Date of Award
Doctor of Business Administration (DBA)
Dr. Lance E. Brouthers
Dr. George E. Nakos
Dr. Steve Werner
Are there strategies that domestic transitional economy firms (TEFs) can use in order to be successful given the increasing numbers of multinational enterprises (MNEs) operating in their home country markets? How do domestically focused, small and medium-sized enterprises (SMEs) in developed economies maintain satisfactory levels of performance when faced with the superior resources of MNEs and the resulting increased competitiveness in domestic industrial markets?
I attempt to answer these two questions in two separate papers. In the first paper, I examine TEFs by using research on the knowledge-based view of the firm (KBV) to create and test a new theory based on the advantages that domestic TEFs enjoy, due to the superior local market knowledge that comes from being local or indigenous. This new theory, called the Advantages of Indigenousness (AOI), suggests that local firms in transitional economies can develop strategies based on their indigenousness that will result in improved performance. I test this new theory on a sample of Romanian firms, examining three specific AOI based strategies, and find some empirical support for the theory.
In the second paper, I examine domestic manufacturing SMEs in a developed economy to see if their superior local market knowledge provides a source for niche strategies that enhance performance. Based on the KBV, I hypothesize that domestic SMEs which use superior local market knowledge to develop niche strategies perform better than SMEs that do not. To test these hypotheses, I use primary data collected from manufacturing SMEs in the U.S. An empirical analysis lends credence to my claim that superior local market knowledge can be used to create niche strategies that result in improved performance.