Subsidiary autonomy and performance in Japanese multinationals in Europe

Kawai, Norifumi and Strange, Roger (2013) Subsidiary autonomy and performance in Japanese multinationals in Europe. International Business Review, 23 (3). pp. 504-515. ISSN 0969-5931

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Abstract

Notwithstanding the growing body of research on headquarters–subsidiary relationships, the conditions under which subsidiary autonomy leads to enhanced subsidiary performance is still a subject of debate. This study adopts a contingency approach and investigates the effects of external uncertainties and intra-MNE coordination on the performance benefits of subsidiary autonomy. The empirical analysis is based upon cross-sectional data collected from 88 European subsidiaries of Japanese MNEs. Our findings show that subsidiary autonomy has a greater impact upon performance (a) under conditions of technological uncertainty; and (b) when expatriate involvement is high, as the subsidiary can reap the full benefits of entrepreneurial capabilities and enjoy resource interdependencies through interactions with the parent simultaneously. MNC executives should aim for an appropriate balance between subsidiary autonomy and these internal and external factors so that the subsidiaries achieve superior performance.

Item Type: Article
Schools and Departments: School of Business, Management and Economics > Business and Management
Subjects: H Social Sciences > HD Industries. Land use. Labour > HD2350.8 Large industry. Factory system. Big business > HD2709 Corporations Including international business enterprises, diversification, industrial concentration, public utilities
Depositing User: Norifumi Kawai
Date Deposited: 18 Sep 2013 07:22
Last Modified: 13 Mar 2017 10:58
URI: http://sro.sussex.ac.uk/id/eprint/46316

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