| Revisiting the Headquarters-Subsidiary Relationship in the Multinational Corporation |
| | Johnston, Stewart | U. of Melbourne, Australia | s.johnston@ecomfac.unimelb.edu.au | +61 3 9344 4552 |
| | This paper attempts to make two contributions to the study of headquarters-subsidiary relationships in MNCs. First, the literature in the field is
reviewed with the purpose of establishing the theoretical basis of the work done so far. In particular, this includes combining insights from
recent studies within the resource-based theory of the firm and organisational learning paradigms with theory traditionally embraced in this
field from the market imperfections, strategy/structure and competitive advantage domains. In the process, some convergence between the
International Business and International Management perspectives is attained. Second, conclusions from this review are applied to the studies
aimed at characterising various features of MNC structure, to derive a theoretically grounded conceptual framework. This framework utilises the
organising principles of hierarchy and heterarchy to typologise the various subsidiary roles found within MNCs. A series of research propositions
are presented. |
| | Keywords: multinational corporation; headquarters-subsidiary |
| Control Exercised by U.S. Multinationals Over Their Overseas Affiliates: Does Location Make a Difference? |
| | Richards, Malika | Drexel U. | richardm@duvm.ocs.drexel.edu | (215) 895-2151 |
| | Using data collected through personal interviews with senior managers at U.S. multinational headquarters and their U.K, Thai, Malaysian, and Singaporean affiliates, this study examines whether U.S. multinationals adjust the amount of control they use over their culturally different overseas affiliates. Results showed no overall difference in the amount of control U.S. multinationals exercise over their U.K. and Southeast Asian affiliates. However, differences emerged between these two cultural groups when industry and affiliate top manager type were taken into account. In particular, U.K. locally-run affiliates were given significantly more autonomy than their Southeast Asian counterparts. Locally-run affiliates in both countries were also given significantly greater autonomy than were expatriate-run ones. Consumer goods affiliates in Southeast Asia enjoyed more autonomy than the industrial affiliates did. |
| | Keywords: Control; Multinational; Culture |
| Foreign Conrol and Survival of Joint Ventures: An Examination of Japanese IJVs in Asia |
| | Lu, Jane | U. of Western Ontario | Jlu@sms.ivey.uwo.ca | 519-679-2111 x 5006 |
| | Hebert, Louis | U. of Western Ontario | lhebert@ivey.uwo.ca | 519-661-4167 |
| | This study investigates the linkage between foreign equity control and IJV survival in an empirical setting of Japanese joint ventures in Asia over the 1985-1996 period. Using a hazard model, we examine the effects of asset specificity and uncertainty on the relationship between foreign parent control and IJV survival. The results show that in the presence of high Japanese parent R&D intensity, foreign equity control contributes to the IJV survival, but in the presence of high level of Japanese parent experience in the JV industry, high foreign control leads to more IJV exits. |
| | Keywords: IJVs; Control; Performance |
| Strategic idiosyncrasy versus depth of product renewal: Integrating an individual production unit into global multi-plant operations |
| | Collet, Markus Alexander | Cheneviere&Co. | markus.collet@cheneviere.com | +33-1-42975589 |
| | Global multi-plant operations expose each production unit to a tradeoff between integration and responsiveness. An MNC has to understand and use the fundamental mechanisms behind this tradeoff in order to respond to often contradictory strategic imperatives. Our concept of multi-site task accomplishment supplies such an understanding, capable of explaining both the tradeoff's restrictions and the leeway behind it. The present paper conceptualizes international operations by its two fundamental possibilities of accomplishing tasks: their repartition into largely independent sub-tasks and their common accomplishment across different units. We test our framework on a sample of plants located in France and belonging to global companies. The results show that a plant's strategic idiosyncrasy, the extent to which its strategy is different from those of the firm's other plants, severely limits a firm's capacity to handle local newness and complexity. Our study also introduces the depth of product renewal as a more adequate indicator for operational complexity than the often-used R&D intensity. Based on our results we propose ways how MNCs can limit the constraints of the integration-responsiveness tradeoff. |
| | Keywords: global organization; integration-responsiveness; task accomplishment |