The paper is aimed at the analysis of the concept of firm’s embeddedness and its influence on firm’s competitive advantage in the context of resource-based view of a firm, business networks theory, and international business theories. Embeddedness is characterized by the number of functional areas of the firm involved with external partners and the number of these partners, intensity and sustainability of linkages, and interdependence of relationships’ actors. The right level of embedding is crucial for augmenting and exploitation of the knowledge available to the firm. Therefore, embeddedness has been recognized as a significant determinant of firm’s sustainable competitive advantage in international markets. The paper discusses the specific issues related to relationship management, incl. those connected with the level and nature of embeddedness in transnational corporations (TNC). Analysis covers both the internal embeddedness, i.e. in linkages within the internal TNC network, and the external embeddedness, i.e. in relationships of headquarters or foreign subsidiaries with independent actors in a host country.

The paper is aimed at the analysis of the concept of firm’s embeddedness and its influence on firm’s competitive advantage in the context of resource-based view of a firm, business networks theory, and international business theories. Embeddedness is characterized by the number of functional areas of the firm involved with external partners and the number of these partners, intensity and sustainability of linkages, and interdependence of relationships’ actors. The right level of embedding is crucial for augmenting and exploitation of the knowledge available to the firm. Therefore, embeddedness has been recognized as a significant determinant of firm’s sustainable competitive advantage in international markets. The paper discusses the specific issues related to relationship management, incl. those connected with the level and nature of embeddedness in transnational corporations (TNC). Analysis covers both the internal embeddedness, i.e. in linkages within the internal TNC network, and the external embeddedness, i.e. in relationships of headquarters or foreign subsidiaries with independent actors in a host country.