DYNAMIC PROCESSES OF INTERNATIONAL COMPETITION: WHY HAVE JAPANESE ELECTRICAL APPLIANCE COMPANIES BEEN OVERTAKEN BY KOREAN, TAIWANESE, AND CHINESE COMPANIES?

Abstract

　Japanese consumer electronics industry was highly competitive internationally from the 1980s to the early 2000s. But today Asian firms have already overtaken Japanese firms, at least in terms of sales and international market share. Why have Japanese firms been caught up and even overtaken by Asian latecomers such as Taiwanese, Korean, and Chinese firms? This paper addresses the following questions. How have Korean, Taiwanese, and Chinese companies accumulated the capabilities to compete with Japanese companies? What are the unique competitive actions of these firms? This paper analyzes the dynamic process of international competition between Japanese and Asian firms, based mainly on the results of field research we have conducted.

　Conventional theories of international management have focused primarily on the utilization of advantages and the creation of further advantages of developed country MNCs. International management research on Japanese firms, in particular, has focused on the transfer of advantages overseas and the corporate growth through the benefits associated with overseas management. In the course of such conventional research, Asian countries in which Japanese firms have expanded have been regarded mainly as markets or production bases, and competition with local Asian firms has been ignored. However, the static competitive environment is not constant. In the international business arena, the competitive environment changes dynamically, influenced by the specifics and circumstances of each country or region in which MNCs operate.

　In the past, the development of globalism has been viewed by Japanese firms as an opportunity to maintain and develop their competitive advantage under a static competitive environment. However, the international competitive environment is currently undergoing a major change as Korean, Taiwanese, and Chinese firms have achieved overtaking through the dynamic competitive process as we have seen in this paper.