The Impact of Changing Regulatory Environments on Bank Executives Strategy Formation

• To assure future survival in a constantly changing environment, the executives’ task is to adapt the firm’s strategies according to their expected changes in the environment. Mintzberg (1978) describes this process as the interplay between environmental changes and organizational adaptation mediated by executive decision-making. For the executives in an internationalizing firm, the process of strategy formation is becoming increasingly complex, as it includes changes in several environments formed by foreign markets (Ghauri and Holstius 1996). The Uppsala internationalization process (IP) model (Johanson and Vahlne 1977, 1990) explains the firm’s internationalization process as driven by the firm’s strive for gaining market knowledge through experiential learning and allocate the firm’s resources to build market commitment. In this vein the specificity in the general conditions of the environment is held at the country level and often only rudimentarily defined. The environment is commonly assumed to be uncontrollable by the single firm, meaning that decisions in the internationalization process are reactive to the environment and occurring changes therein (Håkansson and Snehota 1989; Johanson and Vahlne 1977). Problems and opportunities are thereby instigators for the executives’ decisions that follow an ‘evaluation of alternatives [which] is based on some knowledge about relevant parts of the market environment and about performance of various activities’ (Johanson and Vahlne 1977, p. 27). The purpose of this chapter is thereby to study when and how regulatoryenvironments in general or in specific foreign local markets affect executives’strategy formation in the internationalization process of firms. Afterthe introduction, a theoretical discussion building a conceptual model forexplaining executive strategy formation in a firm’s internationalization processis presented.

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Företagsekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Business Administration (hsv//eng)

Nyckelord

bank

internationalization

strategy

process

regulation

executive

environment

industriell ekonomi och organisation

Industrial Economics and Organisations

Publikations- och innehållstyp

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