Multinationals’ recruiting in industrial districts

ABSTRACT

This paper explains how multinationals source specific tacit and sticky technical knowledge in industrial districts through recruiting. Focusing on the location of the textile-dedicated company ZARA in a footwear-dedicated Marshallian industrial district, we study its recruiting strategy using mixed methods. ZARA recruits district footwear expertise by seeking primarily local workers with strong relational ties and intensive tacit knowledge originating from the best footwear-dedicated local firms that master knowledge on operations and expertise on managing local networks of subcontractors. Good local firms involuntarily benefit newcomer multinationals. The net effect on the district is the result of the tension between poaching and embeddedness and anchoring effects.

KEYWORD:

• multinational enterprises
• Marshallian industrial district
• tacit knowledge
• recruiting
• footwear

JEL:

• O33
• R1

ACKNOWLEDGEMENTS

We are thankful to the associated editor and the anonymous referees for their excellent feedback.

DISCLOSURE STATEMENT

No potential conflict of interest was reported by the authors.

Notes

1. Throughout, clusters and Marshallian industrial districts are used interchangeably, albeit we do recognize different social mechanisms prevailing in the latter.

2. We use ZARA and Inditex indistinctly throughout, the latter being the name of the corporation.

3. The Vinalopo industrial district (VID) in Spain is made up of four main municipalities: Elche, Elda, Petrer and Villena. Elche is, by far, the leading and largest hotspot. It is one of the largest footwear clusters in Europe, along with Riviera del Brenta in Veneto, Italy, sourcing shoes for premium brands such as Armani, Gucci, Prada, etc.

4. For more about the cluster, see Belso-Martinez (2006).

5. Named TEMPE within the ZARA-Inditex Group structure.

6. This is the Bureau van Dijk database for Spanish companies, for instance, the same version of the Italian AIDA (the latter for Italian companies) (see https://sabi.bvdinfo.com/version-2019222/Login.serv?product=sabineo&SetLanguage=en).

7. See Rugman et al.’s (2016) classification.

8. Adverse effects might also occur (Bellandi, 2001).

9. At least, while multinationals are interested in the local know-how.

Additional information

Funding

Jose-Luis Hervas-Oliver was financially supported by the Ministerio de Ciencia, Innovación y Universidades [grant number AEI/FEDER EU RTI2018-095739-B-100] and Generalitat Valenciana [grant number AICO/2020/123]. Jose Antonio Belso-Martínez was financially supported by the Conselleria de Economía Sostenible, Sectores Productivos, Comercio y Trabajo [grant number EBCORG/2019/1]. Isabel Díez-Vial was financially supported by the Spanish Ministry of Economy and Competitiveness [grant number AEI/FEDER, EU RTI2018-100823-B-I00].