Abstract
Purpose: This paper contributes to the discussion of the effects of the global financial and economic crisis of 2008-09 (GFEC) on strategies of multinational companies (MNC) in the unique regional context of Central and Eastern Europe (CEE).
Methodology/approach: The considerations are based on secondary data and accessible studies dealing with corporate responses to the recent economic downturn.
Findings: The author argues that the business model which guided the expansion into CEE still remains valid. The huge market potential did not disappear and the advantages stemming from a skilled workforce and favorable resource situation were not eliminated by the crisis. What markedly changed is the perception of risk of doing business in CEE. As a consequence, foreign investors follow a more cautious and selective approach in their regional strategy. Regional players will try to stay in CEE and benefit from the exit of weaker competitors. Multi-tier brand strategies and affordability initiatives will gain in importance.
Research limitations/implications: As this is a discussion paper further research is necessary to validate the propositions.
Practical implications: An external shock such as the recent crisis forces management to conduct a comprehensive review of the pillars of their strategy. This paper offers a guideline for review of a regional strategy.
Originality/value of paper: The paper provides a comprehensive review of the business model for CEE in the light of the recent global crisis and highlights probable strategic responses of foreign MNCs.
Keywords: Central and Eastern Europe, Economic crisis, Multinational company, Regional strategy, Strategy review.
Paper type: Conceptual paper
Methodology/approach: The considerations are based on secondary data and accessible studies dealing with corporate responses to the recent economic downturn.
Findings: The author argues that the business model which guided the expansion into CEE still remains valid. The huge market potential did not disappear and the advantages stemming from a skilled workforce and favorable resource situation were not eliminated by the crisis. What markedly changed is the perception of risk of doing business in CEE. As a consequence, foreign investors follow a more cautious and selective approach in their regional strategy. Regional players will try to stay in CEE and benefit from the exit of weaker competitors. Multi-tier brand strategies and affordability initiatives will gain in importance.
Research limitations/implications: As this is a discussion paper further research is necessary to validate the propositions.
Practical implications: An external shock such as the recent crisis forces management to conduct a comprehensive review of the pillars of their strategy. This paper offers a guideline for review of a regional strategy.
Originality/value of paper: The paper provides a comprehensive review of the business model for CEE in the light of the recent global crisis and highlights probable strategic responses of foreign MNCs.
Keywords: Central and Eastern Europe, Economic crisis, Multinational company, Regional strategy, Strategy review.
Paper type: Conceptual paper
| Originalsprache | Englisch |
|---|---|
| Titel des Sammelwerks | Progress in International Business Research - Volume 7: New Policy Challenges for European Multinationals |
| Herausgeber*innen | Rob Van Tulder, Alain Verbeke, Liviu Voinea |
| Erscheinungsort | Bingley |
| Verlag | Emerald Group Publishing |
| Seiten | 393 - 419 |
| ISBN (Print) | 978-1-78190-020-8 |
| Publikationsstatus | Veröffentlicht - 2012 |