A Firm's Resources, Diversification Strategy, Entry Mode and Performance

Multinational corporations (MNCs) base their Foreign Direct Investment (FDI) decisions on a wide range of interests and a variety of complex objectives. These decisions are characterized by considerable uncertainty and risk, and by the trading-off among corporate objectives. Choosing the appropriate entry mode is one of the important decisions in FDI to ensure a successful international investment expansion. Once any entry decision has been made, it is impossible to make changes without considerable loss of time and money since every entry mode has varying degree of resource commitment. Thus it is important to analyze whether a particular entry mode used by MNCs is enhancing their performance. This book should be advantage to firms in making entry mode decision upon their existing resources and international expansion strategy. The findings of important firm's characteristics needed to be considered in entry decision adds useful information for MNCs. The findings also reminds the MNCs of different entry modes with different control level on firm's operation results different performance level during economic up and down turns.