The Digital Multinational Enterprise: Orchestration Theory as a Framework for Understanding Redefined Firm Boundaries and Strategy

Abstract

-The emergence of digital platforms, artificial intelligence, and ecosystem-based competition has fundamentally altered the competitive landscape within which multinational enterprises (MNEs) operate. This review examines how traditional internalization theory, while remaining influential, exhibits important limitations when applied to contemporary digital and AI-intensive environments. Building on recent theoretical developments, the review advances orchestration theory as a broader framework that conceptualizes the MNE as an entrepreneurial focal firm that coordinates distributed systems of assets, capabilities, and relationships across national and organizational boundaries. The review synthesizes recent scholarship demonstrating that competitive advantage increasingly derives from ecosystem coordination, the management of complementarities, and technologically mediated forms of control rather than ownership-based governance alone. It further examines how geopolitical fragmentation and regulatory divergence shape MNE orchestration strategies. The review concludes by identifying implications for international business scholarships and future research directions.