This Ph.D. (dissertation) represents a personal scientific pathway, continued after many years of uncertainty, characteristic for life in B&H after dissolution of the former Yugoslavia. In this period, I was working on my first Ph.D. at the University of Banjaluka, B&H, which was nearly finished. However, because of the war, my wife Aida, 5 months old son Dino and I, were forced to become refugees, thus breaking my work on the Ph.D. In this way, bearing our B&H in our hearts, we relocated in a friendly country, Denmark, where we had our lovely daughter Enna. Since this time we have become Danish citizens and met many lovely people and feel, that Denmark is our second home. Newertheless, now, among many of these people mentioned later, I should single out one person, of course my advisor Jens Heide, thanks to whom I continued my scientific pathway and completed this Ph.D. This dissertation is aimed at companies and managers in both Denmark (western Europe) and the “former Yugoslavia” (Slovenia, Croatia and Bosnia & Herzegovina). It will give an understanding and perspective of the situations that can and will be encountered, should they wish to establish production in the former Yugoslavia (“appropriate engagement”). I will discuss why companies could find it an attractive proposition, from both points of view. This will include the benefits, barriers and problems that can be encountered, for all parties. This will be done with a thorough scientific analysis of relevant theories and investigations and be compared and discussed with the findings of a broad, empirical data analysis. The scientific data is primarily western European, with some limited Danish sources. The empirical data is assembled from a large range of sources in Denmark and Slovenia, Croatia and Bosnia & Herzegovina (S, C, B&H). The empirical data, in its raw form is a mixture of 7 different languages, two of which use the Cyrillic alphabet. This has led to some very interesting translation i.e. “red thread” (Sefik), “Rød tråd” (Danish), “Common thread” (English). Therefore it is important to read the text, especially the quotations, to find the context and not consider this an English essay. The findings of this dissertation it is hoped will be of help for anybody interested in this region and be a basis for further investigation. Many of the lessons learned could also be applied to many of the other countries in Eastern Europe, since the fall of the Berlin Wall. The empirical data is confidential, therefore the individual companies are not specifically named. The term “Globalisation” is used in the dissertation. This is a subject of some controversy at the present time, with some factions declaring it to be “Global Capitalism”. The author does not make judgement on these discussions but can see it as an inevitable factor in internationalisation. I wish to extend my thanks to all parties involved, here, in S, C, B&H and England. Special thanks should be extended to: my supervisor lector Jens Heide, one of mine friends Anthony M.ason, staff of Department of Manufacturing Engineering – IPT – DTU, staff of Department of Management – School of Economics and Management –University of Aarhus, staff of Business School - department of Business and management – University of Portsmouth, staff of Masinski Fakultet – Univerzitet, Bihac, my case companies and their managers who took part in this dissertation and all others who contributed in that I finished this dissertation. Sefik Muhic Lyngby, DTU, March 08th, 2002.