**4. The strategic (re-)orientation of the MNC**

As the macro- and micro-environmental conditions for MNCs operating in China have changed considerably, many foreign-invested firms see themselves under pressure to rethink and revise their most fundamental strategic bets as well as tactical deployments.

### **4.1 The revised strategic imperatives**

Research on MNCs has shown that major economic discontinuities in the past, such as the financial currency collapse in Asia (1998), the SARS outbreaks (2003), the subprime loan meltdown in 2008 and China's equity market crash in 2015, have tended to elicit defensive responses. Correspondingly, the exogenous shocks in recent years, including the start of the global Coronavirus pandemic (2020) and the invasions of Ukraine by Russia (2014 and 2022), have had corresponding effects. In many *MNC Strategy in Contested Environments: Stay Put or Stay Foot? DOI: http://dx.doi.org/10.5772/intechopen.112687*

instances, grand strategic ambitions by MNCs have been replaced by damage limitation. Along with these economic and geopolitical ruptures, distinctive reflexes in firms' strategic responses to exterior contingencies have revealed themselves. Prior to the frictions, the unequivocal game plan of foreign-invested companies in China was to 'push the envelope' in terms of business growth often ignoring the potential performance limits that firms cannot surpass unharmed. A large proportion of the MNCs in China pursued ambitious expansion plans [68–72]. While rising competition was requiring businesses to innovate and adapt to remain competitive, potential variations in strategic orientation, organisational resources and firm performance were less decisive as organisations were growing alongside the overall market expansion. This is to say that in periods of turbulence, variations in strategy configurations may become more conspicuous as both capabilities and shortcomings are highlighted. For example, in the context of the previously mentioned disruptions, firms often revert to reflexes that can be loosely described as prospective, defensive, analytical or reactive. Utilising these conceptions as a baseline, a widely confirmed typology can utilised to further explore the peculiarities of MNC strategy in China.
