The Dynamic Capabilities of Meta-Multinationals

• Published in: Global strategy journal 2016-08, Vol.6 (3), p.211-224
• Main Authors: Lessard, Donald, Teece, David J., Leih, Sohvi
• Format: Article
• Language: English
• Subjects: competitive advantage; dynamic capabilities; location and capability development; meta-multinationals; theory of the MNE
• ISSN: 2042-5791; 2042-5805
• DOI: 10.1002/gsj.1126

Plain language summary Today's multinational enterprises (MNEs) exhibit characteristics that have not been discussed very much in previous studies. They are stateless in the sense that operations are spread across nations, but also maintain some central authority. We call such MNEs ‘meta‐MNEs’ and analyze them using the Dynamic Capabilities framework, a key framework in strategic management. We find that the capability of MNEs to shape and adapt to changing environments is necessary for the emergence and success of the meta‐MNE. We also discuss prospects for meta‐MNEs in the context of China. Technical summary Established theories of the multinational enterprise (MNE) were created for a different, less globally competitive world. Today's MNEs are moving toward the stateless ideal type known as a metanational. Because considerable central authority remains, we call the emerging model the meta‐MNE and use the Dynamic Capabilities framework to analyze this phenomenon. Strong dynamic capabilities, including asset orchestration, are necessary both for the very existence of the meta‐MNE and for sustaining its competitive advantage. We draw contrasts between the meta‐MNE and the traditional, home‐centric MNE. We consider the ways in which nations still matter and the policy implications of the emergence of the meta‐MNE. We also discuss recent developments in China that have greatly shaped the environment facing existing and future meta‐MNEs. Copyright © 2016 Strategic Management Society.