Firmspecific capabilities and foreign direct investment activities of Turkish manufacturing firms

Purpose The purpose of this paper is to investigate the capabilities and characteristics of Turkish manufacturing firms that engage in outward FDI activity. To this end, the paper aims to explore how these firms' capabilities vary with the sample characteristics including subsidiary age, size, sector, host country location, ownership pattern and market entry mode. Designmethodologyapproach The data were gathered via crosssectional survey from a sample 94 Turkish manufacturing firms TMFs that have subsidiaries based in 28 different countries. Both univariate and multivariate tests were used to analyze the data. Findings Findings show that sample firms had strong firmspecific capabilities when they started to expand their business activities through foreign direct investment FDI. The firmspecific capabilities were grouped into four categories as operationrelated, productrelated, marketingrelated and managementrelated. While the capabilities of the sample firms varied to a moderate extent with their age and size, and to a limited extent with market entry mode, no significant differences were noted with respect to the industry, host country location and ownership pattern. Research limitationimplication Relying on the perceptual assessment of single respondents constitutes the main limitation of this study. There is also a need to collect data from other emerging or developed countries to enable comparisons between Turkey and other countries. Originalityvalue This is one of the few studies which attempt to examine the firmspecific capabilities of FDI firms from an emerging country.