

[47]  M. T. Fleury,et al.  Development of non‐local competences in foreign subsidiaries of Brazilian multinationals , 2011 .

[48]  Preet S. Aulakh,et al.  Institutional changes and organizational transformation in developing economies , 2008 .

[49]  Jean Nollet,et al.  Issues on partnering: evidences from subcontracting in aeronautics , 2001 .

[50]  S. Winter,et al.  An Evolutionary Theory of Economic Change.by Richard R. Nelson; Sidney G. Winter , 1987 .

[51]  Alain Verbeke,et al.  Re-Conceptualizing Bartlett and Ghoshal's Classification of National Subsidiary Roles in the Multinational Enterprise , 2011 .

[52]  Gary P. Pisano,et al.  The Development Factory: Unlocking the Potential of Process Innovation , 1996 .

[53]  J. Sengupta.  Theory of Innovation , 2014 .

[54]  C. Bartlett,et al.  Creation, Adoption and Diffusion of Innovations by Subsidiaries of Multinational Corporations , 1988 .

[55]  Rosalie L. Tung,et al.  International expansion of emerging market enterprises: A springboard perspective , 2007 .

[56]  Ming Zeng,et al.  Dragons at Your Door: How Chinese Cost Innovation Is Disrupting Global Competition , 2007 .

[57]  F. Borini,et al.  A relevância das iniciativas de subsidiárias para as multinacionais brasileiras , 2009 .

[58]  R. Mudambi.  Location, Control and Innovation in Knowledge-Intensive Industries , 2008 .

[59]  C. Bartlett,et al.  Managing across Borders: The Transnational Solution , 1990 .

[60]  S. Athreye,et al.  Internationalization and technological leapfrogging in the pharmaceutical industry , 2009 .

[61]  Rosario Rogel Salazar,et al.  Red de Revistas Científicas de América Latina y el Caribe, España Portugal (Redalyc) , 2014 .