Patterns of Internalisation by Larger Indian Firms: Emerging Evidence

Abstract

"Internationalization" and "globalization" are two words which have caught the fancy of managers, policy makers and management academics in India during the last four years following the adoption of the New Economic Policy by the Government of India in mid-1991. These two words which would be used interchangeably in this paper refer to the movement of a firm outside the boundaries of the country. Seen in a systemic perspective outward movement can embrace one or more of each of the systemic components of a firm; acquisition of resources; transformation of resource into outputs; and disposal of the firm's outputs (Chaudhuri an Khandwalla, 1985). Thus internalization at the enterprise level involves some or all of the following: products and services; export of technology; investments in foreign countries which may include setting up of marketing, distribution and servicing facilities in foreign countries that may be wholly owned or in partnership with foreign partners; establishment of manufacturing facilities, which again could be wholly owned or in partnership or collaboration with foreign partners; shopping globally for technologies just for the domestic market but export; inducting into the organization suitable technical and managerial personnel and management practices from abroad.