The roles of Brazilian subsidiaries in the innovation strategies of foreign multinational companies

Abstract

Foreign owned multinational companies (MNC) subsidiaries located in Brazil carry out what kinds of product development projects? For which markets do they develop new products, adapt or improve existing products? This paper intends to find an answer to these questions using survey data from 146 product development units. Cluster analysis helps to identify five significantly distinct strategic groups: local adaptors, nascent innovators, local innovators, innovators for emerging markets and global innovators. The groups are profiled according to the type and the degree of interactions with local clients, suppliers and research institutes. The resulting typology may also be useful for designing Science and Technology (S&T) policies focusing on integrating MNC subsidiaries into the host country innovation system. Comparing these results with previous research carried out in industrialized countries, interesting differences as for the distribution of strategic roles and local interaction patterns were found.