Multinational Subsidiary Evolution: Capability and Charter Change in Foreign-Owned Subsidiary Companies

Birkinshaw, Julian; Hood, Neil

doi:10.2307/259062

Cited by 553 publications

(762 citation statements)

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“…They also show a positive correlation between age and capabilities in both R&D (r = .242, p = 0.065) and production (r = 0.280, p = 0.032) for subsidiaries down-under. 4 Finally, it is important to realise that the development of a subsidiary role is dependent on several factors: subsidiary choice, headquarters assignment and environmental determinism (Birkinshaw & Hood, 1998). Enhancement of subsidiary capabilities is a necessary, but not sufficient condition, for a subsidiary to acquire a more important role within the MNC network (Hood & Taggart, 1999).…”

Section: Resultsmentioning

confidence: 99%

Geographical distance and the role and management of subsidiaries: The case of subsidiaries down-under

Harzing

Noorderhaven

2006

Asia Pacific J Manage

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Based on a international mail survey covering 169 subsidiaries of MNCs headquartered in the USA, Japan, the UK, Germany, France and the Netherlands, we investigate the impact of geographical distance on the role that subsidiaries play in the MNC network and the way they are managed. To this end, we compare Australian and New Zealand subsidiaries -which provide a significant example of geographically isolation -compared to subsidiaries located in other countries. Referring to the typology constructed by Gupta & Govindarajan (1991), we show that Australian and New Zealand subsidiaries are more likely than subsidiaries in other countries to be Local Innovators rather than Global Innovators. In addition, both intra-company flows and the type of control mechanisms applied by HQ reflect the geographical isolation of Australian and New Zealand subsidiaries. The overall level of capabilities of Australian and New Zealand subsidiaries is equal to that of other subsidiaries, although lower relative capabilities in R&D and production seem to be associated with lower levels of local R&D and production. We discuss the implications of these findings and provide recommendations for management and competitiveness issues in Australia and New Zealand.

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Section: Resultsmentioning

confidence: 99%

Geographical distance and the role and management of subsidiaries: The case of subsidiaries down-under

Harzing

Noorderhaven

2006

Asia Pacific J Manage

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“…2011 www.anpad.org.br/bar consolidating this flow, as well as in directing it among subsidiaries, promoting their upgrade (Dhanaraj et al, 2004). Birkinshaw and Hood (1998) and Rugman and Verbeke (2001) point out that networks of globally distributed subsidiaries constitute a potential and important source of competitive advantage for multinational corporations. According to Frost (2001), by accessing the repository of knowledge embedded in the network of subsidiaries, multinationals can exploit or combine them to explore new niches and develop new abilities.…”

Section: Randd Internationalization and Knowledge Transfer In Multinatimentioning

confidence: 99%

Knowledge transfer in product development: an analysis of Brazilian subsidiaries of multinational corporations

Schreiber

Vilela²,

Vargas

et al. 2011

BAR, Braz. Adm. Rev.

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Several studies about knowledge transfer in multinational corporations have found that the process is influenced by factors such as absorptive capacity, tacit knowledge and power relations, all of which impact knowledge sharing strategies between corporate headquarters and foreign subsidiaries. A multiple case study of Brazilian subsidiaries of three multinational corporations using in-depth interviews, based on a conceptual model consisting of four propositions, was conducted to identify factors linked to the knowledge transfer process and to assess their influence on that transfer. The first proposition tries to assess explicit knowledge, primarily through the use of IT tools; the second analyzes the role of the subsidiary within the corporate network and how it influences the degree of knowledge sharing. The third assesses the influence of subsidiary absorptive capacity and the fourth analyzes the impact of worker exchange programs on knowledge sharing between headquarters and foreign subsidiaries. Study results confirm the four propositions and enable the identification of relationships between factors, especially explicit knowledge and worker expatriation as complementary factors in knowledge transfer strategies.

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“…However, most of these studies have been focused on the headquarters' strategic decisions of foreign R&D investment. After headquarters' initial evaluation of local environment and their decision of undertaking foreign investment, subsidiaries interact with local clusters and conduct R&D activities (Birkinshaw & Hood, 1998). Due to institutional, cultural and geographical reasons, subsidiaries' operations in host countries come across many context-specific complexities and difficulties (Harzing & Noorderhaven, 2006;Li & Scullion, 2006).…”

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confidence: 99%

Location advantages and subsidiaries’ R&D activities in emerging economies: Exploring the effect of employee mobility

Yang

Jiang

2007

Asia Pacific J Manage

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With multinational corporations increasingly seeking subsidiaries’ specific advantages in foreign countries to develop their innovative capabilities, internationalization of research and development has been greatly emphasized. However, in emerging economies, managers are encountering the challenge of high employee mobility under the weak intellectual property protection regime. This article investigates subsidiaries’ employee mobility and proposes that it negatively moderates the relationship between location advantages and the level of subsidiaries’ R&D. This article extends R&D internationalization and enhances current understanding of subsidiaries’ R&D activities. Further, it provides managerial implications as to how managers can improve R&D outcome by mitigating obstacles in emerging economies. Copyright Springer Science+Business Media, LLC 2007Employee mobility, Intellectual property protection, Location advantages, Subsidiaries’ R&D,

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Multinational Subsidiary Evolution: Capability and Charter Change in Foreign-Owned Subsidiary Companies

Cited by 553 publications

References 0 publications

Geographical distance and the role and management of subsidiaries: The case of subsidiaries down-under

Geographical distance and the role and management of subsidiaries: The case of subsidiaries down-under

Knowledge transfer in product development: an analysis of Brazilian subsidiaries of multinational corporations

Location advantages and subsidiaries’ R&D activities in emerging economies: Exploring the effect of employee mobility

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