Drawing the Pieces Together

Abstract

Since the basic concern of strategy is to maintain and enhance firm performance (Rumelt, Schendel, & Teece, 1991), the logic that underpins the relatedness of a firm’s activities has become a central issue to both researchers and managers (Rumelt, 1974; Wrigley, 1970). While a great deal is known about the impact of diversity on firm outcomes, many important questions remain unresolved. This book has, therefore, addressed the question of how various elements of diversity are related to MNC economic performance by adding three new concepts while controlling for major alternative explanations. One of the new ideas tested in this book is whether the construct of geographic diversity can and should be separated into the more meaningful and precise concepts of international asset dispersion and country environment diversity. The second new idea is to determine to what extent network diversity has an impact on the performance of large MNCs.