Regionalization strategy and performance The moderating role of industry dynamism and top management team diversity

Purpose - This paper contributes to the debate about the performance implications of adopting a regional as opposed to a global strategic posture. The aim of this paper is to argue that the performance effects of a regionalization strategy vary based on the characteristics of the industry in which the MNE operates and the composition of its top management team (TMT). Design/methodology/approach - This analysis is based on a cross-sectional dataset of 211 large European MNEs headquartered in four Western European economies at the end of 2005. Findings - Results show that firms adopting a regional orientation outperform MNEs with global strategic positioning. This positive relationship is less pronounced under conditions of industry dynamism and inter-regional TMT diversity. Originality/value - The study contributes to our understanding of whether and under what conditions MNEs benefit from adopting a regional as opposed to a global strategic posture.