The changing roles of a multinational enterprise's subsidiaries and headquarters in innovation transfer: A network perspective

Abstract

The aim of this paper is to identify the changing roles of actors involved in successful innovation transfer within a multinational enterprise. This should help in understanding how multinational enterprises are paving the way for performance management and management control in the innovation network. In examining successful innovation transfer, we identify how the internal (HQ, subsidiaries) and external actors contribute to innovation transfer and how this involvement changes over time. For the analysis, we use case studies of four different multinational enterprises and their chosen successful innovation transfer assessed from the perspective of their subsidiaries. In the analysis, we apply the idea of developing, producing and using settings of innovation derived from industrial network analysis. Our study makes a useful contribution to existing literature by shedding more light on the phenomenon of successful innovation transfer and providing a new, dynamic perspective on the roles of internal and external actors of multinational enterprises in this innovation transfer. We identify the changing roles of headquarters and subsidiaries in successful innovation transfer, indicate the importance of sister subsidiaries for this process and the lack of necessity to involve external customers in order to achieve a successful innovation transfer.

Innovation Performance of Foreign Subsidiaries in Post-Transition Economy: Evidence from Poland

“…Numerous studies indicate the positive influence of FS autonomy on its innovation performance. Increased autonomy of the subsidiary stimulates the creativity and motivation of its employees to create new knowledge and competencies [Ambos, Schlegelmilch, 2007] as it helps to be more responsive to external opportunities, and better learn from the host country innovation system [Keupp et al, 2011], create and manage links with sister subsidiaries [Dymitrowski, Ratajczak-Mrozek, 2019] and external partners, and further build a subsidiary's technological and business competencies needed in the innovation process [Beugelsdijk, Jindra, 2018;. As a higher level of autonomy is related to subsidiaries performing more advanced roles [Birkinshaw, Morrison, 1995].…”