Uncommoditizing strategies by emerging market firms

Abstract

Purpose This paper aims to analyze how emerging market firms upgrade their capabilities by focusing on “uncommoditizing strategies” that enable them to achieve levels of international competitiveness beyond the comparative advantages of their home countries and serve markets with premium pricing, quality and reputation of products. Design/methodology/approach In this paper, the authors studied 18 Latin American companies across six countries. Latin America represents an ideal setting because many of these countries have traditionally developed using natural resource endowments, and their firms have tended to rely on these in their internationalization. To facilitate the analysis of each case and the comparisons across cases, the authors used the same analytical framework for the companies, identifying the sources of differentiation and cost efficiency strategies that enabled these firms to upgrade their capabilities and compete on the basis of premium pricing, quality and reputation. Findings The analysis identified a general framework that represents an abstraction of the actions taken by these companies over time. The proposed model consists of three main elements used to pursue uncommoditizing strategies: tropicalized innovation, global efficiency and coordinated control. Originality/value Recent research on emerging market firms has shown interest in how these firms upgrade their capabilities. This paper contributes to this stream of research by providing an overarching framework that not only bridged previous narrower studies but also explained how firms can develop uncommoditizing strategies to upgrade their capabilities. Further, this paper helps managers by providing a comprehensive yet succinct overview of the main strategies that they can use to help their firms to achieve international competitiveness.

Risk Perception in the Internationalization of Brazilian Companies: An Analysis in Different Entry Modes

“…Entry modes, which are part of the internationalization strategy, depend on the characteristics and objectives established by the company that seeks such expansion. Considering that the internationalization process is involved in the interaction of a company's operations with the foreign market, internationalized organizations adopt different strategies to achieve their needs and objectives (Cuervo-Cazurra et al, 2019).…”

“…Internationalization processes may differ from each other and have their characteristics; however, they need to be consistent with the company's organizational structure and with the objectives intended for the overseas expansion. Therefore, the main entry modes adopted, according to the analyzed literature, refer to exports, licensing, franchising, associations and strategic alliances, joint ventures, and installation of subsidiaries (Cuervo-Cazurra et al, 2019). Table 1 presents in more detail the main entry modes observed in the literature related to internationalization.…”

“…The international business scenario, especially regarding the last two decades, saw the growing expansion of companies from emerging countries operating abroad (Ahmed & Bebenroth, 2019). These are companies with little tradition of operations outside their countries of origin and known as late movers since, in countries with higher economic development, more intense engagement movements for internationalization were made already in the middle of the 20th century (Cuervo-Cazurra et al, 2019). Brazil, along with other emerging nations, fits into this context, which brings up the contemporary nature of this investigation.…”

Presencia internacional y sostenibilidad en mercados emergentes: grupo Nutresa hacia un liderazgo global

“…Las compañías multinacionales de América Latina se están convirtiendo en actores globales en diferentes industrias en el mundo (Cuervo-Cazurra et al, 2018). Ramamurti y Singh ( 2009) argumentan que los últimos años se han caracterizado por un aumento en el número de multinacionales de países emergentes como en los casos de México y Brasil.…”

How Hiring Financial Advisors in Cross-Border Acquisitions in The BRICS is Driven by The Target Country Institutional Image and Home-Target Distance

“…Integrating the resource-based view and the country-of-origin literature to view the country of origin as a resource, explaining the advantage (disadvantage) of foreignness, the relative benefit (liability) a subsidiary of a foreign firm enjoys over domestic firms when its country of origin is liked (disliked) by individuals in the host country (Cuervo-Cazurra & Un, 2015;He & Zhang, 2018). Finally a study was made to complete the analysis how emerging market firms upgrade their capabilities by focusing on "uncommoditizing strategies" that enable them to achieve levels of international competitiveness beyond the comparative advantages of their home countries and serve markets with premium pricing, quality and reputation of products (Cuervo-Cazurra et al, 2019).…”