Dancing with Gorillas: How Small Companies Can Partner Effectively with MNCs

by Julian Birkinshaw, Shameen Prashantham

Fall 2008

Volume 51
Issue 1

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A number of small enterprises are affected – often in dramatic ways – by the increasing presence of MNCs in their home markets. Small enterprise often find themselves facing a very difficult set of choices as they consider whether and how they should engage with the MNCs in their local market. The purpose of this paper is to evaluate the strategies smaller enterprises are adopting in a globalizing world. We suggest that a primary way for them to globalize successfully is through partnerships with local MNC subsidiaries – in their own backyard – which they can subsequently leverage to generate opportunities on a global scale. We develop a framework to help smaller enterprises think through the key steps that are needed to form, consolidate, and then extend their relationships with MNCs in the local market. In particular we emphasize that small enterprises must use to their advantage the points of difference (i.e., asymmetry) between them and MNCs to engage effectively with MNC partners.

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