Functional language of Japanese MNCs: A predetermined construct or aproduct of deliberate selection?

Heejin Kim (Tohoku University)
Abstract

How a functional language in MNCs is chosen? Is it a predetermined construct or a productof deliberate selection? As existing studies focusing on European and North American MNCs
tend to view the choice as a product of deliberate choice, there are scarce researches on alanguage choice of Asian MNCs. With 41 cases of Japanese MNC’s functional language useand two in-depth case studies to understand why they choose a certain language, this studyaims to understand the logics of Asian MNCs’ functional language choice. Analysis results
show that for Japanese MNCs, a functional language choice is a predetermined construct
rather than a product of deliberate choice, as Japanese is used in subsidiaries of three Asiancountries (China, Korea, and Taiwan), and English in other countries. Especially, Japanese
language is chosen for knowledge transfer to overseas subsidiaries of strategic importance.
This study contributes to language researches in IB providing empirical evidences onJapanese MNCs.

Keywords
functional language choice, Japanese MNCs, knowledge transfer, manufacturing, productdevelopment, Asian MNCs, case study approach.

1Resource Repositioning Capability as an International Marketing Strategy

Tetsuya Usui (Nihon University)
Abstract

The purpose of this study is to understand how firms utilize their home-based resourcesto achieve value in the foreign markets that they have entered. Previous studies haveproceeded on the premise that firms that have been established in the home market have asense of superiority that helps them develop positional advantage over local competitors inforeign markets. Firm specific advantage (FSA) has been considered to automatically create
value in foreign markets. This happens when firms internalize their activities and assets byexecuting a series of foreign direct investments. This is why the main focus in earlier studies
in international business has constantly been mechanisms supporting the existence ofmultinational corporations as a medium for efficient overseas transfer of home-basedresources. This is known as transaction cost minimization.
However, from an international marketing standpoint, the main issue here is not costefficient transfer of home-based resources. Rather, the issue is whether market value reallyexists or not. On the one hand, why is a certain home-based resource becoming a value
achieving FSA in the host market, and on the other hand, why is it not possible to utilize
other home-based resources as FSAs? This is a strategic marketing issue that remains to beexplored before investigating its other implications. This study investigates how a firm
identifies non-location bound-FSA (NLB-FSA) to achieve value for customers in hostmarkets in the initial market entry stage, and, which conditions enable home-based resources
to become NLB-FSAs in host markets. Through exploratory case studies of eight Japanesefirms across industries, such as cosmetics, apparel, retail, and restaurant industries, we
inductively identified a dynamic selection process to determine which home-based resources
are to be transferred as NLB-FSAs.
Our qualitative data lead to two findings. First, there are dynamic competitive market
effects on resource reconfiguration in host markets. The resources and bundles of resources
are tailored for specific market conditions, including customer preferences and competitor
skills. Therefore, home-based resources may be repositioned differently in host markets interms of customer perceived preferences and rarity. Second, in the initial resource transfer
process, only resources that have both, high customer perceived preference and rarity in thehost market, can be chosen to become NLB-FSAs. Our data from all those eight firms clearlyshow us that a firm is forced to develop and maintain a resource repositioning capability as aninternational marketing strategy in the initial market entry stage, in order to build competitive
advantage over local competitors.
Keywords: resource, firm specific advantage, marketing capability, international marketing,and Japanese MNCs

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New developments in IB theory: revisiting O and L advantages
Rajneesh Narula (Reading University)

Abstract

There are three variations of the ‘Reading School’ theories of international business: theinternalisation theory version pioneered by Buckley and Casson, the eclectic paradigm byDunning, and the ‘new internalisation theory version by Rugman and Verbeke. I willsummarise and explain the primary current developments in conceptualisation in theseconceptual frameworks, highlighting changes in our understanding of three things: 1. How O
advantages (FSAs) are understood, 2. How location advantages are understood; 3. How
Dunning’s FDI motives have been revised.

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