Past, present and future of international business and management

THE PAST, PRESENT AND FUTURE
OF INTERNATIONAL BUSINESS &
MANAGEMENT


ADVANCES IN INTERNATIONAL
MANAGEMENT
Series Editors: Timothy Devinney, Torben
Pedersen and Laszlo Tihanyi
Recent Volumes:
Volume 12:

Edited by J. L. C. Cheng and R. B. Peterson

Volume 13:

Edited by J. L. C. Cheng and R. B. Peterson

Volume 14:

Edited by M. A. Hitt and J. L. C. Cheng

Volume 15:

Edited by J. L. C. Cheng and M. A. Hitt

Volume 16:

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Edited by Thomas Roehl and Allan Bird

Volume 18:

Edited by D. L. Shapiro, M. A. Von Glinow
and J. L. C. Cheng

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Volume 22:

Edited by Joseph L. C. Cheng, Elizabeth
Maitland and Stephen Nicholas


ADVANCES IN INTERNATIONAL MANAGEMENT
VOLUME 23

THE PAST,
PRESENT AND FUTURE
OF INTERNATIONAL
BUSINESS &
MANAGEMENT
EDITED BY

TIMOTHY DEVINNEY
University of Technology, Sydney, Australia

TORBEN PEDERSEN
Copenhagen Business School, Denmark

LASZLO TIHANYI
Texas A&M University, USA

United Kingdom – North America – Japan
India – Malaysia – China


Emerald Group Publishing Limited
Howard House, Wagon Lane, Bingley BD16 1WA, UK
First edition 2010
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in these chapters are not necessarily those of the Editor or the publisher.
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ISBN: 978-0-85724-085-9
ISSN: 1571-5027 (Series)

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CONTENTS
LIST OF CONTRIBUTORS

xi

EDITORS’ BIOGRAPHY

xvii

EDITORS’ INTRODUCTION

xix

SECTION 1

INTRODUCTION TO SECTION 1
BOOZ & CO./STRATEGY + BUSINESS
EMINENT SCHOLAR IN INTERNATIONAL
MANAGEMENT 2009
Timothy M. Devinney

3

FROM CULTURE AND BEHAVIOR TO
CULTURE AND SELF-DECEPTION
Harry C. Triandis

5

CULTURE, PSYCHOLOGY,
MANAGEMENT, AND HARRY TRIANDIS
P. Christopher Earley

15

SELF-DECEPTION AND THE IDEAL
CULTURE: IMPLICATIONS FOR
INTERNATIONAL MANAGEMENT
RESEARCH
Kwok Leung

23

v

vi

CONTENTS

SECTION 2
INTRODUCTION TO SECTION 2
THE PAST, PRESENT AND FUTURE OF
INTERNATIONAL BUSINESS &
MANAGEMENT
Timothy M. Devinney, Torben Pedersen and
Laszlo Tihanyi
SCIENTIFIC MINDFULNESS: A FOUNDATION
FOR FUTURE THEMES IN INTERNATIONAL
BUSINESS
Karsten Jonsen, Zeynep Aycan, Iris Berdrow,
Nakiye A. Boyacigiller, Mary Yoko Brannen,
Sue C. Davison, Joerg Dietz, Julia Gluesing,
Catherine T. Kwantes, Mila Lazarova, Svjetlana
Madzar, Mary M. Maloney, Martha Maznevski,
Edward F. McDonough, III, Sully Taylor,
David C. Thomas and Todd J. Weber

33

43

A. BEHAVIOR
BEHAVIORAL ELEMENTS IN FOREIGN
DIRECT INVESTMENTS

Yair Aharoni
EXPLORING THE ROLE OF MANAGERIAL
INTENTIONALITY IN INTERNATIONAL
BUSINESS
Thomas Hutzschenreuter, Un-Seok Han and
Ingo Kleindienst
THE PAST, PRESENT AND FUTURE OF
MANAGING DISTANCE: STAKEHOLDERS
AND DEVELOPMENT
Rob van Tulder

73

113

137


vii

Contents

B. CULTURE AND DISTANCE
CULTURAL INTELLIGENCE AND ALL
THAT JAZZ: A COGNITIVE REVOLUTION
IN INTERNATIONAL MANAGEMENT
RESEARCH?
David C. Thomas

169

WALKING THE CULTURAL DISTANCE:
IN SEARCH OF DIRECTION BEYOND
FRICTION
Rian Drogendijk and Lena Zander

189

SOFTWARE, DISTANCE, FRICTION, AND
MORE: A REVIEW OF LESSONS AND
LOSSES IN THE DEBATE FOR A BETTER
METAPHOR ON CULTURE
Brent Smith

213

THE LIABILITIES OF ORIGIN: AN EMERGING
ECONOMY PERSPECTIVE ON THE COSTS
OF DOING BUSINESS ABROAD
J. Ramachandran and Anirvan Pant

231

COUNTRY LEVEL CORRUPTION AS A
LIABILITY OF FOREIGNNESS: EFFECTS ON
STAFFING, INCENTIVES, AND ACTIVITIES
John M. Mezias and Stephen J. Mezias

267

LIABILITY OF FOREIGNNESS: NEW
INSIGHTS FROM CAPITAL MARKETS
R. Greg Bell, Igor Filatotchev and
Abdul A. Rasheed
INSTITUTIONAL DISTANCE IN
INTERNATIONAL BUSINESS RESEARCH
Jin-Hyun Bae and Robert Salomon

293

327


viii

CONTENTS

C. PEOPLE, SYSTEMS AND
ORGANIZATIONS
BUILDING COMPETITIVE ADVANTAGE
IN A GLOBAL ENVIRONMENT: LEADERSHIP
AND THE MINDSET
Shaista E. Khilji, Elizabeth B. Davis and Maria Cseh

353

TOP MANAGEMENT TEAMS AND SOCIETAL
CONTEXT: THE INTERNATIONAL
DIMENSIONS OF TOP MANAGEMENT
Rene´ Olie

375

MANAGING THE FRAGMENTED VALUE
CHAIN OF GLOBAL BUSINESS: EXPLOITATIVE
AND EXPLORATIVE OFFSHORING TOWARD
EMERGING MARKET ECONOMIES
Fiorenza Belussi and Silvia Rita Sedita

399

GLOBAL MARKETING STRATEGY:
PAST, PRESENT, AND FUTURE
Susan P. Douglas and C. Samuel Craig

431

D. INNOVATION AND KNOWLEDGE
TECHNOLOGICAL CLUSTERS AND
MULTINATIONAL ENTERPRISE R&D STRATEGY
Ram Mudambi and Tim Swift

461

MANAGEMENT INNOVATION AND
THE MULTINATIONAL CORPORATION
Michael J. Mol and Julian Birkinshaw

479

INNOVATION AND THE MULTINATIONAL
ENTERPRISE
Luis Vives, Kazuhiro Asakawa and Silviya Svejenova

497


ix

Contents

E. INTERNATIONALIZATION
A MULTILEVEL APPROACH TO UNDERSTANDING
THE MULTINATIONALITY–PERFORMANCE
RELATIONSHIP
Bo Bernhard Nielsen and Sabina Nielsen

527

NONLINEAR INTERNATIONALIZATION:
A NEGLECTED TOPIC IN INTERNATIONAL
BUSINESS RESEARCH
Tiia Vissak

559

F. EMERGING MARKETS
DIASPORAS AS DRIVERS OF NATIONAL
COMPETITIVENESS
Masud Chand

583

INTERNATIONALIZATION OF
EMERGING MARKET FIRMS:
A CASE FOR THEORETICAL EXTENSION
Ajai Gaur and Vikas Kumar

603

AUTHORS’ BIOGRAPHIES

629



LIST OF CONTRIBUTORS
Yair Aharoni

Faculty of Management, Tel Aviv
University, Israel

Kazuhiro Asakawa

Graduate School of Business
Administration, Keio University,
Yokohama, Kanagawa, Japan

Zeynep Aycan

Koc- University, Istanbul, Turkey

Jin-Hyun Bae

Stern School of Business, New York
University, New York, NY, USA

R. Greg Bell

Graduate School of Management,
University of Dallas, Irving, TX, USA

Fiorenza Belussi

Department of Economics and
Management, University of Padova, Via
del Santo, Padova, Italy

Iris Berdrow

Bentley University, Waltham, MA, USA

Julian Birkinshaw

London Business School, Regent’s Park,
London, UK

Nakiye A. Boyacigiller

Faculty of Management, Sabanci

University, Istanbul, Turkey

Mary Yoko Brannen

INSEAD Fontainebleau, France

Masud Chand

Barton School of Business, Wichita State
University, Wichita, KS, USA

C. Samuel Craig

Stern School of Business, New York
University, New York, NY, USA

Maria Cseh

George Washington University,
Washington, DC, USA

Elizabeth B. Davis

George Washington University,
Washington, DC, USA
xi


xii

LIST OF CONTRIBUTORS

Sue C. Davison

Pipal Ltd, Nairobi, Kenya

Joerg Dietz

Department of Organizational Behavior,
Faculty of Business and Economics,
University of Lausanne, Lausanne,
Switzerland

Susan P. Douglas

Stern School of Business, New York
University, New York, NY, USA

Rian Drogendijk

Department of Business Studies,
Uppsala University, Uppsala, Sweden

P. Christopher Earley

School of Business, University of
Connecticut, CT, USA

Igor Filatotchev

Sir John Cass Business School, City
University London, London, UK

Ajai Gaur

Department of Management and Global
Business, Rutgers Business School,
Newark and New Brunswick, Rutgers
University, Newark, NJ, USA

Julia Gluesing

Wayne State University, Detroit,
MI, USA

Un-Seok Han

WHU – Otto Beisheim School of
Management, Vallendar, Germany

Thomas Hutzschenreuter WHU – Otto Beisheim School of
Management, Vallendar, Germany
Karsten Jonsen

IMD, Lausanne, Switzerland

Shaista E. Khilji

George Washington University,
Washington, DC, USA

Ingo Kleindienst

WHU – Otto Beisheim School of
Management, Vallendar, Germany

Vikas Kumar

Faculty of Economic and Business,
University of Sydney, Sydney,
NSW, Australia

Catherine T. Kwantes

Department of Psychology, University of
Windsor, Windsor, ON, Canada


xiii

List of Contributors

Mila Lazarova

Simon Fraser University, Burnaby, BC,
Canada

Kwok Leung

City University of Hong Kong, Hong Kong

Svjetlana Madzar

Strategic Management Department,
Carlson School of Management, University
of Minnesota, MN, USA

Mary M. Maloney

University of St. Thomas, MN, USA

Martha Maznevski

IMD, Lausanne, Switzerland

Edward F.
McDonough, III

College of Business Administration,
Northeastern University, Boston, MA,
USA

John M. Mezias

School of Business Administration,
University of Miami, Coral Gables, FL,
USA

Stephen J. Mezias

The INSEAD Middle East Campus,
Abu Dhabi, United Arab Emirates

Michael J. Mol

Warwick Business School, University of
Warwick, Coventry, UK

Ram Mudambi

Department of Strategic Management,
Fox School of Business, Temple University,
Philadelphia, PA, USA

Bo Bernhard Nielsen

Center for Strategic Management &
Globalization, Copenhagen Business
School, Copenhagen, Denmark

Sabina Nielsen

Department of International Business and
Economics, Copenhagen Business School,
Copenhagen, Denmark

Rene´ Olie

Rotterdam School of Management,
Erasmus University Rotterdam,

Rotterdam, Netherlands

Anirvan Pant

Corporate Strategy & Policy Area, Indian
Institute of Management Bangalore,
Bangalore, Karnataka, India


xiv

LIST OF CONTRIBUTORS

J. Ramachandran

Corporate Strategy & Policy Area,
Indian Institute of Management Bangalore,
Bangalore, Karnataka, India

Abdul A. Rasheed

Department of Management, College of
Business, University of Texas at
Arlington, Arlington, TX, USA

Robert Salomon

Department of Management and
Organization, Stern School of Business,
New York University, New York, NY,

USA

Silvia Rita Sedita

Department of Economics and
Management, University of Padova,
Via del Santo, Padova, Italy

Brent Smith

St. Joseph’s University, Philadelphia,
PA, USA

Silviya Svejenova

Business Policy Department, ESADE
Business School, Ramon Llull University,
Barcelona, Spain

Tim Swift

St. Joseph’s University, Philadelphia,
PA, USA

Sully Taylor

School of Business Administration,
Portland State University, Portland, OR,
USA

David C. Thomas

Segal Graduate School of Business,
Simon Fraser University, Vancouver,
BC, Canada

Harry C. Triandis

University of Illinois, Champaign-Urbana,
IL, USA

Rob van Tulder

RSM Erasmus University Rotterdam,
Rotterdam, Netherlands

Tiia Vissak

Faculty of Economics and Business
Administration, University of Tartu,
Tartu, Estonia


xv

List of Contributors

Luis Vives

Business Policy Department, ESADE

Business School, Ramon Llull
University, Barcelona, Spain

Todd J. Weber

Department of Management, University
of Nebraska-Lincoln, NE, USA

Lena Zander

Department of Business Studies,
Uppsala University, Uppsala, Sweden



EDITORS’ BIOGRAPHY
Timothy Devinney is a professor of strategy at the University of Technology,
Sydney. Prior to that he was a professor and professorial research fellow at
the Australian Graduate School of Management (AGSM), director of the
Centre for Corporate Change and the AGSM executive MBA. Before
joining the AGSM, he held positions on the faculties of The University of
Chicago, Vanderbilt University, and UCLA and has been a visiting faculty
member at numerous universities in Europe (Copenhagen Business School,
Humboldt University-Berlin, Wirschaftsuniversitaăt Wien, and the Universities of Hamburg, Trier, Konstanz, Ulm & Frankfurt) and Asia (Hong
Kong University of Science and Technology & City University, Hong
Kong) and taught at many others (e.g., CEIBS, Helsinki University of
Technology & Helsinki School of Economics). He has published 7 books
and more than 80 articles in leading journals. In 2008, he was the first
recipient in management of an Alexander von Humboldt Research Award
and was Rockefeller Foundation Bellagio Fellow. He is a Fellow of the

Academy of International Business, an International Fellow under the
auspices of the AIM Initiative in the UK and a Fellow of ANZAM
(Australia New Zealand Academy of Management).
Timothy is heavily involved in the international networks of scholar. He
served as a chair of the International Management Division of the Academy
of Management. He is an associate editor of Academy of Management
Perspectives and the head of the International Business & Management
Network of SSRN. He ran the 2001 Academy of International Business
Conference in Sydney. He is on the editorial board of more than 10 of the
leading international journals.
Timothy’s degrees are: BSc (Magna Cum Laude – Psychology and
Applied Mathematics), Carnegie Mellon University; MA, MBA, PhD
(Economics), University of Chicago.
Torben Pedersen is a professor of international business at the Copenhagen
Business School’s Center for Strategic Management and Globalization. He
has published over 60 articles and books concerning the managerial and
strategic aspects of globalization. His research has appeared in prominent
journals such as Strategic Management Journal, Journal of International
xvii


xviii

EDITORS’ BIOGRAPHY

Business Studies, Journal of Management Studies, and Journal of Corporate
Finance. His research interests are located at the interface between strategy,
institutional economics and international business and with a strong interest
in areas like knowledge management, offshoring/outsourcing and reconfiguration of the value chain, subsidiary entrepreneurship and management of
the differentiated MNC. He is a co-editor of Global Strategy Journal and

serves on numerous editorial boards. He was AIB Program chair in 2009
and is currently vice president for AIB and vice chairman of EIBA
Laszlo Tihanyi is the B. Marie Oth associate professor in business administration in the Mays Business School at Texas A&M University, U.S.A. He
received a Ph.D. in strategic management from Indiana University and a
Doctorate in business economics from Corvinus University of Budapest in his
native Hungary. He is also an honorary professor at Corvinus University.
His main research areas are internationalization, corporate governance in
multinational firms, and organizational adaptation in emerging economies.
His current research interests include the involvement of board of directors
in foreign direct investment, the institutional environment of internationalization decisions, and the effects of social movements on multinational
firms. His papers have been published or are in press in the Academy of
Management Journal, Academy of Management Review, Strategic Management Journal, Organization Science, Journal of International Business
Studies, and others. He is an associate editor of the Journal of Management
Studies and serves as an editorial board member of the Academy of
Management Journal, Journal of International Business Studies, and Journal
of World Business.
Timothy Devinney
Torben Pedersen
Laszlo Tihanyi
Editors


EDITORS’ INTRODUCTION
This is the first volume of Advances in International Management under the
new editorial team of Timothy Devinney, Torben Pedersen and Laszlo
Tihanyi. We hope to continue the tradition established by our predecessors,
Joseph Cheng and Michael Hitt, and also will work to bring a new
perspective to the series. It is our intention to use the series less as a journal
or book series and more as a forum for ideas and discussion – a view that
builds on the tradition of the series but also aims to put it in juxtaposition to

traditional publication outlets.
Our first volume hints at a slightly different structure from the past.
The first part of volume 23 contains a perspective from Harry Triandis on
his life’s work with commentary from two of his students, Chris Earley and
Kwok Leung. Professor Triandis was the recipient of the 2009 Booz & Co./
strategy ỵ business Eminent Scholar in International Management Award,
given by the International Management Division of the Academy of
Management.
The second part of volume 23 focuses on the theme of the volume –The
Past, Present and Future of International Business & Management. This is a
critical topic for a field at the crossroads, a fact confirmed by the number of
journals that have recently published special retrospective and prospective
issues on international business and management. However, unlike these
issues, we did not have an open call for manuscripts and then subject them
to the traditional journal reviewing process. Instead, we went to three
groups of scholars – fellows of the various academies, dissertation
competition award winners and best paper prize award winners at the key
management and international conferences – with the intent of (a) giving the
authors the latitude to be more critical and controversial, subject to our own
review and (b) providing an opportunity for a balanced perspective that
gave more weight to junior scholars in the field. You can decide whether we
were successful at (a). However, when compared with these recent journal
special issues, it is clear that we have given considerably more voice to a
broader range of scholars both in terms of location, age/experience and
perspective.

xix


xx

EDITORS’ INTRODUCTION

In closing, we thank Rebecca Forster, Kim Foster and all the Emerald
editorial team for their patience and support. In addition, Lacri Nacu
provided critical editorial and administrative assistance in completing the
volume on time. Without this support the volume would still be in process!
Timothy Devinney
Torben Pedersen
Laszlo Tihanyi
Editors


SECTION 1



INTRODUCTION TO SECTION 1
BOOZ & CO./STRATEGY ỵ
BUSINESS EMINENT SCHOLAR
IN INTERNATIONAL
MANAGEMENT 2009
Timothy M. Devinney
The Booz & Co./strategy ỵ business Eminent Scholar in International
Management is an annual award given by the International Management
Division of the Academy of Management and Sponsored by Booz & Co./
strategy ỵ business.
The 2009 awardee was Professor Harry Triandis, Emeritus Professor at the
University of Illinois. Professor Triandis was recognized for his contribution
to the field of international management based upon his longstanding and

well-respected work in the field of cross-cultural psychology.
Professor Triandis received his Ph.D. in Social Psychology from Cornell
University in 1958 and spent the dominant proportion of his career at the
University of Illinois (joining in 1958). Since that time he has authored
dozens of books and hundreds of articles and stands as one of the most cited
scholars in the field of cross-cultural psychology. His work stands at the base
of much of the work linking social psychology and international management, particularly that examining different societal perceptions and attitudes.
He is a fellow of American Association for the Advancement of Science,
Divisions 8, 9 and 14 of the American Psychological Association and an
Honorary Fellow of the International Association of Cross-Cultural
The Past, Present and Future of International Business & Management
Advances in International Management, Volume 23, 3–4
Copyright r 2010 by Emerald Group Publishing Limited
All rights of reproduction in any form reserved
ISSN: 1571-5027/doi:10.1108/S1571-5027(2010)00000230039

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TIMOTHY M. DEVINNEY

Psychology. He has received many prestigious awards, including a Ford
Foundation Fellowship, a Guggenheim Fellowship and a Klineberg Award.
In the paper that follows, Professor Triandis outlines aspects of his thinking
throughout his life and closes with an overview of his most current work,
entitled Fooling Ourselves: Self-Deception in Politics, Religion, and Terrorism,
which applies his thinking to issues of modern society. In addition, two of the
Professors former students, Professor Chris Earley and Professor Kwok

Leung provide a synopsis of Professor Triandis’s contribution and impact to
the fields of social psychology and international management.


FROM CULTURE AND
BEHAVIOR TO CULTURE
AND SELF-DECEPTION
Harry C. Triandis
For most of my career I studied the relationship between culture and
psychological process, and the implication of such relationships for
managerial and other behaviors. That has certainly become an important
research area. Since I published my Individualism and Collectivism book
(Triandis, 1995), for instance, this topic has become important in the social
sciences. For example, the Kitayama and Cohen’s (2007) Handbook of
Cultural Psychology has many chapters that use some of that work. I assume
that the Academy has honored me for that work.
I continued doing some work in this area, such as a chapter on the history
of the study of the relationship between culture and psychology (Triandis,
2007), a chapter on culture theory in the Handbook of Social Psychological
Theories (Triandis & Gelfand, Forthcoming), and a chapter presenting
several hypotheses about factors that link ecology and culture (Triandis,
2009a).
The latter chapter has examined the ecological determinants of three
dimensions of cultural variation:
1. Cultural simplicity–complexity (Chick, 1997) that contrasts hunters and
gatherers with information societies, but is quite important because it
The Past, Present and Future of International Business & Management
Advances in International Management, Volume 23, 5–14
Copyright r 2010 by Emerald Group Publishing Limited
All rights of reproduction in any form reserved

ISSN: 1571-5027/doi:10.1108/S1571-5027(2010)0000023006

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