Harvard Business Review on Thriving in Emerging Markets

How Local Companies Keep Multinationals at Bay

by Arindam K. Bhattacharya and David C. Michael

SINCE THE LATE 1970S, governments on every continent have allowed the winds of global competition to blow through their economies. As policy makers have lowered tariff barriers and permitted foreign investments, multinational companies have rushed into those countries. U.S., European, and Japanese giants, it initially appeared, would quickly overrun local rivals and grab the market for almost every product or service. After all, they possessed state-of-the-art technologies and products, enormous financial resources, powerful brands, and the world’s best management talent and systems. Poor nations such as Brazil, China, India, and Mexico, often under ...