Several studies examine the successful globalization and technological development of emerging-economy firms. However, few discuss why some other emerging-economy firms do not develop sufficient technological capabilities, and thus, fail in domestics and global markets. Consequently, the understanding of emerging-economy firm diversity is limited. By analyzing the failure of three firms in two major industries in Turkey, this study identifies a complex set of factors contributing to this outcome. These factors include political risk, macroeconomic regime, national technology policies, and industry dynamics, as well as firm-related factors such as ownership, strategic intent, and the approach to, and current stage of, technology capability development. The results indicate that some of these factors support firm success in the short term but discourage learning and technological capability building, and thus, cause firm failures in the long term. Thus, the study illustrates the importance of studying emerging-economy firms from an extended contextual and temporal perspective.

Introduction

The international success of emerging-economy firms (EEFs), such as Embraer (Vértesy, 2017), Huawei (Fan, 2006), Hyundai Motor Co. (Kim, 1998), and Arçelik (Karabag & Berggren, 2014a), as well as Indian pharmaceutical firms (Chittoor, Sarkar, Ray, & Aulakh, 2009), has been the subject of many studies in the fields of development economics, management, and innovation. Some studies argue that the firms in these countries have been successful because of their national economic and institutional contexts (Jenson, Leith, Doyle, West, & Miles, 2016). However, few discuss why some industries from the same emerging economies develop unique competitive advantages, while others do not (Hung & Whittington, 2000). Moreover, existing studies seldom explain why some EEFs succeed, while others within the same industry fail. For example, Korea has developed internationally competitive capabilities in the automotive industry. However, it is not clear why Hyundai succeeded both in the national market and globally (Amsden, 1992), while Samsung Motors and Daewoo Automotive failed (cf. Hundt, 2014).