OPERATIONAL AND MOTIVATIONAL EFFICIENCY IN INTERNATIONAL STRATEGY AND STRUCTURE

Previous studies on international competitive strategies identify a number of loosely defined strategy types and suggest that the choice among them is based on their relative productive efficiency (i.e. ability to exploit such factors as economies of scale, economies of scope, and location economies). Our analysis highlights the additional role of motivational efficiency. We propose that the proportion of available productive efficiency that is actually realized under each strategy depends on the motivational efficiency of the best possible incentive system for implementing the strategy. Our conceptual framework allows the identification of precise theoretical relationships for empirical measurement and testing.