International Application of the OLI Framework Research Paper

International Application of the OLI Framework
Review of the Shell Technology India Investment using Ownership, Location, and Internalization (OLI) framework.
# 119717 | 2,365 words | 15 sources | APA | 2008 | SG
Published on May 21, 2010 in Business (Companies) , Business (International) , Business (Management) , Economics (Globalization)


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Description:

This paper explores the application of the Ownership, Location, and Internalization (OLI) framework to understand Royal Dutch Shell PLC's Technology India investment. The paper critically evaluates Shell's decision to set-up the multi-million dollar technology centre in India, and its analysis involves the use of theories of Foreign Direct Investment (FDI) to understand the investment decision in terms of choice of location and related ownership and internalization advantages to the company. The paper concludes that an extension of the OLI framework would enable early identification of challenges in future business operations.

Table of Contents:
Executive Summary 3
1. Introduction 4
2. Theories of Foreign Direct Investment (FDI) 5
3. OLI framework applied to Shell Technology India investment 6
3.1. Ownership advantage 6
3.2. Location advantage 8
3.3. Internalization advantages 11
3.4. Analysis and discussion 12
4. Conclusion 14
References 15
Appendix-1 OLI Framework in Details 17
Appendix-2 India's Competitive Balance Sheet 19

From the Paper:

"Theories of FDI may enable a systematic review and evaluation of foreign investment by a firm. FDI is not the only mode of entry into foreign markets. Alternatives such as exporting and licensing are normally considered less expensive and risky (Hill, 2007). Another important aspect of the investment decision is the choice of location. Also, the company may choose to invest only in certain activities of its value-chain e.g. the investment in Shell Technology India focuses on research and technology development alone. Hence a useful theory of FDI should be able to address:
a. The decision to invest in a foreign location vs. alternative entry modes
b. The choice of location
c. The value chain activities invested in the chosen foreign location"

Sample of Sources Used:

  • Businessline (2006) Shell plans technology centre in Bangalore: To scale up headcount. Businessline Chennai, 8th February 2006, p.1.
  • Businessline (2007) Shell's centre of excellence in Bangalore. Businessline Chennai, 22nd February 2007, p.1.
  • CNN Money (2007) Fortune Global 500 2007. [Internet]. Available online from: <http://money.cnn.com/magazines/fortune/global500/2007/full_list/index.html> [Accessed 2 December 2007]
  • Hill, C.W.L. (2007) International Business: Competing in the Global Marketplace. 6th Ed. New York, McGraw Hill.
  • Holsapple, E.J. Ozawa T. and Olienyk, J. (2006) Foreign "Direct" and "Portfolio" Investment in Real Estate: An Eclectic Paradigm. Journal of Real Estate Portfolio Management. 12(1) pp.37-47

Cite this Research Paper:

APA Format

International Application of the OLI Framework (2010, May 21) Retrieved August 19, 2019, from https://www.academon.com/research-paper/international-application-of-the-oli-framework-119717/

MLA Format

"International Application of the OLI Framework" 21 May 2010. Web. 19 August. 2019. <https://www.academon.com/research-paper/international-application-of-the-oli-framework-119717/>

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