A dual Canadian and German citizen, Andreas Schotter is an Assistant Professor of International Business and the Faculty Director of Ivey’s MSC in Management program. He also serves as Ivey’s Academic Director of the CEMS Global Alliance Masters in International Management program. Dr. Schotter has lived in Canada, Europe, Asia and the USA and holds permanent resident status in Hong Kong. As an international business expert he helps executives and organizations understand the challenges and opportunities posed by the ever increasing turbulences in the global economy. He specializes in how to think strategically and drive the agile decision-making that will prevail in today’s volatile, uncertain, complex, and ambiguous business world. His current areas of endeavour include the development of strategies for business system disruption and investigations into boundary-spanning leadership capabilities in global organizations. Dr. Schotter’s research has been published in leading academic and practitioner journals including the Academy of Management Journal, the Journal of International Business Studies and the MIT Sloan Management Review amongst others. He has authored numerous book chapters, cases, and a book on strategic management frameworks. In addition to his academic work Dr. Schotter collaborates closely with leading multinational corporations from North America, Europe, Asia, the Middle East and Latin America on emerging market strategies and international leadership development.
Before embarking on an academic career Dr. Schotter was a senior executive with several multinational corporations in the luxury consumer goods, automotive and industrial equipment industry. He was the Asia Pacific Regional Managing Director for Bitzer International, a leading manufacturer of commercial HVAC equipment headquartered in Germany. He also worked as General Manager for Linde AG in China and in various executive functions for Volkswagen and the Lancaster Cosmetics Group.
Dr. Schotter holds a Masters in Economics and Business Management from the University of Kassel, Germany and both an Executive MBA and a Ph.D. from Ivey. Prior to joining Ivey as a faculty member in 2013, Dr. Schotter taught at the Thunderbird School of Global Management in Arizona, where The Wall Street Journal recognized him twice as a “WSJ Distinguished Professor of the Year.” A hockey enthusiast and passionate rower, he represented his native Germany internationally at Rowing World Championships.
Teaching
Global Strategy (MBA)
Ivey Global Lab (MSC)
CEMS Block Seminar (MSC)
Education
Master in Business Economics, University of Kassel, Germany
Abstract: We show how the initial subnational entry location of foreign multinational enterprises (MNEs) in China influences their subsequent within-country location choices and expansion speed. We distinguish between MNEs that establish their first subsidiary in co-ethnic cores—dense agglomerations of other firms from the same country of origin—and MNEs that locate their first subsidiary in the periphery, i.e., outside of these co-ethnic cores. To identify co-ethnic cores in China, we employ a geo-visualization methodology, which draws the boundaries of cores organically and dynamically over time. We contrast our findings with the prevailing approach of using static administrative boundaries for identifying agglomerations. Our results provide evidence of path dependency, in that (a) entry through subnational locations with strong co-ethnic communities is followed by expansion into other locations where co-ethnic communities are present, and that (b) entry through co-ethnic communities accelerates the pace at which MNEs establish additional subsidiaries in China. We also find that co-ethnic community effects continue to influence within-country MNE activities over time, despite a host of economic, institutional, and investment developments.
Abstract: We respond to calls for advances in the contextualization of international business (IB) research by introducing interactive visualization as a methodology for generating contextual insights during the exploratory phases of IB research projects. We suggest that applying interactive visualization early on improves contextualization by means of simultaneous dynamic representations of various phenomena and their respective properties and relationships, even for phenomena that have been widely researched before, like in the cases of international joint ventures and MNE foreign direct investment. The goal of this introduction is to make interactive visualization more accessible to IB scholars.
Abstract: This research examines region-bound headquarters disaggregation in multinational enterprises (MNEs). We link the formation of regional management centers—both dedicated regional headquarters (RHQs) and regional management mandates (RMMs) granted to operating subsidiaries—to the complexity argument underlying organizational information processing theory. We demonstrate how different dimensions of complexity associated with the number and dispersion of an MNE’s subsidiary network in a focal region affect whether, and in which form region-bound headquarters disaggregation takes place. Additionally, we consider boundary conditions affecting RMC formation based on within-region experience, global MNE footprint, and between-region effects. Empirically, we utilize a large global dataset of Japanese MNE foreign investment for the period from 1992 to 2014, which allows us to perform longitudinal event history analyses.
Abstract: Prior research into the effects of cultural differences between MNE home and host countries on expatriate staffing decisions in foreign subsidiaries has produced a large number of conflicting findings. We address some of these conflicting findings and aim to advance theory in two ways. First, we draw on transaction cost economics to explain why and how the effects of cultural distance on the proportion of expatriate parent-country nationals form a curvilinear instead of a linear relationship, as commonly proposed. Second, we integrate the values-based cultural distance concept with the norms-based tightness-looseness concept. This allows us to simultaneously account for cultural differences between countries and location-bound normative cultural effects within countries, which cannot be overcome solely through expatriate learning and adaptation. Using a large global dataset of Japanese MNEs, we find support for a convex relationship between cultural distance and the proportion of expatriate parent-country nationals. We also find a moderating (steepening) effect of tightness-looseness on this relationship. The results reconcile some of the tensions between the subjectivists' values-based approach, which positions culture in the shared cognitions realm, and the structuralists' approach, which places culture in a normative situational environment.
Abstract: Global organizations are inherently complex. The spatial dispersion of activities results in organizational subunits becoming embedded in local host-country contexts that differ from their parents’ home country contexts. These subunits are also embedded in their parents’ corporate networks, causing them to differ from their locally embedded peers. The dual embeddedness and associated complexities create complex and often implicit boundaries. In addition, the contextual and operational diversity that affects the boundaries in global organizations are continually changing. Hence managing and coordinating across different inter- and intra-organizational boundaries has emerged as an important capability for the success of global organizations. So far, we have a limited understanding of the factors that affect the complexity and effectiveness of the boundary spanning function. In this article, we focus on clarifying these key issues and propose a model for effective boundary spanning in global organizations.
Abstract: India will soon be the world’s most populous country. Today, it boasts a sophisticated service sector with a highly trained, English-speaking workforce. What is less well known, is that India has also developed a large number of supplier firms in the manufacturing sector, many of which are capable of integrating into the most advanced supply chains in the world. However, India’s undoubted challenges have ensured that it is so far largely untapped by foreign multinational enterprises. Many executives still dismiss India due to insufficient scale in their target customer segments, which is needed to support more complex value-adding activities. By so doing, they perhaps miss the biggest opportunity of the coming decades. Those foreign firms that have entered India have mainly adopted one of two distinctive strategies. Some, like Unilever, have focused inward and developed capabilities for making money through low cost, locally embedded processes and products. Others, like IBM, have primarily used India as an offshore source for low cost skilled-service labor to complement global operations. Our research suggests that combining these two approaches offers the key to unlocking India’s enormous economic potential. By interweaving these two strategies, multinationals can create what we call a mutually reinforcing Make-In-India Helix that generates superior returns locally and globally. Creating the Helix involves simultaneously taking advantage of local sourcing, manufacturing, and marketing activities in conjunction with local adaptation of global products to generate mutually reinforcing advantages. The Helix enables firms to achieve local/global product-portfolio ambidexterity for reaching successfully across all of India’s income segments, while at the same time developing a springboard for global exports. The result is the necessary localization required to achieve scope and scale advantages in India, while leveraging these advantages in form of cost-effective solutions for global markets.
Abstract: In multinational enterprises (MNEs), regional management centres (RMCs) most frequently take the form of either dedicated regional headquarters (RHQs) or regional management mandates (RMMs) assigned to operating subsidiaries. We identify a series of critical differences in characteristics and performance between RHQs and RMMs, using a longitudinal sample of 855 Japanese RMCs across 41 countries. We also investigate parent-level differences between MNEs with distinct RMC configurations. We propose a structural complement to regional strategy extensions of the integration-responsiveness framework, and provide an important large sample baseline, aiding new theoretical and empirical research into MNE regional management strategy and structure.
Abstract: Intellectual property (IP) protection is the No. 1 challenge for multinational corporations operating in China. According to the U.S. government, China accounted for nearly 80% of all IP thefts from U.S.-headquartered organizations in 2013, amounting to an estimated $300 billion in lost business. Among European manufacturers, the loss of IP in China reduced potential profits by 20%.The effects from IP leakage in China are ubiquitous. They are visible in counterfeited items including toys, luxury goods, automotive and aircraft parts, pharmaceuticals and other complex high-tech products. But IP violations go beyond products. They extend to pirated operational processes and the replication of entire business and service models.
Although multinational corporations can’t afford to stay away from China, in order to remain competitive they must develop mechanisms that enable them to shift some of their innovation capabilities to China safely, without losing critical know-how. To learn about how companies are managing the China IP protection challenge, we studied more than 50 multinational corporations. We identified nine IP protection practices that can be used as a web of protection including (1) Developing strategic clarity; (2) Collecting business intelligence; (3) Following legal fundamentals; (4) Creating interest alignment; (5) Disaggregating processes; (6) Implementing a controls discipline; (7) Creating dynamism; (8) Managing human resources strategically and; (9) Engaging in focused corporate social responsibility activities. These practices allow corporations to expand faster within China and across other emerging markets while enhancing local and global innovativeness, which leads to improved performance.
Abstract: As we transition toward a worldwide knowledge economy, where and how innovation gets done is shifting dramatically. Leading innovators have learned to leverage elite talent in networked knowledge clusters around the world including places like Shanghai, Bangalore, Rio de Janeiro, Cairo, Tel Aviv and Saigon. No longer do the US, Japan and Western Europe remain dominant sites for innovation; instead emerging markets play an increasingly more important role in the knowledge creation activities of multinational enterprises (MNE). Consequently, many MNEs have shifted away from centralized R&D to new forms of knowledge creation—including offshoring, outsourcing, and networking, and this particularly in industries where talent-related challenges threaten innovation success. The fieldwork underlying our study showed that successful networked innovators create talent architectures to grow, share and exploit strategically mindshare—the aggregated exploitable sum of what individual knowledge workers know and how they use this knowledge. The combined global mindshare of talented employees creates crucial levels of innovation and economies of ideas, the basic building blocks of knowledge based competitiveness. We looked at people practices in innovation networks to identify what leading networked innovator organizations do to achieve success in the knowledge economy.
Abstract: Until recently, corporations have taken mostly reactive positions on climate change by applying mitigation and adaptation strategies in response to eminent political or actual physical risks to their businesses. Few corporations have taken a pro-active, opportunity-seeking strategic approach to improve competitiveness over and above the mitigation and adaptation requirements set by policymakers, industry norms, or shifting consumer preferences. Considering that the climate change discussion no longer focuses on whether or not human activities have an impact on the changing climate, or how much impact they have, corporations should now focus on how to maximize competitiveness based on the actual and predicted climate change effects. The purpose of the current special issue is to stimulate an interdisciplinary, integrated discussion across a wide range of issues related to climate change and multinational corporations, including: 1.) Are adaptation and mitigation actions are complementary and mutually achievable? 2.) How can or do MNCs capitalize on this synergy? 3.) How do MNCs assure visibility and influence with regulatory decision makers in formulation of policy? 4.) How should return on investment (ROI) in adaptation and mitigation be measured? – What are the appropriate metrics? 5.) How do MNCs influence relevant stakeholders and bring them into the climate strategy process? 6.) What are current best practices in pro-active climate strategy that go beyond adaptation and mitigation? Is there room for arbitrage?
Abstract: The global economic crises that began in 2008 had profound effects on the supply chains of many multinational firms across all industries including altering some fundamental supply chain characteristics. This study discusses the effects of the crises on lower-level supply chain members in the context of the textile and garment industry in emerging markets. The fieldwork for this research and the integration of new United Nations data provide evidence for the vulnerability of those supply chain members that provide only commoditized basic services that do not depend on talent skills or resource availability. Most of these, less sophisticated supply chain members are located in non ‘BRIC’ emerging economies including Vietnam, Bangladesh, Pakistan, Haiti, Honduras etc. We present a framework that is transferable across industries. The framework is useful for managers when evaluating the feasibility and reliability of different suppliers from emerging and developing countries in particular.
Abstract: This study investigates the widely overlooked phenomenon of MNE location avoidance, utilizing a multi-method research design and data on 131 foreign investment locations. It complements economic choice based location research by adding contextual dimensions at the country level that matter to managers personally and affect decisions at the firm level. We provide a connection between international business research, the behavioral stream in economic geography and the micro-foundations stream in the strategic management literature. The results suggest that in addition to traditional location choice criteria (including investment potential, internationalization strategy, and various geographic and psychic distances), foreign location decisions in MNEs are influenced by how troublesome it is for managers to travel to or live in certain places. An eleven-item measure composed of travel inconveniences shows a significant negative moderating effect on the relationship between foreign direct investment potential and investment intensity. The effect is stronger for non-resource-seeking industries. We call this phenomenon the “Hassle Factor.”
Abstract: Favors are a medium of exchange for social capital. Social capital creates social, political, and economic benefits for individuals, organizations, communities, and societies around the world. Favors promote cooperation between individuals and are used to bond individual actors with other individuals, groups, communities, and institutions. Favors are prevalent in business in emerging markets because of the presence of institutional voids, limited social and geographic mobility, and strong reciprocity norms. Favors create benefits and liabilities for business organizations and their networks. They produce outcomes beyond the favor exchange process that can be characterized as productive or perverse. Despite their prevalence and importance, favors and their dynamics are not well understood. We explore the antecedents, content, process, and consequences of favors. We conclude our multi-level analysis of favors with a discussion of the “breakeven” point for favors—the point where favors tip from having a positive effect to having a negative effect on organization performance. We present an integrated framework to explain the dynamics of favors in emerging market business contexts, and develop propositions to guide future research.
Abstract: While scholarly attention to the role played by diasporans in facilitating cross-country trade has recently increased, the implicitness of this phenomenon has prevented many researchers from examining empirically how these processes actually work. Unlike previous studies that focus on diasporans from specific countries of origin, we take a different perspective on diasporans by looking beyond country boundaries. We focus on religious/cultural groupings, specifically on Muslim diasporans living in the West. We utilize a phenomenological driven qualitative research approach to investigate the effects of Muslim diasporans on the internationalization processes of firms from Organization of Islamic Conference countries in the context of the halal industry. Our exploratory study provides some evidence for (1) the boundary spanner roles played by Muslim diasporans within the halal industry across more than dyadic country contexts and (2) for Rahnema's (2006) triple identity theory.
Abstract: Recent research suggests that both the scholarly and the managerial perspectives on intra-organizational conflict in multinational corporations (MNC) between headquarters (HQ) and their foreign subsidiaries have changed. Today, conflict is not necessarily regarded as dysfunctional or the result of inefficient global integration. Instead, conflict is now considered a normal consequence of organizing and managing across national borders. This research advances the literature on HQ-subsidiary relationships by adding new insights to the Headquarters-subsidiary conflict discussion, especially in the so far under-researched case of headquarter initiative rejection by foreign subsidiaries. We specifically focus on subsidiary conflict negotiation tactics, the effects of organizational and individual managerial power, and the characteristics and roles of MNC managers that act as boundary spanners during intra-organizational conflict processes. A qualitative, iterative, multiphase research approach was used to develop new theory pertaining to the phenomenon. The results show that in the presence of boundary spanners, dysfunctional conflict is less common and better overall organizational performance can be achieved for both the subsidiary and the MNC as a whole. The results also indicate that the boundary spanning ability is only partly formalizable and that some MNCs are able to foster boundary spanners better than others.
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