Multinational companies can successfully navigate local rules by employing tactics such as avoiding, altering, adapting, imitating, influencing, and innovating to maintain competitive advantage without jeopardizing operational integration.
The tension between leveraging local adaptations and maintaining a coherent international strategy underscores the need for multinational firms to evaluate their approach to local markets carefully.
Research reveals that while adapting to local regulations may mitigate liabilities of foreignness, it can simultaneously threaten the multinational’s advantage derived from global integration.
Executives must balance respect for local institutions with the preservation of their firm's integrated operations across markets to avoid compromising their international competitive strategy.
#multinational-companies #local-rules #competitive-strategy #international-business #strategic-management
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